PASSING OF MONEY BILL AND ORDINARY BILL
Answer
The procedure for passing a Money Bill in India is governed by specific provisions in the Constitution,
primarily outlined in Article 110 and Article 109. A Money Bill is defined as a bill that exclusively deals
with financial matters such as taxation, borrowing of money, and the appropriation of funds. Here’s a
detailed overview of the procedure involved in passing a Money Bill:
Definition of a Money Bill
According to Article 110 of the Indian Constitution, a bill is considered a Money Bill if it contains
provisions related to:
1. Imposition, abolition, remission, alteration, or regulation of any tax.
2. Regulation of the borrowing of money by the Union government.
3. Custody of the Consolidated Fund of India or the Contingency Fund of India.
4. Appropriation of money out of the Consolidated Fund of India.
5. Declaration of any expenditure charged on the Consolidated Fund of India or increasing the
amount of any such expenditure.
6. Receipt of money on account of the Consolidated Fund or public account of India.
7. Any matter incidental to any of the matters specified above.
A bill that includes provisions outside these categories cannot be classified as a Money Bill.
Procedure for Passing a Money Bill
Step 1: Introduction in Lok Sabha
A Money Bill can only be introduced in the Lok Sabha (House of the People) and not in the
Rajya Sabha (Council of States).
The introduction must be made on the recommendation of the President, which is
mandatory for all Money Bills.
Step 2: Passage in Lok Sabha
Once introduced, the Money Bill goes through several readings in the Lok Sabha:
First Reading: The bill is introduced without debate.
Second Reading: Members discuss its provisions and may suggest amendments.
Committee Stage: The bill is examined in detail by a committee, which can
recommend further amendments.
Third Reading: The final version is debated and voted upon.
If a majority of members present vote in favor, the Money Bill is passed by the Lok Sabha.
Step 3: Transmission to Rajya Sabha
After passing in the Lok Sabha, the Money Bill is transmitted to the Rajya Sabha for its
recommendations.
The Rajya Sabha has 14 days from receiving the bill to return it with its recommendations.
Step 4: Recommendations by Rajya Sabha
The Rajya Sabha cannot amend a Money Bill but can suggest recommendations.
Upon receiving recommendations:
If the Lok Sabha accepts any recommendations from the Rajya Sabha, those
amendments are incorporated into the bill, which is then deemed passed by both
Houses.
If the Lok Sabha rejects all recommendations, or if no recommendations are made
within 14 days, the bill is deemed passed in its original form as passed by the Lok
Sabha.
Step 5: Assent by President
After being passed by both Houses (or deemed passed), the Money Bill is sent to the
President for assent.
The President can either:
Give assent, after which it becomes law and is published in the Statute Book.
Withhold assent (though this action is rare for Money Bills).
Important Points to Note
1. Speaker’s Certification: The Speaker of the Lok Sabha certifies whether a bill is a Money Bill.
This certification is final and binding on both Houses.
2. Rajya Sabha's Role: While Rajya Sabha can suggest changes, it cannot reject or amend a
Money Bill outright. Its powers are limited compared to those concerning ordinary bills.
3. Time Frame: If a Money Bill is not returned by Rajya Sabha within 14 days, it automatically
passes in its original form as approved by Lok Sabha.
Conclusion
The procedure for passing a Money Bill reflects India's commitment to maintaining financial
discipline while ensuring that legislative processes are efficient and transparent. By requiring that
Money Bills originate in the Lok Sabha and limiting Rajya Sabha's powers regarding such bills, India
emphasizes its parliamentary democracy's financial accountability and governance principles.
Understanding this process is essential for grasping how fiscal policies and government expenditures
are legislated within India's federal structure.
The procedure for passing an ordinary bill in the Indian Parliament is a structured process that
involves several stages in both Houses of Parliament: the Lok Sabha (House of the People) and the
Rajya Sabha (Council of States). This process ensures thorough discussion, debate, and scrutiny of
proposed legislation before it becomes law. Below is a detailed explanation of the stages involved in
passing an ordinary bill.
1. Introduction of the Bill
First Reading
An ordinary bill can be introduced in either the Lok Sabha or the Rajya Sabha.
