Speaker's certification of money bills

Also called: Article 110(3) · Topic: Parliamentary Procedure, Committees and Privileges · NCERT: Beyond NCERT

Meaning

Speaker's certification of money bills means the Lok Sabha Speaker decides whether a bill is a money bill, and under Article 110(3) that decision is final [1][2]. A money bill is a bill that deals only with taxes, government borrowing, and money going into or out of the Consolidated Fund of India [2].

Why it matters:

• Once the Speaker certifies a bill as a money bill, the Rajya Sabha can only suggest changes, and only for 14 days [1].
• So the certificate decides whether the Council of States (the Rajya Sabha, the House that speaks for the states) gets a real say on a law.
• Whether courts can check this certificate is a question still before a seven-judge bench of the Supreme Court [3][4].

Explanation

What the Speaker certifies

• A bill is a money bill only if it deals only with the matters in Art. 110(1)(a)–(g):
• (a) putting on, removing, changing or regulating a tax;
• (b) government borrowing or guarantees;
• (c) keeping the Consolidated Fund (the government's main account) or the Contingency Fund (its emergency fund), and paying money into or out of them;
• (d) appropriation (permission to spend) from the Consolidated Fund;
• (e) declaring any spending to be "charged" (spending that needs no vote of Parliament, such as judges' salaries);
• (f) receiving money into the Consolidated Fund or the public account, or auditing these accounts;

• (g) any matter incidental to (a)–(f), meaning closely linked to them.

• Art. 110(2): a bill is not a money bill just because it provides for fines, licence fees or fees for services. Bills about local-body taxes are not money bills either.

• If a bill has some Art. 110 matters plus other matters, it is a Category I financial bill (Art. 117(1)), not a money bill [2]. Example: the Compensatory Afforestation Fund Bill, 2015 [2].

How the certificate works: steps of a money bill

1. Recommendation and introduction: the President recommends the bill, and it is introduced in the Lok Sabha only (Art. 109(1), Art. 117(1)) [1].
2. Lok Sabha vote: the bill passes by a simple majority (more yes votes than no votes among members present and voting).
3. Certificate: the Speaker certifies it as a money bill. Under Art. 110(4), the Speaker signs the certificate on the bill when it goes to the Rajya Sabha and to the President.
4. Rajya Sabha: it must return the bill within 14 days, with or without recommendations [1]. It cannot amend or reject the bill.
5. Lok Sabha again: it may accept or reject any recommendation [2].
6. Deemed passing: if the Rajya Sabha does not return the bill within 14 days, both Houses are deemed to have passed it (Art. 109(5)) [2].
7. President: assents to it. The President cannot return a money bill for reconsideration (Art. 111 proviso) [1]. - No joint sitting (Art. 108) is ever needed or allowed for a money bill. The Lok Sabha always has the last word [1].

Limits: why the certificate is so powerful, and the open question

• Art. 110(3): if there is a question about whether a bill is a money bill, the Speaker's decision is final [1][2].

• It is the Lok Sabha Speaker who decides. Neither the President nor the Rajya Sabha Chairman has this power.

• Art. 122: courts cannot question Parliament's proceedings on the ground of "irregularity of procedure" (a mistake in how the House followed its rules).

• What the certificate does in practice:
• A bill marked "money bill" escapes the Rajya Sabha's veto.
• So the states lose their voice in Parliament.

• A government without a majority in the Rajya Sabha can still pass the law.

• The central legal question: is the certificate open to judicial review (the courts' power to check whether an action is legal)? Or does Art. 110(3) shut out the courts completely [4]?

In the Constitution and practice

• Constitutional basis:
• Art. 109 sets out the special procedure for money bills.
• Art. 110(1)–(2) defines a money bill.
• Art. 110(3) makes the Speaker's decision final.
• Art. 110(4) requires the Speaker's certificate on the bill.
• Art. 122 protects Parliament's proceedings from the courts.

• For states, Art. 199 deals with money bills and Art. 212 protects state legislatures' proceedings.

• Origin: this is taken from the UK Parliament Act 1911. There, the Speaker of the House of Commons certifies money bills, and the certificate is final. The House of Lords can delay a money bill by one month. India's Rajya Sabha gets 14 days.

• K.S. Puttaswamy (Aadhaar), 2018:
• A five-judge bench upheld the Aadhaar Act, 2016 as a money bill, 4:1.
• Majority:
  • Section 7 of the Act links subsidies and benefits paid from the Consolidated Fund to Aadhaar [4].
  • The other provisions were incidental to this core, so the Act was correctly certified [4].
• Justice D.Y. Chandrachud's dissent:
  • Courts can review the certificate. Calling it "final" does not protect an unconstitutional act.
  • Passing the Act as a money bill was "a fraud on the Constitution" because it took away the Rajya Sabha's role.

