Polity

Types of Funds in Constitution of India

Types of Funds in Constitution of India

  • The Constitution of India provides for the following funds for the Central government –
      1. Consolidated Fund of India (Article 266)
      2. Public Account of India (Article 266)
      3. Contingency Fund of India (Article 267)

Types of Funds in Constitution of India, Consolidated Fund of India, Public Account of India, Contingency Fund of India, Difference between them... Complete Notes on Indian Polity

Consolidated Fund of India

    • Funds to which all receipts are credited and all payments are debited.
    • It is a funds which receives –
        1. All revenues (tax and non-tax revenues) collected by the Government
        2. All loans raised by the government by the issue of treasury bills, loans and means of advance.
        3. All money received by the Government in repayment of loans from the consolidated funds of India.
    • No money out of this fund can be drawn except in accordance with a parliamentary law.
    • All the legally authorised payments on behalf of the Government of India are made out of this fund.

 

Public Account of India

    • All the money received by the Government not forming part of Consolidated Fund is deposited into this account.
    • This includes provident fund deposits, judicial deposits, savings bank deposits, departmental deposits, remittances and so on.
    • This account is operated by executive action, that is, the payments from this account can be made without parliamentary appropriation.

 

Contingency Fund of India

    • The Constitution authorised the Parliament to establish a ‘Contingency Fund of India’, into which amounts determined by law are paid from time to time.
    • The fund is held by the finance secretary on behalf of the president.
    • It is also operated by executive action.
    • The present corpus of Contingency Fund is Rs. 500 crores.
    • In case of emergencies and urgent requirements, the money can be spent from the Contingency Fund without the prior approval from the Parliament.
    • Approval of the Parliament is obtained subsequently. The money spent from this Fund is reimbursed by the Consolidated Fund.
    • This way, the corpus of the Contingency Fund is always maintained.

These accounts are of the Central Government. Each of the State Government have separate Consolidated Fund, Contingency Fund and the Public Account, i.e. each of the states have these funds.

 

Difference between the Different Types of Funds in Constitution of India

Name of the fund

Consolidated Fund of India

Public Accounts of India

Contingency Funds of India

Article

266

266

267

Purpose

Revenues (Tax & Non Tax) Treasury Bills

Whereas and means Advance

All other public money received by government (other than that goes to Consolidated Fund) Eg. PF, Post Office Saving etc.

To meet emergency expenditure fund size is determined by Parliament

 

Custody

Parliament

Executive

President (Finance Secretary handles it) Post expenditure Parliament approves it

Income

Taxes and non-tax revenue

Public money other than those under consolidated fund

Fixed corpus of Rs. 500 crore

Expenditure

All expenditure

 

Unforeseen expenditure

Parliamentary Authorisation
required

Prior to expenditure

 Not required

After the expenditure

 

 

So, this was all about the Different Types of Funds in Constitution of India.

In the Next Post (Click Here), we will study about the Parliamentary Privileges and its Classification.

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