The Rajya Sabha should not be deprived of its legitimate right to legislative disapproval through strategems such as certifying any bill as a money bill

The Chairman of the Rajya Sabha, Vice-President Hamid Ansari and the Deputy Chairman, Prof. >P.J. Kurien, reportedly expressed their concern recently on attempts being made to whittle away the legislative powers of the Rajya Sabha and make it a redundant legislative House. Sitaram Yechury, leader of the Communist Party of India (Marxist) in the Rajya Sabha, and other Opposition leaders have protested against what they called a move to erode the role and power of the House in making laws.

This controversy arose from a statement by Union Finance Minister Arun Jaitley about money bills. Mr. Jaitley is reported to have said that money bills, over which the Rajya Sabha has limited powers, are the answer to the obstructionist ways of the Opposition in that House. This statement by the Finance Minister came to be interpreted as an attempt to classify most of the >crucial bills which go to the Rajya Sabha as money bills to prevent them from being rejected by that House.

P. D. T. Achary P. D. T. Achary

Defining a money bill

At the centre of this controversy is the money bill — a technical term in the Constitution and the House rules referring to a certain class of bills which contain taxation proposals and proposals relating to money matters etc. Under Article 110, a money bill only contains matters such as imposition, abolition, remission, alteration or regulation of any tax. It also includes regulations related to borrowing of money or giving guarantee by the Government of India; the custody of the Consolidated Fund of India (CFI) or the Contingency Fund of India, and payment of moneys into or withdrawal of moneys from such funds; and the appropriation of moneys out of the Consolidated Fund of India.

Besides the above, it includes charged expenditures like the salary of the President, Vice-President, Speaker, judges etc.; the receipt of money on account of the Consolidated Fund or the public account, its custody etc.; and matters incidental to any of these. Article 109 says a money bill can be introduced only in the Lok Sabha. After it is passed by the Lok Sabha, the Bill is transmitted to the Rajya Sabha for its recommendations only. The Rajya Sabha cannot disapprove the money bill but can recommend amendments, which the Lok Sabha can reject in toto. Even then, the bill will be deemed to have been passed by both Houses.

Thus, the Lok Sabha alone has the power to accept or reject money bills. The power to certify a bill as a money bill is vested by Article 110 of the Constitution in the Speaker of the Lok Sabha, whose decision is final. Some Rajya Sabha Members have raised concerns about the finality of the Article. Their uneasiness arises from the fact that the Rajya Sabha can’t question the decision of the Speaker even when they feel that they have a strong case for contesting the decision of the Speaker.

Parliamentary convention

It must be mentioned that in all the countries where the parliamentary system of government exists, the directly elected House alone has the final say in financial matters. This primacy of the people’s House is enshrined in the Indian Constitution. The superiority of the Lok Sabha in budgetary sanctions is secured in two ways. One, the demands for grants — the estimate of expenditure of individual ministries and departments of the government — are presented before and passed only by the Lok Sabha. Two, the Appropriation Bills, authorising the government to withdraw money from the Consolidated Fund of India, being money bills, cannot be disapproved by the Rajya Sabha. This constitutional position is well known.

But here the problem is not the primacy of the Lok Sabha in money matters. The apprehension among the Members is that the government may bring bills with financial provisions and push them through as money bills in order to circumvent the situation in the Rajya Sabha. The Constitution makes it abundantly clear that money bills should contain only the above mentioned matters and nothing else. If a bill is a combination of any of the above and some other provisions not incidental to those matters, it cannot be called a money bill. Such a bill needs to be passed by both the Houses of Parliament.

At first blush, the apprehension of the Members of the Opposition seems out of place because the Speaker of the Lok Sabha is required to apply her mind to the true character of the bill objectively. The Constitution clearly defines the money bill and the Speaker cannot circumvent it. The word “only” used in article 110 (1) strictly limits the scope of a money bill and rules out any liberal or politically convenient interpretation of this term.

