Money Bill passed to increase judges’ number: Why this route faces legal challenge

The Statement of Objects and Reasons of the Bill cites the expenditure involved in creating four additional posts of judges, along with staff, residences and security.

“This will increase the expenditure on account of pay and allowances on creation of four additional posts of Judges in the Supreme Court along with required staff. The Judges will also be entitled to the use of a rent-free official residence. Each Judge will have to be provided with personal staff at residence and office. Expenditure would also be incurred in connection with the deployment of security for Judges. ⁠The estimated recurring expenditure on salaries of four Judges and their staff, conveyance and other miscellaneous expenses would be rupees 10,56,81,648 per annum and non-recurring expenditure towards car and furnishing of official residence and other miscellaneous expenses will be approximately rupees 3,47,36,000. Thus, the total expenditure on creation of additional four posts of Judges in the Supreme Court of India will be of rupees 14,04,17,648 approximately,” the Bill stated.

Why the Money Bill route remains controversial

The issue of whether a Bill can be certified as a money Bill is a key question pending for consideration by a seven-judge Constitution Bench. In 2023, the then Chief Justice of India D Y Chandrachud had said that the case would be listed for hearing soon. However, the issue is yet to be taken up.

Article 110 of the Constitution deals with money Bills. A money Bill is a Bill that, in the opinion of the Speaker of the Lok Sabha, deals with taxation, appropriation of public funds – the Consolidated Fund of India or the Contingency Fund of India.

A money Bill can only be introduced in the Lok Sabha, and the Speaker categorising a Bill as a “money Bill” means that it need not be passed by the Rajya Sabha. The Union Budget, for example, is a money Bill. Article 110(1) (g) adds that “any matter incidental to any of the matters specified in Articles 110(1)(a)-(f)” can also be a money Bill. This additional clause has been the basis for the Modi government to pass key legislations as money Bills in its previous terms. The Opposition had argued then that this was done only because the government did not have the numbers to get these legislations cleared in the Rajya Sabha.

The constitutionality of three major laws, including the Prevention of Money Laundering Act, are yet to be examined by the larger bench in the light of whether these laws qualify to be passed as a money Bill. The other two are the Aadhaar Act and the 2017 amendments altering service conditions of Tribunals.

While the PMLA and Aadhaar Act were substantially upheld by the Court, the Supreme Court struck down the tribunal amendments as unconstitutional. However, in both rulings the issue of money Bill was left to a larger bench to decide.

Justice D Y Chandrachud, the lone dissenter in the Aadhaar ruling of 2018, criticised the government for passing the Aadhaar Act as a money Bill. He had called it a “fraud on the Constitution” and “subterfuge”. The government had argued that since the subsidies distributed through Aadhaar flow from the Consolidated Fund of India, the law is validly categorised as a money Bill.

Later, a five-judge bench of the Supreme Court in 2019 struck down the law as unconstitutional for interfering with judicial independence; it referred the money Bill aspect to a larger Constitution Bench.

In doing so, the Court also expressed doubts over the correctness of a five-judge Constitution Bench’s 2018 verdict upholding the Aadhaar Act, which had been passed as a money Bill.