APPENDIX XVII

 APPENDIX 17
(See Paragraph 6 of Preface to the Second Edition)

Constitutional Provisions having 
a bearing on the budget,
Finance and Accounts

ബഡ്ജറ്റുമായി ബന്ധപ്പെട്ട ഇന്ത്യന്‍ ഭരണഘടനയിലെ ആര്‍ട്ടിക്കിളുകളാണ് ഈ അനുബന്ധത്തില്‍ നില്‍കിയിരിക്കുന്നത്. ഓരോ ആര്ട്ടിക്കിലുകളുടേയും ഹെഡിംഗ് ഒന്നു വായിച്ചു നോക്കുക. കാര്യമായ ചോദ്യങ്ങള്‍ ചോദിച്ചു കാണുന്നില്ല. എങ്കിലും ബഡ്ജറ്റ്‌ മാന്വലില്‍ പ്രതിപാദിച്ചതിന്‍റെ റഫന്‍സിനുവേണ്ടി ഈ അനുബന്ധം പ്രയോജനപ്പെടുത്താം.

148. Comptroller and Auditor General of India.—

(1) There shall be a Comptroller and Auditor-General of India who shall be appointed by the President by warrant under his hand and seal and shall only be removed from officer in like manner and on the like grounds as a judge of the Supreme Court.

(2) Every persons appointed to be the Comptroller and Auditor-General of India shall, before he enters upon his officer, make and subscribe before the President, or some person appointed in that behalf by him, an oath or affirmation according to the form set out for the purpose in the Third Schedule.

(3) The salary and other conditions of service of the Comptroller and Auditor-General shall be such as may be determined by Parliament by law and, until they are so determined shall be as specified in the Second Schedule:

Provided that neither the salary of a Comptroller and Auditor-General nor his rights in respect of leave of absence, pension or age of retirement shall be varies to his disadvantage after his appointment.

(4) The Comptroller and Auditor-General shall not be eligible for further officer either under the Government of India or under the Government of any State after he has ceased to hold his office.

5. Subject to the provisions of this Constitution and of any law made by Parliament, the conditions of service of persons serving in the Indian Audit and Accounts Department and the

administrative powers of the Comptroller and Auditor-General shall be such as may be prescribed by rules made by the President after consultation with the Comptroller and Auditor-General.

6. The administrative expenses of the office of the Comptroller and Auditor-General, including all salaries, allowances and pensions payable to or in respect of persons serving in that office, shall be charged upon the Consolidated Fund of India.

149. Duties and Powers of the comptroller and Auditor-General.—The Comptroller and Auditor-General shall perform such duties and exercise such powers in relation to the accounts of the Union and of the States and of any other authority or body as may be prescribed by or under any law made by Parliament and, until provision in that behalf is so made, shall perform such duties and exercise such power in relation to the accounts to the Union and of the States as were conferred on or exercisable by the Auditor-General of India immediately before the commencement of this Constitution in relation to the accounts of the Dominion of India and of the Provinces respectively.

150. Power of Comptroller and Auditor-General to give directions as to accounts.—The accounts of the Union and of the States shall be kept in such form as the Comptroller and Auditor-General of India may, with the approval of the Provinces respectively.

151. Audit Reports.—

(1) The reports of the Comptroller and Auditor-General of India relating to the accounts of the Union shall be submitted to the President, who shall cause them to be laid before each House of Parliament.

(2) The reports of the Comptroller and Auditor-General of India relating to the accounts of a State shall be submitted to the Governor of the State, who shall cause them to be laid before the Legislature of the State.

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199. Definitions of “Money Bills”.—(1) For the purposes of this Chapter, a Bill shall be deemed to be a Money Bill if it contains only provisions dealing with all or any of the following matters

namely:—

(a) The imposition, abolition, remission, alteration or regulation of any tax;

(b) the regulation of the borrowing of money or the giving of any guarantee by the State, or the amendment of the law with respect to any financial obligations undertaken or to be undertaken by the State;

(c) the custody of the Consolidated Fund or the Contingency Fund of the State, the payment of moneys into or the withdrawal of moneys from any such Fund;

(d) the appropriation of moneys out of the Consolidated Fund of the State;

(e) the declaring of any expenditure to be expenditure charged on the Consolidated Fund of the State, or the increasing of the amount of any such expenditure;

(f) the receipt of money on account of the Consolidated Fund of the State ir the public account of the State or the custody or issued of such money; or

(g) any matter incidental to any of the matters specifies on sub-clauses (a) to (f).