Nevertheless, the possibility of non-money bills being certified as money bills and the power of the Rajya Sabha being curtailed cannot be ruled out. It is rather incongruous that the Chairman of the Rajya Sabha — the Vice- President — is placed in the position of having to accept the decision of the Speaker on the money bills issue unquestioningly. The Constitution has vested this power in the Speaker in conformity with the traditions in all parliamentary democracies. Neither the Constitution nor the House rules lay down any procedure with regard to certifying a money bill. This situation is rather unsatisfactory.

The Rajya Sabha is the Council of States and has played a crucial role in strengthening the Indian federation. The Constitution has assigned special roles to this elders’ chamber of the Indian Parliament. For example:

When the Parliament wants to make a law on an item in the State list, it can do so only if the Rajya Sabha passes a resolution by a two-thirds majority. The creation of an All India Service follows a two-thirds majority resolution in the Rajya Sabha.

Moreover, the Vice-President of India, the number two in the order of precedence, is the Chairman of this House.

Precedents show that the finality of the Speaker’s decision has been accepted by the Rajya Sabha. As early as 1953, Prime Minister Jawaharlal Nehru, while commenting on the authority of the Speaker to certify a money bill, said, “It is now clear and beyond possibility of dispute that the Speaker’s authority is final in declaring that a bill is a money bill. When the Speaker gives a certificate to this effect, this cannot be challenged. The Speaker has no obligation to consult anyone in coming to a decision or in giving his certificate.”

Constitutional conundrum





A caveat is in order here. The Speaker, while certifying a bill as money bill, is in effect depriving the Rajya Sabha of its legislative power to disapprove a bill. If it is said that the Speaker has absolute power and she does not have to consult anyoneit is tantamount to accepting even a wrong decision by her, maybe even a mala fide decision. The Constitution of India does not confer such absolute power on any authority.

The question is whether there is no remedy if a wrong decision actuated by political considerations is taken by a Speaker — not an impossibility. It may be a bona fide mistake but it renders the Rajya Sabha helpless. An example can be cited from this year’s Finance Bill, which contains a chapter amending the Money Laundering Act. By no stretch of imagination can it be said to conform to the stipulations laid down in Article 110 regarding a money bill or related to the imposition or regulation of any tax; or regulation of the borrowing of money by the government; or giving guarantee by the government; or undertaking any financial obligations by the government; or relating to the custody of the Consolidated Fund of India or the Contingency Fund; or relating to the appropriation of moneys from the CFI; or receipt of money on account of CFI. Therefore, it cannot be a part of the Finance Bill.

The case of the Senior Citizens Welfare Fund is similar. This fund, which consists of unclaimed money from various statutory funds, does not come within the scope of “Regulation of borrowing of money or the giving of any guarantee by the government” under Article 110(1)(b). Chapter seven of the Finance Bill contains provisions relating to this fund. As a matter of fact, if such non-money bill provisions are incorporated in the Finance Bill, it will cease to be a money bill.

“It must also be stated here that the Finance Bill can contain only proposals for one year. It cannot contain any proposal of a permanent nature as Article 112 limits the time frame of a budget to one year. ”

The Finance Bill gives effect to taxation proposals which are a part of the statement of estimated receipts “for that year”. If proposals of a permanent nature are made a part of the Finance Bill and certified as money bills, the move come into conflict with Articles 110 and 112 of the Constitution.

It is therefore necessary to evolve a proper procedure for the Speaker to arrive at a decision. A committee of the secretaries-general of both Houses may examine in detail the given bill and submit their views to the Speaker before she takes a final decision.

There may or may not be any truth in the Opposition Members’ contention that all the non-money bill provisions were put in the Finance Bill to avoid the Rajya Sabha obstructing the passage of these bills. The only matter of importance here is that the Rajya Sabha should not be deprived of its legitimate rights through legislative strategems.

It may be remembered that Article 122 provides immunity against challenges to the proceedings only on the grounds of procedural irregularities. A wrong decision taken under Article 110(3) is not a procedural irregularity and hence does not grant any immunity.

( P.D.T. Achary was the Secretary General of the 14th and 15th Lok Sabhas and the Lok Sabha Secretariat)