The Delhi Budget Brouhaha and Why It Shouldn't Have Happened

The delay in the presentation of the budget in the Delhi assembly due to the reservations of the constitutional head about some allocations, or alleged bureaucratic machinations at different levels, baffles students of the constitution.

Article 112 of the constitution requires the President to have the budget presented before both Houses of parliament. Similarly, under Article 202, the governor of a state is required to have the budget presented before both Houses of the state legislature. These two provisions of the constitution follow the British practice of the sovereign placing before the House of Commons the annual financial statement, which is otherwise known as the budget.

The basic constitutional principle is that the executive demands money and the house of the people grants it. Erskine May, a great authority on British Parliamentary practice, says, “The crown demands money, the commons grants it, and the Lords assent to the grant.”

Preparation of the budget is the exclusive prerogative of the executive headed by the prime minister or the chief minister. The annual budget contains the receipts and expenditure which reflect the policy of the elected government. It is the policy of that government to tax or not to tax a particular economic activity or a section of the population. Similarly, allocations for different activities or schemes are also made in accordance with the policy of the government. In many cases, they reflect promises made by the ruling party to the people during the elections.

Presentation of the budget in the legislature is the constitutional duty of the elected government. It is an exercise of great sanctity.

Although the Constitution formally entrusts the president or the governor with budget presentation in the legislature, it is presented almost always by the finance minister.

Also read: AAP Claims Absence of Centre’s Approval Has Stalled Delhi Budget Presentation ‘For the First Time’

Under India’s constitutional system, the president and the governor are the only constitutional heads who do not enjoy any executive power. The real executive power rests with the elected government. So the president and the governor have to act only on the advice of the council of ministers.

Budget-making is done by the executive without the involvement of the president or the governor, who do not have the constitutional power to review the content or reject any proposal of the budget. Thus, the formal approval of the constitutional head is not a constitutional necessity. They merely append their signature to the budget proposals.

The reason is that the budgetary exercise is the prerogative of the elected government, which alone is responsible for it. Neither the president nor the governor is in any way personally responsible for the budget. It is the elected government which has to face the people, not the constitutional heads. Therefore, such a government alone has the power to decide the scheme of taxation or expenditure. The constitutional scheme in this regard is clear and any other procedure which confers power on constitutional heads to exercise any control over budget-making is in conflict with the scheme.

The delay in the presentation of the budget in the Delhi assembly due to the reservations of the constitutional head about some allocations, or alleged bureaucratic machinations at different levels, baffles students of the constitution. The constitution invests great importance in the legislature’s power and privilege to achieve the budget for consideration.

Also read: Rs 78,800 Crore Delhi Budget Finally Presented After a Day’s Delay

The date of the presentation of the budget is decided much in advance with the involvement of the constitutional head and is duly notified to the members of the legislature. Postponement of the presentation thereafter is unheard of.

A few points are important in this context. The government of Delhi has been given all the powers of a state except police, public order and land under Article 239 AA (3) of the constitution, although Delhi remains a Union Territory. Further, the government of the National Capital Territory Act, 1991 framed as a supplemental to Article 239 AA does not provide that the content of the budget needs the approval of the Lieutenant Governor and the Ministry of Home Affairs and finally, the President of India.

So what will happen if any of these authorities disapproves of crucial proposals in the budget prepared in accordance with the policies of the elected government? They can supplant the elected government’s budget. Forced to present someone else’s budget, the elected government will be reduced to being a supplicant. Article 239 AA does not certainly put a government of the capital in such an unenviable situation.

Section 27 of the GNCTD Act, which requires previous presidential sanction for the presentation of the budget, has been misinterpreted all along to mean that the president can sanction the content of the budget. But this provision simply requires the sanction of the president for laying the budget before the Assembly. Otherwise, it would mean that Delhi’s finance minister will not present a budget, and in effect, it would be framed by the Ministry of Home Affairs, which is a constitutional absurdity.

P.D.T. Achary is former Secretary General of the Lok Sabha.

This piece was first published on The India Cable – a premium newsletter from The Wire & Galileo Ideas – and has been republished here. To subscribe to The India Cable, click here.