Not all bills in Parliament follow the same path. This article covers how different types of bills move through Parliament, how Parliament controls government spending, and what actually happens to a pending bill when the Lok Sabha dissolves.
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Must Know.
The Core Rules.
- Bill Types. Parliament passes several distinct types of bills: Ordinary Bills, Money Bills, Financial Bills, and Constitutional Amendment Bills. Each follows a different procedure.
- Money Bills. A Money Bill can only be introduced in the Lok Sabha. The Rajya Sabha cannot reject or substantially amend it, only offer recommendations.
- Joint Sitting Majority. A bill taken up at a joint sitting of both Houses needs only a simple majority of members present and voting, from both Houses combined — no special majority is required.
- Consolidated Fund. The Consolidated Fund of India holds all government revenue and receipts. Money can only be withdrawn from it with Parliament’s approval.
- Contingency Fund. The Contingency Fund of India is a smaller emergency reserve. The government can draw on it for unforeseen expenditure, without waiting for prior parliamentary approval.
- UPSC 2015 The Union Budget is prepared by the Budget Division of the Department of Economic Affairs, not the Department of Revenue. Disbursements from the Public Account, unlike the Consolidated Fund, do NOT need Parliament’s authorization — that money doesn’t belong to the government in the same way. Asked as: “With reference to the Union Government, consider the following statements.” (UPSC CSP 2015, GS Paper I).
- UPSC 2023 A Finance Bill (one that isn’t also a Money Bill) can be amended or even rejected by the Rajya Sabha, unlike a true Money Bill, which the Rajya Sabha can only make recommendations on. Article 108 makes a joint sitting *possible* for resolving a Finance Bill deadlock — it doesn’t become *necessary*, and a Money Bill never goes to a joint sitting at all. Asked as: “With reference to Finance Bill and Money Bill in the Indian Parliament, consider the following statements.” (UPSC CSP 2023, GS Paper I).
Good to Know.
Committees and the Money-Bill Question.
- Public Accounts Committee. This committee examines government spending after the fact. It checks whether money was actually spent as Parliament had authorized.
- Estimates Committee. This committee examines the government’s budget estimates in advance. It suggests ways to improve efficiency and economy in spending.
- Money Bill vs. Financial Bill. Distinguishing a Money Bill from an ordinary Financial Bill matters practically. Only Money Bills carry the Rajya Sabha’s limited-power restriction, and the Speaker of the Lok Sabha has the final say on that classification.
- Joint Sessions. A deadlock over an ordinary bill can be resolved through a joint session. Money Bills bypass this entirely, since the Rajya Sabha’s role there is already limited by design.
- RS Money-Bill Limits. The Rajya Sabha cannot reject or amend a Money Bill, and cannot vote on the Demands for Grants either. It CAN still discuss the Annual Financial Statement (the Budget) — it just cannot vote on it.
When Bills Lapse.
mcqquestion.comFive Scenarios on Dissolution.
- Pending in Lok Sabha. A bill pending in the Lok Sabha, whether it originated there or was transmitted from the Rajya Sabha, lapses when the Lok Sabha dissolves.
- Passed by Lok Sabha. A bill passed by the Lok Sabha but still pending in the Rajya Sabha also lapses on dissolution of the Lok Sabha.
- Pending in Rajya Sabha Only. A bill that originated in, and is pending only in, the Rajya Sabha does not lapse, since the Rajya Sabha is a permanent body that never dissolves.
- Notified Joint Sitting. Under Article 108(5), if the President has already notified an intention to summon a joint sitting on a bill, that bill does not lapse. The joint sitting can still be held after dissolution.
- Awaiting Assent. A bill passed by both Houses but still awaiting the President’s assent does not lapse, regardless of dissolution.
Previous Year Question.
Asked as: “With reference to the Indian Parliament, consider the following statements. Which of the statements given above is/are correct?” (on bills lapsing upon dissolution). This was asked in UPSC CSP 2024, GS Paper I. View this question.
Previous Year Question.
Asked as: “A Bill pending in the Lok Sabha lapses on its prorogation” — this is false, a bill does NOT lapse on prorogation, only on dissolution. This was asked in UPSC CSP 2016, GS Paper I. See UPSC CSP 2016, Q1.
Test Yourself.
Great to Know.
Why the System Works This Way.
- Lok Sabha Control. Giving the Lok Sabha exclusive control over Money Bills reflects a common logic in parliamentary systems. The directly elected house, more accountable to voters on tax-and-spend decisions, should have the final word on how public money is raised and spent.
- The Speaker’s Classification Power. The Speaker’s power to classify a bill as a Money Bill has real political weight. That classification alone determines how much influence the Rajya Sabha has over the bill, a decision that has occasionally been challenged in court.
- Two Committees, One Cycle. The Public Accounts Committee and the Estimates Committee work as a pair, covering the full spending cycle. Estimates comes before the money is spent, Public Accounts after, together giving Parliament oversight at both ends of the process.
- A Permanent vs. Temporary House. The lapsing rules exist because the Lok Sabha is not permanent, but the Rajya Sabha is. A bill’s fate on dissolution largely depends on which House still holds it, and whether the President has already acted to save it via a notified joint sitting.
Previous Year Questions
Asked as: “With reference to the Parliament of India, consider the following statements on private member’s bills.” (UPSC CSP 2017, GS Paper I). Neither statement is correct — a private member is simply any MP who is not a minister (not a “nominated” member), and private member’s bills have in fact passed before: 14 have become law since 1952. View this question.
Asked as: “Consider the following statements regarding the Rajya Sabha’s powers over Money Bills, Demands for Grants, and the Annual Financial Statement.” (UPSC CSP 2015, GS Paper I). Statements 1 and 2 are correct; the Rajya Sabha can still discuss the Annual Financial Statement (Budget) in full, even though it can’t vote on it. View this question.
Asked as: “When a bill is referred to a joint sitting of both the Houses of the Parliament, it has to be passed by.” (UPSC CSP 2015, GS Paper I). The correct answer is a simple majority of members present and voting, under Article 108. View this question.
Asked as: “Which of the following statements is/are correct, on bills pending in the Lok Sabha and Rajya Sabha and what happens to them on prorogation or dissolution?” (UPSC CSP 2016, GS Paper I). Only statement 2 is correct — prorogation does not lapse a pending bill, only dissolution of the Lok Sabha does, and only for bills pending there; the Rajya Sabha, being a permanent body, is unaffected. View this question.
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