The Supreme Court of India is poised to address pivotal questions concerning the definition and use of a Money Bill. This examination stems from the 2019 verdict in Rojer Mathew vs South Indian Bank Ltd., where the legitimacy of the Finance Act, 2017, certified as a Money Bill, was contested. The Finance Act significantly restructured 26 tribunals, abolished some, merged others, set qualifications for appointments, and outlined service conditions. These extensive changes raised doubts about whether the Act met the strict criteria for a Money Bill.
The Finance Act, 2017, included provisions that went beyond the scope defined in Article 110(1). While some aspects, like tribunal members’ salaries paid from the Consolidated Fund, might fit within the Money Bill framework, the Act also made substantive changes to laws governing tribunals and granted extensive regulatory powers to the executive. These changes seemed to exceed the permissible boundaries of a Money Bill, making the Act a potential “colourable exercise of power”—a legal term indicating the misuse of legislative power to achieve an objective indirectly that could not be done directly.
The five-judge Bench in Rojer Mathew found itself limited by the prior ruling in K.S. Puttaswamy vs Union of India (2018), which upheld the Aadhaar Act as a Money Bill.
A critical aspect of this judicial review is its impact on India’s federal structure and the balance of power. The Rajya Sabha, representing the states and serving as a check on the Lok Sabha, plays a vital role in maintaining federal integrity. Justice D.Y. Chandrachud, in his concurring opinion in Rojer Mathew, emphasized the Rajya Sabha’s indispensable role in India’s constitutional framework. Bypassing the Upper House by misclassifying Bills as Money Bills undermines this balance and dilutes the Rajya Sabha’s function as a deliberative body.
The Supreme Court’s upcoming decision on the definition and use of Money Bills will have far-reaching consequences. It will clarify the constitutional boundaries of legislative processes, safeguard the federal structure, and ensure that the Rajya Sabha’s role is not circumvented. This ruling will be pivotal in maintaining the integrity of the Constitution and the democratic principles it upholds.
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