 

(2) A Bill shall not be deemed to be a Money Bill by reason only that it provides for the imposition of fines or other pecuniary penalties, or for the demand or payment of fees for licenses or fees for services rendered, or by reason that it provides for the imposition, abolition, remission, alteration or regulation of any tax by any local authority or body for local purposes.

(3) If any question arises whether a Bill introduced in the Legislature of a State which has a Legislative Council is a Money Bill or not, the decision of the Speaker of the Legislative Assembly of such State thereon shall be final.

(4) There shall be endorsed on every Monday Bill when it is transmitted to the Legislative Council under Article 198, and when it is presented to the Governor for assent under Article 200, the certificate of the Speaker of the Legislative Assembly signed by him that it is a Money Bill.

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202. Annual Financial Statement.—

(1) The Governor shall in respect of every financial year cause to be laid before the House of Houses of the Legislature of the State a statement of the estimated receipts and expenditure of the State for that year in this part referred to as the “annual financial statement”.

(2) The estimates of expenditure embodied in the annual financial statement shall show separately:—

(a) the sums required to meet expenditure described by this Constitution as expenditure charged upon the Consolidated Fund of the State; and

(b) the sums required to meet other expenditure proposed to be made from the Consolidated

Fund of the State; and shall distinguish expenditure on revenue accounts from other expenditure.

(3) The following expenditure shall be expenditure charged on the Consolidated Fund of each

State:—

(a) the emoluments and allowances of the Governor and other expenditure relating to his office;

(b) the salaries and allowances of the Speaker and the Deputy Speaker of the Legislative

Assembly and, in the case of a State having a Legislative Council, also of the Chairman and the Deputy Chairman of the Legislative Council;

(c) debt charges for which the state is liable including interest sinking fund charges and redemption charges , and other expenditure relating to the raising of loans and the service and redemption of debt;

(d) expenditure in respect of the salaries and allowances of Judges of any High Court;

(e) any sums required to satisfy any judgment, decree of award of any court or arbitral tribunal;

(f) any other expenditure declared by this Constitution, or by the Legislature of the State by law,

to be so charged.

203. Procedure in Legislature with respect to estimates.—

(1) So much of the estimates as relates to expenditure charged upon the Consolidated Fund of a State shall not be submitted to the vote of the Legislative Assembly, but nothing in this clause shall be construed as preventing the discussion in the Legislature of any of those estimates.

(2) So much of the said estimates as relates to other expenditure shall be submitted in the form of demands for grants to the Legislative Assembly, and the Legislative Assembly shall have power to assent, or to refuse to assent, to any demand, or to assent to any demand subject to a reduction of the amount specified therein.

(3) No demand for a grant shall be made except on the recommendation of the Governor.

204. Appropriation Bills.—(1) As soon as may be after the grants under Article 203 have been

made by the Assembly, there shall be introduced a Bill to provide for the appropriation out of the

Consolidated Fund of the State of all moneys required to meet—

(a) the grants so made by the Assembly; and

(b) the expenditure charged on the Consolidated Fund of the State but not exceeding in any case

the amount shown in the statement previously laid before the House or Houses.

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

(3) Subject to provision of Articles 205 and 206, no money shall be withdrawn from the Consolidated Fund of the State except under appropriations made by law passed in accordance with provisions of this article.

205. Supplementary, additional or excess grants.—(1) The Governor shall—

(a) if the amount authorised by any law made in accordance with provisions of Article 204 to be

expended for particular service for the current financial year is found to be insufficient for the purposes

of that year or when a need has arisen during the current financial year for supplementary of additional expenditure upon some new service not contemplated in the annual financial statements for that year,

or

(b) if any money has been sent on any service during a financial year o excess of the amount granted for the service and for that year, cause to be laid before the House or the Houses of the Legislature of the State another statement showing the estimated amount of that expenditure or cause to

be presented to the Legislative assembly of the State a demand for such excess as the case may be.

