IAS Gyan

Daily News Analysis


21st February, 2024 Polity


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  • In recent years, the Supreme Court of India has been confronted with the complex task of defining what constitutes a "money Bill." This question has arisen in light of several significant cases, including challenges to the electoral bond scheme and the Aadhaar Act.
  • Currently, a seven-judge constitution bench is deliberating on this issue. This article explores the significance of this legal question and why it has become a focal point of judicial scrutiny.

What is a Money Bill?

  • Money Bills are a special category of legislation that allows for expedited enactment of laws by Parliament.
  • Unlike regular bills, which require approval from both the Lok Sabha and the Rajya Sabha, a money Bill only needs the assent of the Lok Sabha.
  • The Rajya Sabha can only suggest amendments, which the Lok Sabha may accept or reject.
  • Article 110 of the Constitution lays down the criteria for classifying a Bill as a money Bill. It must exclusively deal with matters such as taxation, government finances, or the consolidated fund of India.

Can Any Bill Be Called a Money Bill?

  • Not every bill can be designated as a money Bill. Article 110 sets out specific criteria that a Bill must meet to qualify as a money Bill. The final decision on whether a Bill qualifies as a money Bill rests with the Speaker of the Lok Sabha.
  • The Finance Ministry explains that all revenues and loans received by the government are credited to the Consolidated Fund of India, from which government expenditures are made.
  • Similarly, the Contingency Fund allows the government to meet unforeseen expenses. The recent enactment of 'Finance Acts' through the money Bill route has brought this issue to the forefront.

Challenges to Money Bills in the Supreme Court

  • The Supreme Court has faced challenges to the classification of Bills as money Bills in the past.
  • In the Aadhaar case of 2018, the court upheld the Act as constitutional, ruling that it was validly passed as a Money Bill since it dealt with subsidies and benefits, involving expenditure from the Consolidated Fund of India.
  • However, Justice Chandrachud dissented, arguing that passing the Aadhaar Act as a money Bill was an abuse of the constitutional process.
  • In another case, the court struck down the Appellate Tribunal Rules of 2017, introduced through a money Bill, for giving the central government undue control over tribunal members' service conditions.
  • The court referred the question of whether the Finance Act, 2017, was validly passed as a money Bill to a larger bench.

Current Status and Future Implications

  • Challenges to amendments passed through the money Bill route have been put on hold pending the seven-judge bench's decision on the Finance Act, 2017.
  • Depending on the outcome, there may be renewed challenges to laws such as the PMLA and the Aadhaar Act.
  • The Supreme Court's decision on what constitutes a money Bill will have far-reaching implications for the legislative process and the balance of power between the two Houses of Parliament.



Q. Which of the following statements regarding a Money Bill in India is/are correct?

1.A Money Bill can be introduced in either house of Parliament.

2.The Speaker of the Lok Sabha decides whether a Bill is a Money Bill or not.

3.A Money Bill must be passed by both the Lok Sabha and the Rajya Sabha.

4.The Rajya Sabha has limited powers to amend a Money Bill.

Select the correct answer using the codes below:

A) 1 and 2 only

B) 2 and 4 only

C) 1, 2, and 4 only

D) 2, 3, and 4 only

Answer: B) 2 and 4 only


In India, a Money Bill is a type of legislation that exclusively deals with financial matters, such as taxation, government finances, or the consolidated fund. Here's the explanation for each statement:

1.Incorrect: A Money Bill can only be introduced in the Lok Sabha (House of the People) and not in the Rajya Sabha (Council of States).

2.Correct: The decision on whether a Bill is a Money Bill or not is made by the Speaker of the Lok Sabha.

3.Incorrect: A Money Bill only needs to be passed by the Lok Sabha. The Rajya Sabha can suggest amendments, but the Lok Sabha has the final say on whether to accept or reject these amendments.

4.Correct: The Rajya Sabha has limited powers about a Money Bill. It cannot reject or amend a Money Bill, and it must return the Bill to the Lok Sabha within 14 days for consideration of its recommendations.

Therefore, the correct answer is B) 2 and 4 only.