India’s Supreme Court, comprised of a seven-judge Bench spearheaded by the Chief Justice of India, recently prioritised a reference that pertains to the method in which the Centre has been able to pass key amendments in Parliament as Money Bills. This spotlight on the legislative approach has led to wider discussions about the constitutionality and legality of such measures.
Challenged Amendments
Certain amendments passed as Money Bills have faced legal challenges and stirred debate. These include amendments to the Prevention of Money Laundering Act (PMLA), the Finance Act of 2017, and the Aadhaar Act of 2016.
The PMLA amendments from 2015 onwards provided broad powers to the Enforcement Directorate, including arrest and raid authority. Legal voices questioned the passage of these amendments as Money Bills.
The Finance Act of 2017 was also termed and passed as a Money Bill. Critics allege that the Act was intended to change appointments to important judicial tribunals such as the National Green Tribunal and Central Administrative Tribunal. Critics also suggest that this was a tactical move to expand executive control over these tribunals.
The Aadhaar Act 2016 faced similar criticism, though it was cleared by the Supreme Court as a valid money bill under Article 110 of the Constitution. The government’s argument was based on the fact that subsidies distributed through Aadhaar flow from the Consolidated Fund of India, therefore justifying the identification as a Money Bill.
Implications of a Larger Bench’s Review
A more comprehensive review by a larger bench of the Supreme Court could provide clarity on the constitutionality of the challenged acts like the PMLA, Aadhaar Act, and Tribunal reforms. It could help determine if these laws were correctly identified as money bills or used to bypass Rajya Sabha scrutiny. The bench may also offer insights into the extent of scrutiny that judiciary can exercise over the Speaker’s decisions in classifying bills as money bills.
Understanding the Money Bill
A Money Bill, as defined in Article 110(1) of the Indian Constitution, is a financial legislation that deals exclusively with matters specified in Article 110 (1) such as taxation, government borrowing, and the appropriation of money from the Consolidated Fund of India. The Speaker of the House of the People has the final say on whether a Bill is a Money Bill, as per Article 110 (3).
Procedure-wise, Money Bills must be introduced in the Lok Sabha and cannot be introduced in the Rajya Sabha. The latter can only make recommendations on a Money Bill but does not have the power to amend or reject it. The President can either accept or reject a money bill but cannot send it back for reconsideration. There is no provision for Joint sitting.
Testing Knowledge: Past Questions on Money Bill from UPSC Civil Services Examination
Certain questions related to Money Bills have appeared in past years’ examinations of the Union Public Service Commission’s Civil Services. For example, in 2018, candidates were asked to identify an incorrect statement about Money Bills. Another question in 2013 involved understanding the consequence if a Money Bill is substantially amended by the Rajya Sabha. These instances highlight the significance of understanding the concept and mechanisms around Money Bills.