(2) The provisions of Articles 202, 203 and 204 shall have effect to relation to any such statement and expenditure or demand and also to any law to be made authorising the appropriation of moneys out of the Consolidated Fund of the State to meet such expenditure or grant in respect of such demand as they have effect in relation to the annual financial statement and the expenditure mentioned therein or to a demand for a grant 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 or grant.

206. Votes on account, Votes of Credit and exceptional grants.—(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 details ordinarily given in an annual financial statement;

(c) To make an exceptional grant which forms no part or the current service of any financial year; and the Legislature of the state shall have poser 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 article 203 and 204 shall have effect in relation in the making of any grant under clause (1) and to any law to be made under the clause as they have effected 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.

207. Special provisions as to financial Bills.—(1) A Bill or amendment making provision for any of the matters specified in sub-clauses (a) to (f) of clause (1) of Article 199 shall not be introduced or moved except on the recommendation of the Governor, and a Bill making such provision shall not be introduced in a Legislative Council;

Provided that no recommendation shall be required under this clause for the moving of an amendment making provision for the reduction or abolition of any tax.

(2) A Bill or amendment shall not be deemed to make provision for any of the matters aforesaid by reason only that it provides for the imposition of fines or other pecuniary penalties, or for the demand or payment of fees for licences or fees for services rendered, or by reason that it provides for

the imposition, abolition, remission, alteration or regulation of any tax by any local authority or body for local purposes.

(3) A Bill which if, enacted and brought into operation, would involve expenditure from the consolidated Fund of a State shall not be passed by a House of the Legislature of the State unless the Governor has recommended to that House the consideration of the Bill.

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209. Regulation by law of procedure in the Legislature of the State in relation to financial business.—The Legislature of a State may, for the purpose of the timely completion of financial business, regulate by law the procedure of, and the conduct of business in, the House or Houses of the Legislature of the State in relation to any financial matter or to any Bill for the appropriation of moneys out of the Consolidated Fund of the State, and, if and so far as any provision of any law so made is inconsistent with any rule by the House or either House of the Legislature of the State

under clause (1) of Article 208 or with any rule or standing order having effect in relation to the Legislature of the State under clause (2) of that article, such provision shall prevail.

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258. Power of the Union to confer powers, etc., on States in certain cases.—(1) Notwithstanding anything in this Constitution, the President may, with the consent of the Government of a State, entrust either conditionally or unconditionally to that Government or to its officers, functions in relation to any matter to which the executive power of the Union extends.

(2) A law made by Parliament which applies in any State may, notwithstanding that it relates to a matter with respect to which Legislature of the State has no power to make laws, confer powers and impose duties, or authorise the conferring of powers and the imposition of duties, upon the State or

officers and authorities thereof. 

(3) Where by virtue of this article powers and duties have been conferred or imposed upon a State or officers or authorities thereof, there shall be paid by the Government of India to the State such sum as may be agreed, or, in default of agreement, as may be determined by an arbitrator appointed by the Chief Justice of India, in respect of any extra costs of Administration incurred by the State in connection with the exercise of those powers and duties.

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265. Taxes not to be imposed save by authority of law.—No tax shall be levied or collected except by authority of law.

266. Consolidated Funds and Public Accounts of India and of the States.—(1) Subject to the provisions of Article 267 and to the provisions of this Chapter with respect to the assignment of the whole or part of the net proceeds of certain taxes and duties to States, all revenues received by the Government of India, all loans raised by that Government by the issued of treasury bills.

loans or ways and means advances and all moneys received by that Government in repayment of loans shall form one consolidated fund to be entitles “the Consolidated Fund of India” and all revenues received by the Government of a State, all loans raised by that Government by the issue of treasury bills, loans or ways and means advances and all moneys received by that Government in repayment of loans shall form one consolidated fund to be entitled “the Consolidated Fund of the State”.

(2) All other public moneys received by or on behalf of the Government of India of the Government of a State shall be credited to the public account of India or the public account of the State, as the case may be.

(3) No moneys out of the Consolidated Fund of India or the Consolidated Fund of the State shall be appropriated except in accordance with law and for the purposes and in the manner provided in this Constitution.

