Article 204 of the Indian Constitution delineates the meticulous procedure for the passage of Appropriation Bills. As the financial bedrock of government operations, these bills hold immense significance, authorizing the disbursement of funds from the exchequer to various sectors and endeavors.
What does Article 204 states ?
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 or either House of the Legislature of the State 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 the State, 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(3) Subject to the provisions of articles 205 and 206, no money shall be withdrawn from the Consolidated Fund of the State except under appropriation made by law passed in accordance with the provisions of this article.
Clauses of Article 204
Clause(1) :-
- In the Indian Constitution, Article 204 establishes the Appropriation Bill, which is mandated to allocate funds from the Consolidated Fund of the State.
- According to Article 203, once the awards have been approved by the Assembly, a Bill is then filed to facilitate the progression of the process and authorize the disbursement of funds.
- With that being stated, it is imperative to ensure that the Bill, prior to its enactment, exclusively encompasses grants that have been sanctioned by the Assembly and that the allocated funds do not surpass the projected expenses outlined in the Annual Financial Statement.
Clause(2) :-
- According to the second article, it is stipulated that any modifications to the House of the Legislature of the State are prohibited if they seek to modify the grants’ magnitude or their designated objectives. Additionally, any amendments that aim to alter the amount of money charged to the Consolidated Fund are also prohibited.
- The individual who exercises authority over the legislative proceedings, such as the Speaker, Deputy Speaker of the house, or Chairman, possesses ultimate discretion in determining the acceptability of an amendment within the confines of this article.
Clause(3) :-
- According to this provision, it is stipulated that any withdrawal of funds from the Consolidated Fund can only be carried out through a prescribed procedure known as appropriation.
- This include the Annual Financial Statement, the funds approved by the Assembly, and the grants falling within the purview of Articles 205 and 206, such as Supplementary funds, Additional Grants, Exceptional Grants, and so on.
Procedure for passing an Appropriation Bill
- Presentation of the Budget: The process begins with the presentation of the annual budget by the Finance Minister in the Lok Sabha. The budget outlines the estimated revenue and expenditure for the upcoming fiscal year. It includes details of various government departments’ financial requirements.
- Discussion on Demands for Grants: After the budget presentation, there are discussions on Demands for Grants. These are proposals made by different government ministries and departments, outlining their financial needs for the upcoming year. Members of Parliament (MPs) examine and discuss these demands to understand the allocation of funds for various sectors.
- Scrutiny by Parliamentary Committees: Parliamentary Standing Committees and Department-related Parliamentary Standing Committees examine the Demands for Grants in detail. These committees analyze the budgetary allocations and can make recommendations for changes if needed.
- Passage of the Appropriation Bill: Once the discussions on Demands for Grants are concluded, the Appropriation Bill is introduced in the Lok Sabha. This bill provides the legal authority for the government to withdraw funds from the Consolidated Fund of India to meet the expenditures specified in the Demands for Grants.
- Three Readings and Voting: The Appropriation Bill goes through three readings in the Lok Sabha. During the first reading, the bill’s title and objectives are introduced. The second reading involves a general discussion on the bill’s principles. The third reading is the final stage, where specific clauses are debated, and a vote is taken.
- Transmission to Rajya Sabha: After passing the Lok Sabha, the bill is sent to the Rajya Sabha (upper house) for consideration. The Rajya Sabha can discuss the bill, suggest amendments, and make recommendations. However, it cannot amend the bill to increase or change the allocation of funds, as it involves expenditure.
- Return to Lok Sabha: If the Rajya Sabha suggests any amendments, the bill is sent back to the Lok Sabha for consideration. The Lok Sabha can either accept or reject the amendments proposed by the Rajya Sabha.
- President‘s Assent: Once both houses agree on the final version of the bill, it is sent to the President for assent. Upon receiving the President‘s assent, the Appropriation Bill becomes law, allowing the government to withdraw funds from the Consolidated Fund for the purposes specified in the bill.