Source: The Hindu 

Introduction 

The Chief Justice of India has consented to hear petitions challenging the government's controversial use of the Money Bill route for passing amendments in Parliament. This issue is significant as it involves potentially bypassing the Rajya Sabha's scrutiny.  

• The petitions argue that this approach may violate Article 110 of the Constitution of India,1950 , which defines the criteria for Money Bills. 

Which Cases Highlight Potential Violations of Article 110 Regarding Money Bills? 

• The Aadhaar Act, 2016 
  • Background:  
    • The Aadhaar Act, passed in 2016, established the legal framework for the Aadhaar identity system.  
    • It included provisions for enrollment, authentication, and the establishment of the Unique Identification Authority of India (UIDAI). 
  • Key Points: 
    • The government classified it as a Money Bill, citing Section 7, which links Aadhaar to subsidies and benefits drawn from the Consolidated Fund of India. 
    • This classification allowed the bill to bypass Rajya Sabha scrutiny. 
    • The Supreme Court reviewed this classification in a 2018 judgment. 
  • Court Decision: 
    • In a 4:1 majority, the Supreme Court upheld the Money Bill classification. 
    • The majority view considered the Act's primary purpose as the withdrawal of funds from the Consolidated Fund, with other provisions being incidental. 
    • The current Chief Justice of India (then a judge) was the lone dissenter, arguing that the Aadhaar Act did not meet the strict definition of a Money Bill under Article 110. 
  • Implications:  
    • This case set a precedent for a broader interpretation of Money Bills, raising concerns about potential misuse of this route to bypass the upper house. 
• The Finance Act, 2017 
  • Background:  
    • The Finance Act of 2017 included provisions for reorganizing various tribunals, including the National Green Tribunal, and was passed as a Money Bill. 
  • Key Points: 
    • The Act amended several laws related to tribunal structures and appointments. 
    • These amendments were seemingly unrelated to taxation or government spending. 
    • The use of the Money Bill route for these reforms was highly controversial. 
  • Court Decision:  
    • In Rojer Mathew v. South Indian Bank (2019), a five-judge bench: 
      • Struck down the tribunal-related provisions of the Finance Act, 2017. 
      • Expressed concern over the broad interpretation of Money Bills in the Aadhaar judgment. 
      • Highlighted that the Aadhaar case didn't adequately discuss the significance of the word "only" in Article 110's definition of Money Bills. 
      • Referred the matter to a larger bench for a more comprehensive review. 
  • Implications:  
    • This case highlighted the need for a stricter interpretation of Money Bills and raised questions about the potential misuse of this classification for non-financial matters. 
• Amendments in PMLA 
  • PMLA amendments (2015-2019) were passed as Money Bills, granting extensive powers to the Enforcement Directorate. 
  • The Supreme Court upheld these amendments but deferred the Money Bill question to a larger bench. 
  • Concerns persist about potential misuse of powers and circumvention of legislative scrutiny through the Money Bill route. 

What are the Main Issues Regarding Money Bill? 

• Circumvention of Bicameral Scrutiny: The utilization of Money Bills enables the executive to bypass the constitutional mandate for legislative review by the Upper House, potentially undermining the principle of checks and balances. 
• Erosion of Bicameral Legislature: This practice may compromise the intended equilibrium of India's bicameral parliamentary structure as envisioned by the Constitution. 
• Curtailment of Rajya Sabha's Legislative Function: In the case of Money Bills, the Rajya Sabha's role is relegated to a merely advisory capacity, lacking substantive power to amend or reject the proposed legislation. 
• Diminished Legislative Oversight: The bypassing of Rajya Sabha potentially results in a deficit of comprehensive deliberation and thorough examination of proposed statutes. 
• Alleged Contravention of Article 110: There exist concerns regarding the adherence of certain bills, classified as Money Bills, to the strict constitutional criteria outlined in Article 110. 
• Unreviewed Certification Authority: The Lok Sabha Speaker's prerogative to certify a bill as a Money Bill, being immune from judicial review, raises apprehensions about potential misuse of this constitutional power. 
• Potential Infringement of Constitutional Safeguards: This practice may be perceived as undermining the spirit of constitutional provisions designed to ensure equitable and balanced legislative processes. 
• Controversy over Non-Fiscal Provisions: The inclusion of non-financial clauses in Money Bills has been subject to criticism as a potential misapplication of this specialized legislative mechanism. 
• Judicial Reviewing: The judiciary faces the complex task of reconciling respect for parliamentary procedures with the imperative of ensuring constitutional compliance. 
• Democratic Representation Concerns: This practice potentially limits the representation of diverse perspectives in the legislative process, particularly those from states represented in the Rajya Sabha, raising questions about the inclusivity of law-making. 