267. Contingency Fund—(1) Parliament may by law establish a Contingency Fund in the nature of an imprest to be entitled “the Contingency Fund of India” into which shall be paid from time to time such sums as may be determined by such law, and the said Fund shall be placed at the disposal of the President to enable advances to be made by him out of such Fund for the purposes of meeting unforeseen expenditure pending authorisation of such expenditure by Parliament by law Article 115 or Article 116.

(2) The Legislature of a State may by law establish a Contingency Fund in the Nature of an imprest to be entitled “the Contingency Fund of the State” into which shall be paid from time to time such sums as may be determined by such law, and the said Fund shall be placed at the disposal of the Governor of the State to enable advances to be made by him out or such fund for the purposed of meeting unforeseen expenditure pending authorisation of such expenditure by the Legislature of the state by law under article 205 or article 206.

* * * * *

280. Finance Commission.—(1) The President shall, within two years from the commencement of this Constitution and thereafter at the expiration of every fifth year or at such earlier time as the President considers necessary by order constitute a Finance Commission which shall consist of a Chairman and four other members to be appointed by the President.

(2) Parliament may by law determine the qualification which shall be requisite for appointment as

members of the commission and the manner in which they shall be selected.

(3) It shall be the duty of the Commission to make recommendations to the President as to—

(a) the distribution between the Union and the States of the net proceeds of taxes which are to

be, or may be, divided between them under this Chapter and the allocation between the States of the

respective shares of such proceed;

(b) the principles which should govern the grant-in-aid if the revenues of the States out of the

Consolidated Fund of India;

(c) any other matter referred to the Commission by the President in the interest of sound finance.

(4) The Commission shall determine their procedure and shall have such powers in the performance

of their functions as Parliament may by law confer on them.

281. Recommendations of the Finance Commission.—The President shall cause evey

recommendation made by the Finance Commission under the provisions of this Constitution together

with an explanatory memorandum as to the action taken thereon to be laid before each House of

Parliament.

282. Expenditure defrayable by the Union or a State out of its revenues.—The Union or a State may

make any grants for any public purpose, notwithstanding that the purpose is not one with respect which

Parliament or the Legislature of the State, as the case may be, may make laws.

283. Custody, etc., of Consolidated Funds, Contingency Funds and moneys credited to the Public

Accounts.—(1) The custody of the Consolidated Fund of India and the Contingency Fund of India the

payment of moneys into such Funds, the withdrawal of moneys therefrom, the custody of public

moneys other than those credited to such Funds received by or on behalf of the Government of India,

and the withdrawal of moneys from such account and all other matters connected with or ancillary to

matters aforesaid shall be regulated by law made by Parliament, and, until provision in that behalf is so made, shall be regulated by rules made by the

President.

(2) The custody of the Consolidated Fund of a State and the Contingency Fund of a State, the

payment of moneys into such funds, the withdrawal of moneys therefrom, the custody of public

moneys other than those credited to such funds received by or on behalf of the Government of the

State, their payment into the public account of the State and the withdrawal of moneys from such

account and all other matters connected with or ancillary to matters aforesaid shall be regulated by law

made by the Legislature of the State, and, until provision in that behalf is so made, shall be regulated

by rules made by the Governor of the State.

284. Custody of suitors’ deposits and other moneys received by public servants and courts.—All

moneys received by or deposited with—

(a) any officer employed in connection with the affairs of the Union or of a State in his

capacity as such, other than revenues or public moneys raised or received by the Government of India

or the Government of the State, as the case may be, or

(b) any court within the territory of India to the credit of any cause, matter, account of

persons, shall be paid into the public account of India or the public account of the State, as the case

may be.

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290A. Annual Payment to certain Devaswom Funds.—A sum of forty-six lakhs and fifty thousand

rupees shall be charged on, and paid out of, the Consolidated Fund of the State of Kerala every year to

the Travancore Devaswom Fund; and a sum of thirteen lakhs and fifty thousand rupees shall be charged

on, and paid out, the Consolidated Fund of the State of Tamil Nadu every year to the Devaswom Fund

established in that State for the maintenance of Hindu temples and shrines in the territories transferred

to that State on the 1st day of November, 1956, from the state of Travancore-Cochin.

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293. Borrowing by States.—(1) Subject to the provisions of this article, the executive power of a

state extends to borrowing within the territory of India upon the security of the Consolidated Fund of the State within such limits,

if any, at may from time to time be fixed by the Legislature of such State by law and to the giving of

guarantees within such limits, if any, as may be so fixed.

