Money Bill Route for Contentious Amendments

Syllabus: GS2/ Polity and Governance

The Supreme Court of India agreed to list petitions challenging the Money Bill route taken by the Centre to pass contentious amendments in the Parliament.

The Money Bill case was referred to the supreme court in2019 in the case of Rojer Mathew vs. South Indian Bank Ltd.
The issue is whether such amendments could be passed as a Money Bill, circumventing the Rajya Sabha, in violation ofArticle 110 of the Constitution.

The issue of passing contentious amendments as Money Bills in India has sparked significant legal and constitutional debates.

Constitutional Violation: Article 110 of the Indian Constitution defines what constitutes a Money Bill. It restricts Money Bills to provisions dealing solely with certain financial matters. Bills passed under this category bypass the Rajya Sabha, which has limited powers over them.
Scope of Money Bills: Several amendments, such as those to the Prevention of Money Laundering Act (PMLA) and the Finance Act, 2017, have been controversially passed as Money Bills. Critics argue that these amendments included provisions unrelated to financial matters specified in Article 110, thereby circumventing the scrutiny of the Rajya Sabha.
Executive Overreach: By using the Money Bill route for amendments that could arguably be considered beyond the scope of financial matters, there are concerns about potential executive overreach and undermining the checks and balances intended by the Constitution.

Article 110 Definition: A bill is classified as a Money Bill if it exclusively deals with matters like taxation, government borrowing, or certain types of expenditure (like from the Consolidated Fund). It cannot include provisions unrelated to these matters.
Role of the Speaker: The decision of whether a bill is a Money Bill rests with the Speaker of the Lok Sabha. Once the Speaker certifies a bill as a Money Bill, the Rajya Sabha’s role is limited to making recommendations within 14 days.
Judicial Review: The Supreme Court of India has been approached to review the constitutional validity of passing amendments as Money Bills when they potentially include non-financial provisions. This review is crucial in determining whether the legislative process adhered to constitutional principles.

Rojer Mathew vs. South Indian Bank Ltd.: This case initiated the Supreme Court’s scrutiny of the Money Bill route in 2019. It highlighted concerns regarding the proper classification of bills under Article 110.
Finance Act, 2017: Amendments altering the structure of judicial tribunals were passed under the Money Bill classification. This raised questions about the appropriate use of the Money Bill provision.
Aadhaar Act, 2016: Provisions in this Act were also passed as a Money Bill, despite containing elements that some argued were not strictly financial in nature, such as issues related to privacy and data protection.

The controversy over using the Money Bill route for contentious amendments underscores the need for a clear interpretation and application of Article 110 of the Constitution. It balances the efficiency of legislative processes with the constitutional requirement for parliamentary oversight and scrutiny.
The Supreme Court’s forthcoming decisions on these cases will likely provide important clarifications on the permissible scope of Money Bills and the extent of Rajya Sabha’s role in legislative processes involving financial matters.