The member introducing the bill must seek leave of the House to present it. If leave is
granted, the member reads out the title and objectives of the bill.
No discussion or debate occurs at this stage, and the bill is published in the Gazette of
India for public knowledge.
2. Second Reading
The second reading is a critical phase where detailed discussions on the bill take place. This stage
consists of three sub-stages:
a. Stage of General Discussion
The principles and broad provisions of the bill are discussed.
Members can express their views on the bill's objectives without going into detailed clauses.
The House can take one of several actions:
Consider the bill immediately or on a specified date.
Refer it to a Select Committee for further examination.
Refer it to a Joint Committee comprising members from both Houses.
Circulate the bill to elicit public opinion.
b. Committee Stage
If referred to a Select Committee, this committee examines the bill clause by clause.
The committee can suggest amendments but cannot alter the fundamental principles
underlying the bill.
After thorough examination, the committee reports back to the House with its
recommendations.
c. Consideration Stage
The House considers the bill as reported by the committee.
Each clause is discussed and voted upon separately, allowing members to propose
amendments.
Amendments accepted during this stage become part of the bill.
3. Third Reading
Final Debate and Voting
During this stage, no further amendments are allowed; members debate whether to accept
or reject the entire bill as it stands.
A simple majority of members present and voting is required for passage.
If approved, the bill is deemed passed by that House.
4. Bill in the Other House
Once an ordinary bill has passed one House, it is sent to the other House (if it started in Lok Sabha, it
goes to Rajya Sabha, and vice versa) for consideration. The second House follows similar procedures:
Stages in the Second House
1. First Reading: The bill is introduced without discussion.
2. Second Reading: It undergoes general discussion, committee scrutiny, and consideration
stage similar to what was done in the first House.
3. Third Reading: Final debates occur before voting.
Actions by Second House
The second House may:
Pass the bill as received from the first House (without amendments).
Pass it with amendments and return it to the first House for reconsideration.
Reject it altogether.
Keep it pending for up to six months without taking any action.
5. Deadlock Resolution
If there is a disagreement between both Houses (e.g., one House passes a bill while the other rejects
or amends it), a deadlock may occur. In such cases:
The President can summon a joint sitting of both Houses to resolve disputes over bills.
A joint sitting allows members from both Houses to vote on the bill together, requiring only a
simple majority for passage.
6. Assent of the President
After both Houses have passed an ordinary bill (either in identical form or with accepted
amendments), it is sent to the President for assent. The President has three options:
1. Assent: If given, the bill becomes law and is published in the Statute Book.
2. Withhold Assent: The bill does not become law if assent is withheld.
3. Return for Reconsideration: The President can return an ordinary bill (except Money Bills)
with recommendations for reconsideration by both Houses.
If returned, both Houses must reconsider and may pass it again with or without amendments.
Conclusion
The procedure for passing an ordinary bill in India reflects a comprehensive legislative process
designed to ensure thorough scrutiny and democratic participation in law-making. By involving
multiple stages and allowing for extensive debate, this process helps maintain checks and balances
within India's parliamentary system. Understanding this procedure is essential for grasping how laws
are formulated and enacted within India's democratic framework.
1. K. Puttaswamy v. Union of India (2018)
Background: This case primarily dealt with the constitutionality of the Aadhaar Act, which was
passed as a Money Bill. Petitioners argued that the Act included provisions unrelated to taxation or
financial matters, thus violating Article 110 of the Constitution.
Judgment: The Supreme Court upheld the validity of the Aadhaar Act by a 4-1 majority, stating that
its primary objective was to provide subsidies and benefits, which justified its classification as a
Money Bill. Justice Ashok Bhushan, who concurred with the majority, emphasized that since the Act
involved expenditure from the Consolidated Fund, it fell within the ambit of a Money Bill.
2. Rojer Mathew v. South Indian Bank Ltd. (2019)
Background: This case involved challenges to amendments made to various laws through Money
Bills, specifically concerning provisions related to judicial tribunals in the Finance Act of 2017.
Judgment: A five-judge bench referred questions regarding what constitutes a Money Bill to a larger
seven-judge bench, highlighting concerns about whether legislative amendments could be passed as
Money Bills to circumvent Rajya Sabha scrutiny.