(2) The Government of India may, subject to such conditions as may be laid down by or under

any law made by Parliament, make loans to any State or, so long as any limits fixed under Article 292

are not exceeded, give guarantees in respect of loans raised by any State, and any sums required for the

purpose of making such loans shall be charged on the Consolidated Fund of India.

(3) A state may not without the consent of the Government of India raise any loan if there is still

outstanding any part of a loan which has been made to the State by the Government of India or by its

predecessor Government, or in respect of which a guarantee has been given by the Government of

India or by its predecessor Government.

(4) A consent under clause (3) may be granted subject to such conditions, if any, as the

Government of India may think fit to impose.

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360. Provisions as to financial emergency.—(1) If the President is satisfied that a situation has

arisen whereby the financial stability or credit of India or of any part of the territory thereof is

threatened, he may by a Proclamation make a declaration to that effect.

(2) The provisions of clause (2) of article 352 shall apply in relation to a Proclamation issued under

this article as they apply in relation to a Proclamation of Emergency issued under Article 352.

(3) During the period any such Proclamation as in mentioned in clause (1) is in operation, the

executive authority of the Union shall extend to the giving of directions to any State to observe such

canons of financial propriety as may be specified in the directions, and to the giving of such other

directions as the President may deem necessary and adequate for the purpose.

(4) Notwithstanding anything in this constitution—

(a) any such direction may include—

(i) a provision requiring the reduction of salaries and allowances of all or any class of

persons serving in connection with the affairs of a State;

(ii) a provision requiring all Moneys Bills or other Bills to which the provisions of article

207 apply to be reserved for the consideration of the President after they are passed by

the Legislature of the State;

(b) it shall be competent for the President during the period any Proclamation issued under

this article is in operation to issue direction for the reduction of salaries and allowances of all or any

persons serving in connection with the affairs of the Union including the Judges of the Supreme Court

and the High Courts.

(5) Notwithstanding anything in this Constitution—

(a) the satisfaction of the President mentioned in clause (1) shall be final and conclusive and

shall not be questioned in any court on any ground;

(b) subject to the provisions of clause (2), neither the Supreme Court nor any other court shall

have jurisdiction to entertain any question on any ground, regarding the validity of—

(i) a declaration made by Proclamation by the President to the effect stated in clause (1); or

(ii) the continued operation of such Proclamation.

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366. Definitions.—In Constitution, unless the, context otherwise requires, the following expression

have the meanings hereby respectively assigned to them, that is to say—

(1) “agricultural income” means agricultural income as defined or the purposes of the

enactments relating to Indian income tax;

(4) “borrow” includes the raising of money by the grant of annuities, and “loan” shall be

construed accordingly;

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(6) “Corporation tax” means any tax on income so far as that tax is payable by companies and is

a tax in the case of which the following conditions are fulfilled:—

(a) that it is not chargeable in respect of agricultural income;

(b) that no deduction in respect of the tax paid by companies is, by any enactments which

may apply to the tax, authorised to be made from dividends payable by the companies to individuals;

(c) that no provision exists for taking the tax so paid into account in computing for the

purposes of Indian income tax the total income of individuals receiving such dividends, or in

computing the Indian income tax payable by, or refundable to, such individuals;

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(8) “debt” includes any liability in respect of any obligation to repay capital sums by way of

annuities and any liability under any guarantee, and “debt charges” shall be construed accordingly;

(9) “estate duty” means a duty to be assessed on or by reference to the principal value,

ascertained in accordance with such rules as may be prescribed by or under law made by Parliament or

the Legislature of a State relating to the duty, of all property passing upon death or deemed, under the

provisions of the said laws, so to pass;

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(12) “goods” includes all materials, commodities, and articles,

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(17) “pensions” means a pension, whether contributory or not, of any kind whatsoever payable

to or in respect of any person, and includes retired pay so payable, a gratuity so payable and any sum or

sums so payable by way of the return, with or without interest thereon any other addition thereto, of

subscriptions to a provident fund:

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(26) “securities” includes stock;

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(29) “tax on income” includes a tax in the nature of an excess profits tax;

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