What are Constitutional Provisions Regarding Money Bill? 

Definition of Money Bill 

• Article 110 of the Constitution of India, 1950 (COI) defines Money Bill. It reveals that - 
  • • (1) For the purposes of this Chapter, a Bill shall be deemed to be a Money Bill if it contains provisions relating to all or any of the following matters, namely  
    • (a) the imposition, abolition, exemption, variation or regulation of any tax; 
    • (b) regulation of borrowing of money or giving any guarantee by the Government of India, or amendment of law in relation to any financial obligations made or to be made by the Government of India; 
    • (c) the custody of the Consolidated Fund of India or the Contingency Fund, payment of money into any such fund or withdrawal of money; 
    • (d) Appropriation of moneys from the Consolidated Fund of India; 
    • (e) declare any expenditure to be a charged expenditure on the Consolidated Fund of India or increase the amount of any such expenditure; 
    • (f) receipt of money from the Consolidated Fund of India or the Public Account of India or the custody or issuance of such money or audit of the accounts of the Union or a State; or 
    • (g) any matter relating to any of the matters referred to in sub-clauses (a) to (f) 
  • (2) A Bill shall not be deemed to be a Money Bill only because it provides for the imposition of penalty or other pecuniary penalty, or the demand for or payment of a fee for a licence or the imposition of, or abolition, exemption, diversion or any tax regulation by a local authority or body for local purposes. 
  • (3) If any question arises as to whether a Bill is a Money Bill or not, the decision of the Speaker of the Lok Sabha thereon shall be final. 
  • (4) When a Money Bill is referred to the Rajya Sabha under Article 109, and when it is given to the President for assent, the Speaker of the Lok Sabha has to sign a certificate stating that it is a Money Bill. 

Money Bill Process 

• Article 109 of the Constitution of India provides special procedure with respect to Money Bills. It reveals that - 
  • (1) A Money Bill shall not be introduced in the Council of States (Rajya Sabha). 
  • (2) After a Money Bill has been passed by the Lok Sabha, it shall be sent to the Rajya Sabha for recommendation, and the Rajya Sabha shall, within a period of fourteen days from the date of its receipt, send the Bill back to the Lok Sabha with its recommendations and the Lok Sabha may thereafter accept or reject all or any of the recommendations of the Rajya Sabha. 
  • (3) If the Lok Sabha accepts the recommendation made by the Rajya Sabha, the Money Bill shall be deemed to have been passed by both Houses with amendments recommended by the Rajya Sabha. 
  • (4) If the Lok Sabha rejects any suggestion of the Rajya Sabha, the Money Bill is deemed to have been enacted by both Houses without any amendment recommended by the Rajya Sabha in the same form as it was passed by the Lok Sabha. 
  • (5) If a Money Bill passed by Lok Sabha and transmitted to the Rajya Sabha for its recommendations is not returned to the Lok Sabha within the said period of fourteen days, at the expiration of the said period shall be deemed to have been passed by both Houses in the same form as was passed by Lok Sabha. 
  • The President can accept or reject a money bill but cannot return it for reconsideration. 
    • There is no provision for joint sitting in case of Money Bill. 

Conclusion  

The controversy surrounding the classification of bills as Money Bills in India significant constitutional issues regarding legislative procedure and the role of the Rajya Sabha. Recent judicial scrutiny, particularly in cases such as the Aadhaar Act and the Finance Act of 2017, has highlighted concerns over the broad interpretation of Money Bills and their potential misuse to bypass meaningful scrutiny. The unresolved questions and varying judicial interpretations necessitate a balanced approach to uphold the integrity of India's bicameral parliamentary system while ensuring adherence to constitutional safeguards. The pending seven-judge Supreme Court bench ruling is eagerly anticipated to provide clarity on the interpretation of Article 110 and the extent of the Money Bill provision.