Article 206: Votes on Account, Votes of Credit, and Exceptional Grants

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(1) Notwithstanding anything in the foregoing provisions of this Chapter, the Legislative Assembly of a State shall have power—

    (a) to make any grant in advance in respect of the estimated expenditure for a part of any financial year pending the completion of the procedure prescribed in article 203 for the voting of such grant and the passing of the law in accordance with the provisions of article 204 in relation to that expenditure;

    (b) to make a grant for meeting an unexpected demand upon the resources of the State when on account of the magnitude or the indefinite character of the service the demand cannot be stated with the details ordinarily given in an annual financial statement;

    (c) to make an exceptional grant which forms no part of the current service of any financial year; and the Legislature of the State shall have power to authorise by law the withdrawal of moneys from the Consolidated Fund of the State for the purposes for which the said grants are made.

(2) The provisions of articles 203 and 204 shall have effect in relation to the making of any grant under clause (1) and to any law to be made under that clause as they have effect in relation to the making of a grant with regard to any expenditure mentioned in the annual financial statement and the law to be made for the authorisation of appropriation of moneys out of the Consolidated Fund of the State to meet such expenditure.

Explanations

Article 206 provides the Legislative Assembly of a State with the authority to issue specific financial grants in advance, during emergencies, or for exceptional circumstances, ensuring flexible financial management for unplanned demands.

Clause-by-Clause Explanation

Clause (1): Powers to Authorize Financial Grants

Sub-clause (a): Advance Grants (Votes on Account)

This provision allows for grants to cover part of a financial year’s expenses pending formal budget approval. Such advance grants help keep essential services uninterrupted.

Sub-clause (b): Unforeseen Expenditures (Votes of Credit)

The Legislative Assembly can approve funds for significant or indefinite expenses. This ensures that emergencies, like natural disasters, can be managed financially.

Sub-clause (c): Exceptional Grants

These grants allow funding for expenditures outside the scope of typical services, supporting unique or unexpected projects.

Clause (2): Compliance with Articles 203 and 204

This clause mandates adherence to the standard grant procedures, applying Articles 203 and 204 to ensure legislative oversight over these exceptional financial allocations.

Real-Life Examples

  • During the COVID-19 pandemic, states like Kerala required votes of credit to manage unprecedented healthcare demands and public safety measures.
  • In Assam, exceptional grants were provided to support flood relief efforts, helping communities rebuild after severe floods caused extensive damage.

Historical Significance

Article 206 reflects the Constitution’s approach to enabling responsive governance. By allowing states to address unforeseen expenses, it upholds financial flexibility in line with the British model of budget management, where Parliament allocates urgent funds without delay.

Legislative History

Article 206, initially presented as Article 181 in the Draft Constitution, was debated and adopted on June 10, 1949. Dr. B.R. Ambedkar proposed an amendment to include provisions for financial flexibility, empowering the states to address urgent and unforeseen expenditures without disrupting routine budgeting processes.

Debates and Deliberations

During the Constituent Assembly debates, Dr. B.R. Ambedkar emphasized the need for states to handle sudden expenses independently. Members like Shri H.V. Kamath advocated for this approach, seeing it as essential for responsive governance.

References

  • The Constitution of India, Article 206, detailing votes on account, votes of credit, and exceptional grants.
  • Constituent Assembly Debates, 1949, focused discussions on state financial autonomy and flexibility.
  • Journal of Public Administration and Governance, analyzing the role of Article 206 in state fiscal management.

Frequently Asked Questions

  • What is the purpose of Article 206? It allows states to allocate funds quickly for unexpected or urgent needs, like natural disasters or unique projects.
  • What are Votes of Credit? These are grants for undefined or large expenses, typically needed in emergencies or crises.
  • Who authorizes Votes on Account? The Legislative Assembly, with recommendations from the state Governor, approves such votes to ensure uninterrupted services.
Article 205 Article 207