Part V: The Union

Procedure in Financial Matters

Article 114: Appropriation Bills

--- Original Article ---

(1) As soon as may be after the grants under article 113 have been made by the House of the People, there shall be introduced a Bill to provide for the appropriation out of the Consolidated Fund of India of all moneys required to meet—

• (a) the grants so made by the House of the People; and
• (b) the expenditure charged on the Consolidated Fund of India but not exceeding in any case the amount shown in the statement previously laid before Parliament.

(2) No amendment shall be proposed to any such Bill in either House of Parliament which will have the effect of varying the amount or altering the destination of any grant so made or of varying the amount of any expenditure charged on the Consolidated Fund of India, and the decision of the person presiding as to whether an amendment is inadmissible under this clause shall be final.

(3) Subject to the provisions of articles 115 and 116, no money shall be withdrawn from the Consolidated Fund of India except under appropriation made by law passed in accordance with the provisions of this article.

Explanations

Article 114 is a vital component of the financial procedures in the Indian Constitution. It governs the introduction and passage of the Appropriation Bill, which permits the government to withdraw money from the Consolidated Fund of India. The article ensures that the funds required for public spending, whether for approved grants or expenses charged to the Consolidated Fund, are legally sanctioned by Parliament.

Clause-by-Clause Explanation

Clause (1): Bill for Appropriation of Funds

After the House of the People has made grants under Article 113, the government must introduce a Bill to appropriate funds from the Consolidated Fund of India. These funds are used for meeting the grants approved by the House and covering the expenditure already charged to the Consolidated Fund, as long as it does not exceed the amount previously presented in Parliament.

Clause (2): Prohibition on Amendments

This clause restricts both Houses of Parliament from proposing amendments to the Appropriation Bill that alter the destination or amount of any grant. The presiding officer's decision regarding whether an amendment is admissible is final, thereby safeguarding the integrity of the government's financial planning.

Clause (3): Lawful Withdrawal of Funds

No funds can be withdrawn from the Consolidated Fund of India without a law being passed that specifically appropriates those funds. This clause ensures that government spending is both transparent and accountable to Parliament.

Real-Life Examples

• When the Union Budget for 2022 was approved, the Appropriation Bill authorized the release of funds for several key sectors, including infrastructure and healthcare, following approval by the Lok Sabha.
• In the 2018 parliamentary session, attempts were made to propose amendments to the Appropriation Bill concerning defense spending, but the Speaker ruled them inadmissible as per Clause (2).

Historical Significance

The system of parliamentary control over public funds, a legacy of British colonial rule, was integrated into the Indian Constitution to prevent the executive branch from bypassing legislative scrutiny. During the 2020 COVID-19 pandemic, the government sought additional funds through a supplementary grant, which was passed in Parliament under Articles 115 and 116. These funds could only be utilized after the Appropriation Bill was enacted.

Legislative History

Article 114 of the Indian Constitution, initially drafted and deliberated as article 94 of the Draft Constitution, was ultimately incorporated into the Indian Constitution on June 10, 1949.

Debates and Amendments

Dr. B. R. Ambedkar introduced a new article aimed at replacing outdated provisions related to the certification of schedules by the Governor-General. However, Shri K. Santhanam voiced opposition to clause (3), which permitted the withdrawal of funds without prior parliamentary approval. In contrast, Shri R. K. Sidhwa supported the article, emphasizing the need for thorough scrutiny of Money Bills. After thorough debate, the article was adopted into the Constitution.

References

• The Constitution of India - Article 114, Appropriation Bills.
• Constituent Assembly Debates - Discussions on Article 94 (Draft Article 94).
• Basu, D.D. "Commentary on the Constitution of India".
• Jain, M.P., "Indian Constitutional Law," 8th Edition - Financial procedures and Appropriation Bills.
• Parliamentary Rules of Procedure and Conduct of Business in Lok Sabha.