A Bill is said to be a Money Bill if it only contains provisions related to taxation, borrowing of money by the government, expenditure from or receipt to the Consolidated Fund of India. Bills that only contain provisions that are incidental to these matters would also be regarded as Money Bills. Article 110 of the Indian Constitution provides for the Money Bill.
The Speaker certifies a Bill as a Money Bill, and the Speaker’s decision is final. A Money Bill may only be introduced in Lok Sabha, on the recommendation of the President. It must be passed in Lok Sabha by a simple majority of all members present and voting. Following this, it may be sent to the Rajya Sabha for its recommendations, which Lok Sabha may reject if it chooses to. If such recommendations are not given within 14 days, it will deemed to be passed by Parliament.
Money Bill Vs Financial Bill
Financial Bills, all Financial Bills are not Money Bills. For example, the Finance Bill which only contains provisions related to tax proposals would be a Money Bill. However, a Bill that contains some provisions related to taxation or expenditure, but also covers other matters would be considered as a Financial Bill.
However Money Bill has courted lot of controversy in the recent times, especially regarding the unquestioned powers of the Speaker and its possible misuse. There seem to be some trickeries involved in the issue covered under Article 110.
- Article 110(1), grants to the Lok Sabha Speaker the authority to certify a draft law as a money bill so long as such legislation deals only with all or any of the matters specifically listed in the provision.
- These include subjects such as the imposition or abolition of a tax, the declaring of any expenditure to be expenditure charged on the Consolidated Fund of India, and, significantly, also any matter otherwise incidental to the subjects specified in Article 110.
- The ensuing clause clarifies that a draft law will not be a money bill for the reason that it also provides for the imposition or abolition of a tax. In other words, substantive laws, which are not merely incidental to the subjects enlisted in Article 110(1) cannot be finagled into a bill that also happens to contain taxing rules.
- It is precisely such trickery that the petitioners contended the Finance Act of 2017 indulges in.
- The Union government, for its part, argued that the Speaker of the Lok Sabha was not only correct in making the classification, but that, in any event, her decision was beyond judicial review. To this end, the government relied on Article 110(3), which states that in cases where a dispute arises over whether a bill is a money bill or not, the Speaker’s decision shall be considered final.
- But, as the Supreme Court has repeatedly held, the finality accorded to the Speaker’s decision does not altogether oust the court’s jurisdiction. The irrevocability of such decisions operate only within the realm of Parliament.
- For the Constitution expressly vests in the Supreme Court and in the high courts the power to review governmental actions, and issue prerogative writs every time those actions exceed the Constitution’s remit.
Ultimately, the Speaker derives her power from the Constitution. In classifying a draft law as a money bill, therefore, her decision has to be demonstrably justifiable. An immunity from judicial scrutiny would effectively allow the government to elude the Rajya Sabha’s constitutional checks by simply having the Speaker classify a draft law as a money bill regardless of whether it, in fact, meets the conditions stipulated in Article 110(1) or not.
From a parliamentary custom
- The idea behind a money bill is derived from British parliamentary custom. But unlike in Britain, where judicial review of the Speaker’s opinion is unambiguously prohibited, in India, Article 110 avoids creating any such bar. Money bills exist simply to ensure that the Rajya Sabha isn’t allowed to bring down a government by refusing it access to the exchequer for everyday governance.
- To use it as a means to nullify the Upper House’s democratic role in making substantive legislation denigrates the Constitution’s form which Ambedkar and the Constituent Assembly considered inviolate.
- The Supreme Court has already squandered at least two opportunities in recent times to provide a sense of sanctity to the Constitution’s carefully structured arrangements. The dispute over the Finance Act of 2017, therefore, assumes particular significance. In deciding the case, the court will do well to pay heed to Ambedkar’s warnings, by recognising that the niceties of constitutional form are not a matter of trifles.
Conclusion Hence it is the need of the hour to avoid the misuse of Constitutional provisions as seen in the case of Speaker’s role in the declaration of a Money Bill. The sanctity and impartiality of the office of Speaker needs to be maintained in order to realize a vision of Constitutional forefathers i.e., India as a true democracy.