• • Article 112: president shall lay before each house of parliament , an annual financial statement; estimates shall show separately the expenditure charged on and expenditure made from Consolidated fund ; it shall distinguish expenditure on revenue account from other expenditure .

    • • Article 113: No demand for a grant shall be made except on recommendation of president ; expenditure charged on the Consolidated fund shall not be submitted to the vote of parliament.

    • • Article 114: No money shall be withdrawn from consolidated fund of India except under appropriation made by law.

    • • Article 117:- No money Bill imposing tax shall be introduced in the parliament except on the recommendation of the president and Money Bill cannot be introduced in Rajya Sabha

    • • Article 265: No tax can be levied except by authority of law .

    • • Rajya Sabha has no power to vote on demand for grants.

    • • Rajya Sabha should send Money Bill within 14 days to lok Sabha .

    • • Parliament can reduce or abolish a tax but cannot increase it .

    • •Term ‘budget’ has nowhere been used in the Constitution


    Presentation of Budget

    Presented by Finance Minister (with prior recommendation of president) in parts- part A- a general economic survey of country; Part B – taxation proposals. Presented in 2 phases – Railway Budget (By Railway Minister in 3rd week of February) & General Budget by finance Minister on last working day of February at 5 pm There is no discussion of ?Budget is laid before Rajya Sabha .

    General Discussion

    Starts after few days of its presentations spread over 3-4 days in both Houses. By Convention, at this stage , members details of taxation & expenditure . No cut motions or voting at this stage . FM has general right of reply at the end .

    Budget in Department Related Standing Committees

    These committees (17 in 1993 increased to 24 in 2004 ) work during recess of parliament (April 1- 18 ) and discuss individual demands of each ministry, and submit reports to parliament within given time – limit; but cannot make suggestions amounting to cut motions .

    Voting on demands for grants

    Demands for grants are presented ministry wise; discussed in detail & put in from of a motion. Members can disapprove a policy, suggest measures for economy , and focus attention to specific grievances by moving subsidiary motions called Cut Motions’ while the General Budget has totally 109 demands (103 for civil expenditure and 6 for defence expenditure), the Railway Budget has 32 demands. Each demand is voted separately by the Lok Sabha. Business Advisory Committee fixes a time for voting a particular demand. As the time limit for a demand is over, ‘ Closure is applied & demand is put to vote. On last day, demands not disposed of so far, are put to vote whether discussed or not . this process is known as Guillotine. With this the discussion on demands for grants is concluded.

    Passing of Appropriation Bill

    Gives legal authority to government to appropriate expenditure from & out of Consolidated Fund . includes grants voted by Lok Sabha & expenditure charged on Consolidated Fund. It is passed in the same manner as any other Bill except that the debate is restricted to those matters only which were not covered during the debate on demands & that no amendment can be made to it. Once passed by Lok Sabha , it transmits to Rajya Sabha which has no power to amend or reject it but has to give its concurrence . the bill is then sent to president for assent.

    Passing of Finance Bill

    It includes al taxation proposals of Government . All taxes are not to be voted every year Some of them are permanent & their rates can be varied from time to time by Government . is not . Amendments can be moved to it . this bill has to be particular estimates is not. Amendments can be moved to it . this bill has to be passed by Parliament & assented to by president within 75days after it is introduced


    • •India follow a twin- budgetary system where in Railway budget is presented separately from the general budget. The railways budget was separated from the general in 1921 on the recommendations of the Acworth committee. Finance Ministry, the Administrative Ministries and their offices, Planning Commission and CAG are all involved in the preparation of Budget on India .

    • The estimates of budget consists of 2 types of expenditure the expenditure charged upon the Consolidated fund of India and the expenditure ‘made’ from the consolidated of the India charged expenditure is not – votable by the parliament , that is it, can only be discussed by the parliament . while the other type has to be voted by the Parliament. The list of the CHARAGED EXPENDITURE is as follows:
      1. Emoluments & allowances of the president and expenditure relating to his office.

      2. Salaries & allowances of Chairman ?& Deputy Chairman of Rajya Sabha and Speaker & Deputy Speaker of Lok Sabha .

      3. Salaries, allowances & pensions of the judges of Supreme Court, CAG, Chairman & members of UPSC, and of persons serving in these offices.

      4. The pensions of the judges of high court .

      5. Debt charges for which the GOI is liable including interest, sinking fund chargers and redemption chargers and other expenditure relating to raising of loans and the service and redemption of debt.

      6. Any sum required to satisfy and judgment decree or award

      7. Any other expenditure declared by the parliament to be so charged.

    There are 3 kinds of funds provided under the Constitution for the custody of the funds:

    Consolidated fund of India (Article 266)

    Consolidated fund of India (Article 266) fund to which all receipts are credited and all payments are debited (i) all revenues received by GoI; (ii) all loans raised by the issue of treasury bills loans or ways & means of advances, and (iii) all moneys received in repayment of loans – form receipt side. No money out of it can be appropriated except in accordance with a parliamentary law.

    Public Account of India (Article 266):

    All other public money (other then Consolidated fund) received by GOI shall be credited to it : Provident fund deposits, judicial deposits , savings bank deposits, department deposits remittances etc. Operated by executive action, that is the payments from this account can be made without the parliamentary appropriation. Such payments are mostly in the nature of banking transactions.

    Contingency fund of India (Article 267):

    The constitution authorized parliament to establish a Contingency fund of India into which shall be paid from time to such sums as may be determined by law accordingly parliament enacted contingency fund of India Act in 1950. This fund is placed at the disposal of the president , and he can make advances out of it to meet unforeseen expenditure pending its authorization by the parliament.


    Disapproval of policy cut It states that amount of demand be reduced to Re1.
    Economy Cut Demand be reduced by a specified amount/ lump – sum.
    Token Cut Demand be reduced by mere Rs100. It aims to ventilate specific grievance .