The Constitution of India
Article 110
Definition 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 Government of India, or the amendment of the law with respect to any financial obligations undertaken or to be undertaken by the Government of India;
(c) the custody of the Consolidated Fund or the Contingency Fund of India, 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 India;
(e) the declaring of any expenditure to be expenditure charged on the Consolidated Fund of India or the increasing of the amount of any such expenditure;
(f) the receipt of money on account of the Consolidated Fund of India or the public account of India or the custody or issue of such money or the audit of the accounts of the Union or of a State; or
(g) any matter incidental to any of the matters specified in 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 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) If any question arises whether a Bill is a Money Bill or not, the decision of the Speaker of the House of the People thereon shall be final.
(4) There shall be endorsed on every Money Bill when it is transmitted to the Council of States under article 109, and when it is presented to the President for assent under article 111, the certificate of the Speaker of the House of the People signed by him that it is a Money Bill.
Why this exists
Modelled on the British parliamentary tradition (like the UK's Parliament Act 1911), this Article ensures that decisions about taxation and government spending — matters directly tied to public money and democratic accountability — rest primarily with the directly elected House (Lok Sabha). The Rajya Sabha's limited role on Money Bills (only recommending changes, not blocking them) reflects the idea that the 'power of the purse' should follow the will of directly elected representatives, while giving the Speaker a gatekeeping role to prevent misuse of ordinary legislative process.
How courts read it
The Supreme Court has grappled with whether the Speaker's 'final' certification under clause (3) is beyond judicial review. In K.S. Puttaswamy v. Union of India (2018), a majority upheld the passage of the Aadhaar Act as a Money Bill, though this drew a strong dissent from Justice Chandrachud, who argued it was not truly a Money Bill and warned against using the mechanism to bypass the Rajya Sabha. Subsequently, in Rojer Mathew v. South Indian Bank (2019), a five-judge bench doubted the correctness of the Aadhaar ruling on this point and referred the question of whether Money Bill certification is judicially reviewable to a larger bench, leaving the issue unsettled as of recent years.
Common misconceptions
- Myth: Any Bill that involves money in some way is a Money Bill.
Fact: Article 110(1) requires that the Bill deal ONLY with the specific matters listed (taxes, borrowing, Consolidated Fund, etc.) — a Bill with other substantial provisions isn't a Money Bill just because it also has financial elements. - Myth: The Speaker's certification of a Bill as a Money Bill can never be questioned in court.
Fact: While Article 110(3) says the Speaker's decision is 'final,' the Supreme Court in Rojer Mathew v. South Indian Bank (2019) left open whether this decision is subject to judicial review, referring the question to a larger bench. - Myth: Local taxes imposed by municipalities or panchayats make a Bill a Money Bill.
Fact: Clause (2) expressly excludes taxes imposed by local authorities for local purposes from the definition of a Money Bill.