Opinion

Why the Centre's dubious use of money bills must not go unchallenged

By bypassing the Rajya Sabha, the government is ignoring the Constitution's checks and balances against a democracy becoming a tyranny of the majority.

The government’s recent decision to pass the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, and amendments to the Foreign Contribution Regulation Act, 2010, and the Reserve Bank of India Act,1934, as money bills has stirred controversy. By virtue of being money bills, these could be passed by a simple majority in the Lok Sabha without the approval of the Rajya Sabha, where the government does not enjoy a majority. Naturally, those in the Opposition and many commentators see this as the government’s (illegitimate) method of bypassing the Parliamentary process. The government claims that once the Speaker of the Lok Sabha certifies a bill as “money bill”, the matter ends, as it is up to the discretion of the Speaker of the lower house to do so.

While it may seem that this is just another arcane debate on the rules of Parliamentary procedure, when probed deeper, it throws up questions on the very nature of constitutional governance and law making in India.

In terms of Parliamentary Procedure, under the Constitution, only money bills enjoy the exemption from being passed by the Rajya Sabha. The Constitution also clearly defines what is a money bill is. Article 110 (1) lists out seven features which a bill may possess in order to be a “money bill”. What is crucial is that the opening words of the clause mandate that in order to be a money bill, a bill has to have only any of these seven features. Any doubt about the scope of clause (1) is removed in clause (2) which states that a bill shall not become a money bill simply because it also happens to deal with the imposition of tax or a collection of a fee, apart from other objects. Where there is any doubt, the Speaker has the power under clause (3) to certify a bill as a “money bill”.

This division of bills into such categories is not unique to India. Similar provisions exist in other countries, but Article 110 is quite similar to Section 1 of the Parliament Act, 1911 passed in the UK. This law was introduced in the UK by the House of Commons to assert its dominance over the House of Lords, which had rejected a budget passed with a strong majority in 1909. What the 1911 Act did was to put into law a convention that the House of Lords would not veto or stall money bills passed by the House of Commons which reflected the will of the people.

While India has adopted the Westminster model of Parliamentary democracy, we have to keep in mind one important departure from the UK model: the written Constitution. Unlike England, where till recently, the power of Parliament to make laws was unrestrained, in India a written Constitution necessarily curtails the power of Parliament to make laws. It imposes not only substantive limits, that Parliament may not violate fundamental rights or encroach on “state subjects” while making law, it also dictates the procedure by which laws are made. While Parliament is no doubt supreme in determining its own procedure, it can do so only within the boundaries laid down by the Constitution.

Limits of power

The powers of the Speaker within Parliament is also not untrammelled. The post of the Speaker is a creation of the Constitution and the powers of the Speaker have to be exercised in accordance with the Constitution. When deciding whether a bill is a money bill, the Speaker does not have unlimited power but has to decide in accordance with the Constitution. Suppose, for instance, the Speaker were to certify a constitutional amendment bill as a “money bill”, such amendment would be null and void as the Speaker has no power to certify constitutional amendment as “money bills”, even if the amendment relates in some way to taxes. Such a decision of the Speaker to certify a bill as a money bill, contrary to clause (1) of Article 110 and thus, unconstitutional.

This line of reasoning should have spelt doom for the Aadhar Act, and other such laws had it not been for the Supreme Court's judgement in Mohammed Saeed Siddiqui v State of UP (2014). A three-judge bench of the Supreme Court upheld an Uttar Pradesh law, which was passed as a money bill, amending the Uttar Pradesh Lokayukta and Up-Lokayuktas Act, 1975, extending the term of the Lok Ayukta by two years. The court refused to strike down the law holding that once the Speaker had certified that a bill was a money bill, the Court would not review that decision and even if the Speaker erroneously certified a bill as a “money bill” it would only be a “procedural irregularity”. In doing so, the court relied on Article 212, which gives finality to the Speaker's decision on matters of Parliamentary Procedure in the context of the state legislative assembly and excludes the jurisdiction of any court from such decision.

The Supreme Court’s judgement in Mohammed Saeed Siddiqui is wrong for one glaring reason ‒ the court mistakes a category error for a “procedural irregularity”. When the Constitution provides different, mutually exclusive procedures in passing a money bill, a non-money bill and a constitutional amendment bill, an error of categorisation results in an entirely wrong procedure being followed in passing the bill. A procedural irregularity would arise if, after correct categorisation, there is some lapse in procedure relating to a non-mandatory clause. But when the initial categorisation itself is incorrect, this is a substantive illegality.

From this, it follows that the Court’s conclusion, that it could not review the decision of the Speaker because of Article 212 is clearly wrong. As multiple constitution benches in the context of anti-defection law and disqualification of members have held, Article 212, and its counterpart for the Union Parliament, Article 122 do not take away from the jurisdiction of courts to address a substantive illegality committed by the Speaker in exercise of her powers under the Constitution.

Since the provisions relating to money bills in the state legislature and the Union Parliament are identical, the line of reasoning adopted by the Supreme Court in Mohammed Saeed Siddiqui would apply to any challenge to the Aadhar Act, FCRA and RBI Amendments as well.

Shaky ground

Yet, the fundamental infirmities in the legal reasoning given by the Supreme Court suggest that it may be the right time for a complete re-look at the law laid down in Mohammed Saeed Siddiqui’s case. With court on Tuesday agreeing to hear the challenge to the Aadhar Act in July, this is an opportunity to correct the conceptual confusion at the heart of Mohammed Saeed Siddiqui's case.