• January 2021: the Court dismissed review petitions against the ruling by majority. Justice Chandrachud dissented and said the review should wait for the larger bench [4].

• Rojer Mathew v. South Indian Bank, November 2019 (five judges):

• Part XIV of the Finance Act, 2017, which was passed as a money bill, let the Centre make rules on tribunal members.
• The Court struck down the Tribunal Rules, 2017 because they threatened the independence of tribunals.
• It doubted the Aadhaar majority's reading of Art. 110 and referred the money-bill question to a seven-judge bench [3][4].

• Questions for the larger bench [4]:

  • What counts as a money bill?
  • How far can courts review the Speaker's certificate?
  • Was the Aadhaar ruling on this point correct?

• Later cases that left the question to the larger bench:

• Vijay Madanlal Choudhary (2022): changes to the PMLA, 2002 had been made through Finance Acts. A three-judge bench upheld the PMLA's main provisions and left the money-bill objection to the larger bench.

• Electoral bonds (ADR v. Union of India, 15 February 2024):

  • The scheme came through the Finance Act, 2017.
  • The Court noted that the scope of Art. 110 was pending before the seven-judge bench [3].
  • It struck the scheme down under Art. 19(1)(a) (voters' right to information about political funding). It did not decide the money-bill point.

• Status: the seven-judge reference was still pending in February 2024 [3].

Don't confuse with

• Financial bill, Category I (Art. 117(1)): like a money bill, it is introduced only in the Lok Sabha with the President's recommendation. But it is not certified as a money bill, so the Rajya Sabha has full power to amend or reject it, and a joint sitting is possible [2].
• Rajya Sabha Chairman / President: neither decides whether a bill is a money bill. Only the Lok Sabha Speaker does (Art. 110(3)).
• Speaker's decision under the Tenth Schedule (anti-defection law): that "final" decision is open to judicial review (Kihoto Hollohan, 1992). Whether the money-bill certificate can be reviewed is still pending before the seven-judge bench.
• Joint sitting (Art. 108): it settles deadlocks over ordinary and financial bills. A certified money bill never goes to a joint sitting [1].

Prelims Hooks

• Art. 110(3): the Speaker of the Lok Sabha makes the final decision on whether a bill is a money bill [1][2]. Art. 110(4): the Speaker's certificate goes with the bill to the Rajya Sabha and to the President.
• Art. 109: the Rajya Sabha must return a money bill within 14 days [1]. If it does not, the bill is deemed passed by both Houses (Art. 109(5)) [2].
• Art. 111 proviso: the President cannot return a money bill for reconsideration [1].
• Art. 110(2) trap: bills that only provide for fines, licence fees, fees for services or local-body taxes are not money bills.
• Puttaswamy (2018): Aadhaar Act 2016 upheld as a money bill, 4:1. Justice Chandrachud called it a "fraud on the Constitution".
• Rojer Mathew (2019): the money-bill question was referred to a seven-judge bench [3][4]. Electoral bonds (2024): struck down under Art. 19(1)(a), not on the money-bill ground.

Mains Points

• Federalism and bicameralism (having two Houses of Parliament):
• Laws with wide general content have been certified as money bills: the Aadhaar Act 2016, Part XIV of the Finance Act 2017, and PMLA amendments.
• This lets the government go around the Council of States.

• It weakens the Rajya Sabha's role as the voice of the states and as a careful second check on laws.

• Judicial review vs. parliamentary privilege:

• Art. 110(3) and Art. 122 protect the Speaker's decision.
• But courts have reviewed other "final" Speaker decisions, as in Kihoto Hollohan (1992).

• A middle path: courts check only whether the bill falls within Art. 110(1)(a)–(g), not how the House ran its proceedings. The pending seven-judge reference should settle this.

• Reform ideas:

• The Speaker should give written reasons for the certificate.
• In doubtful cases, the Speaker should consult the Rajya Sabha Chairman or a joint committee.
• Read "only" in Art. 110(1) strictly, so that any bill with a non-money matter is treated as a Category I financial bill.
• Learn from UK practice, where the Speaker consults senior officials before certifying.

Related concepts

• Bill
• Government bill
• Private member's bill
• Rojer Mathew case

Read more

• Kinds of bills and the money-bill dispute