No doubt the Lok Sabha enjoys the popular mandate in a way that the Rajya Sabha, being composed of indirectly elected and nominated members, does not, and never will. That is not to say that the Rajya Sabha plays no meaningful role in the passage of laws. The constitution framers were well aware that a simple majority of seats in the Lok Sabha should not be the basis for fundamental and far reaching changes without sober discussion and a broad consensus among society. The Rajya Sabha is one of the many checks and balances put in place to prevent a constitutional democracy from becoming a mere tyranny of the majority. In addressing the debate of what is a money bill and what is not, one hopes that the Supreme Court keeps this constitutional principle in mind and keeps Parliament within the bounds of the Constitution, as it has done before.

We welcome your comments at letters@scroll.in.
Sponsored Content  BY 

Harvard Business School’s HBX brings the future of business education to India with online programs

HBX is not only offering courses online, but also connecting students to the power of its network.

The classic design of the physical Harvard Business School (HBS) classroom was once a big innovation – precisely designed teaching amphitheaters laid out for every student to participate from his or her seat with a “pit” in the center of the room from which professors orchestrate discussions analyzing business cases like a symphony lead. When it came to designing the online experience of HBX—the school’s digital learning initiative—HBS faculty worked tirelessly to blend these tenets of the HBS classroom pedagogy with the power of new technology. With real-world problem solving, active learning, and social learning as its foundation, HBX offers immersive and challenging self-paced learning experiences through its interactive online learning platform.

Reimagining digital education, breaking the virtual learning mold

Typically, online courses follow a one-way broadcast mode – lectures are video recorded and reading material is shared – and students learn alone and are individually tested. Moving away from the passive learning model, HBX has developed an online platform that leverages the HBS ‘case-based pedagogy’ and audio-visual and interaction tools to make learning engaging.

HBX courses are rarely taught through theory. Instead, students learn through real-world problem-solving. Students start by grappling with a business problem – with real world data and the complexity in which a business leader would have to make a decision – and learn the theory inductively. Thus even as mathematical theories are applied to business situations, students come away with a greater sense of clarity and perspective, whether it is reading a financial report, understanding why a brand’s approach to a random sample population study may or may not work, or how pricing works.

HBX Platform | Courses offered in the HBX CORe program
HBX Platform | Courses offered in the HBX CORe program

“Learning about concepts through real-life cases was my favorite part of the program. The cases really helped transform abstract concepts into observable situations one could learn from. Furthermore, it really helped me understand how to identify situations in which I could use the tools that HBX equipped me with,” says Anindita Ravikumar, a past HBX participant. India’s premier B-school IIM-Ahmedabad has borrowed the very same pedagogy from Harvard. Learning in this manner is far more engaging, relatable, and memorable.

Most lessons start with a short 2-3 minute video of a manager talking about the business problem at hand. Students are then asked to respond on how they would handle the issue. Questions can be in the form of either a poll or reflections. Everyone’s answers are then visible to the ‘classroom’. In the words of Professor Bharat Anand, Faculty Chair, HBX, “This turns out to be a really important distinction. The answers are being updated in real-time. You can see the distribution of answers, but you can also see what any other individual has answered, which means that you’re not anonymous.” Students have real profiles and get to know their ‘classmates’ and learn from each other.

HBX Interface | Students can view profiles of other students in their cohort
HBX Interface | Students can view profiles of other students in their cohort

Professor Anand also says, “We have what we call the three-minute rule. Roughly every three minutes, you are doing something different on the platform. Everyone is on the edge of their seats. Anyone could be called on to participate at any time. It’s a very lean forward mode of learning”. Students get ‘cold-called’ – a concept borrowed from the classroom – where every now and then individuals will be unexpectedly prompted to answer a question on the platform and their response will be shared with other members of the cohort. It keeps students engaged and encourages preparedness. While HBX courses are self-paced, participants are encouraged to get through a certain amount of content each week, which helps keep the cohort together and enables the social elements of the learning experience.

More than digital learning

The HBS campus experience is valued by alumni not just for the academic experience but also for the diverse network of peers they meet. HBX programs similarly encourage student interactions and opportunities for in-person networking. All HBXers who successfully complete their programs and are awarded a credential or certificate from HBX and Harvard Business School are invited to the annual on-campus HBX ConneXt event to meet peers from around the world, hear from faculty and business executives, and also experience the HBS campus near Cambridge.

HBXers at ConneXt, with Prof. Bharat Anand
HBXers at ConneXt, with Prof. Bharat Anand

Programs offered today

HBX offers a range of programs that appeal to different audiences.

To help college students and recent graduates prepare for the business world, HBX CORe (Credential of Readiness) integrates business essentials such as analytics, economics, and financial accounting. HBX CORe is also great for those interested in an MBA looking to strengthen their application and brush up their skills to be prepared for day one. For working professionals, HBX CORe and additional courses like Disruptive Strategy, Leading with Finance, and Negotiation Mastery, can help deepen understanding of essential business concepts in order to add value to their organizations and advance their careers.

Course durations range from 6 to 17 weeks depending on the program. All interested candidates must submit a free, 10-15 minute application that is reviewed by the HBX admissions team by the deadlines noted on the HBX website.

For more information, please review the HBX website.

This article was produced by the Scroll marketing team on behalf of HBX and not by the Scroll editorial team.