Difference Between Ordinary Bill and Money Bill

Last Updated : 31 Aug, 2022

What is Bill?

A bill is said to be a draft of legislation that can be introduced in either house of the Parliament and is entitled to the President’s assent only when it is passed by both houses. It does not become a law until it is approved by the executive as per the constitution. There are five types of Bills introduced in the Indian Parliament:

Ordinary Bill
Money Bill
Financial Bill
Constitutional Amendment Bill
Ordinance Replacement Bill

This article takes an in-depth look at the features of an “Ordinary Bill” and a “Money Bill” and the options before the Parliament Houses and the options before the President as well as the Governor in case of the state legislature when the bill comes on their table.

1. Ordinary Bill:

We can define an Ordinary Bill in this like way as which a draft containing matters other than financial subjects under the Money Bill, provisions of the Constitutional Amendment, and provisions concerning the ordinance replacement bill. Articles 107 and 108 of the Constitution of India deal with ordinary bills which deal with the rules and regulations rather than financial matters.

Characteristics of the Ordinary Bill:

This type of bill can be introduced in any particular House of Parliament.
An ordinary bill may be introduced by a minister or a private member.
There is no need for any prior permission from the president of India to introduce this type of bill in the parliament.
The Upper House of the Parliament of India has the power to reject or amend or discard an ordinary bill and we must note that an ordinary bill can be detained by the upper house only for six months.
To pass an Ordinary Bill in either house, a simple majority is required to pass the bill in that particular house.
There is a chance of Joint sitting can be possible in the case of an Ordinary Bill. This is because the lower house and the upper house have equal powers in respect of ordinary bills.
After the approval of both houses, the bill is sent for the President’s assent, where the President of India has the power to approve or reject or send back the ordinary bill to the Parliament to review the Bill.

Money Bill:

A money bill is defined in Article 110 of the Constitution of India in terms of tax proposals, new taxes, and changes in existing tax rates. It also includes government expenditure, revenue, and borrowing. Under Article 110 the following matters constitute which are :

an imposition, abolition, alternation, and reduction of tax.
Borrowing or guaranteeing money-related provisions regulated by the Union Government.
Provisions related to the custodian of the consolidated fund of India or the public account of India.
Any regulation concerning payment or withdrawal out of the Consolidated Fund of India or the Contingency Fund of India also comes under this bill.
Any new or existing provisions relating to the audit of Union or State accounts will come under the Money Bill.
Any other matters “incidental” to the above items also falls under the money bill. Here we have to note that Article 110 does not contain any precise definition of “incidental”, due to this loophole governments are misusing this clause.

Article 117 (1) and Article 117 (3) of the Constitution of India define how a Money Bill differs from a Finance Bill. The Speaker of the Lok Sabha certifies whether a particular draft bill falls under the category of money bill or not and his decision is absolute i.e. it cannot be questioned in any court.

Characteristics of the Money Bill:

A money bill should be introduced only in the Lok Sabha.
Only the Minister has the authority to introduce this Bill in the House and no private member has the authority to introduce it.
A Money Bill requires the prior approval of the President of India to introduce this type of bill in the Parliament. Here we must note that the President’s recommendation is on behalf of the Council of Ministers.
The Upper House of the parliament does not have any authority to reject or amend the bill but it can suggest amendments to the Lower House – Lok Sabha.
The Upper House can keep a money bill in the House for a maximum period of 14 days.
There is no possibility of joint sitting in the case of the Money Bill because the Upper House has only limited powers in respect of the Money Bill, Such that it’s not possible to disagree with the Money Bill.
To pass a money bill in either house, a simple majority is required to pass the bill in that particular house.
After the approval of both Houses, the bill is sent for the President’s assent, where the President of India has the power to approve or reject a particular bill. There is no power to send a money bill back to Parliament for reconsideration of the bill.

How Ordinary Bill and Money Bill are passed in Parliament:

Any bill in the form of a statute draft has a different procedure for the passage of that particular bill in parliament depending on its type. A draft bill must pass 3 readings in Parliament to become law. Those are

First Reading,
Second Reading, and
Third Reading

First Reading:

For an ordinary bill, the legislative process begins with the introduction of a bill in the House by any minister or private member, but in the case of a money bill, The Minister should introduce it in the Lok Sabha only with the prior approval of the President. To introduce any bill in Parliament the member-in-charge has to ask for leave to introduce the bill, when the leave is granted by the house means that the bill is introduced.

The member-in-charge introduces the bill by reading its title and objects, this step is known as the First Reading of the Bill. There will be no debate on the bill at this stage. After the completion of the introduction of the Ordinary Bill or Money Bill, it has been published in the Official Gazette, and with this step, the First Reading of the Bill process is completed. After the introduction of a Bill, the Presiding Officer may examine the Bill before the concerned Standing Committee and make a report on it. The committee may also seek expert opinion (or) general public opinion.

Second Reading:

This is a crucial stage for any draft bill to reach its final form for President’s assent. This particular phase consists of 2 sub-stages.

First Stage:

Mainly the first phase consisted of a general discussion of the entire bill but left out an in-depth detailed discussion of its provisions. When the brief debate on the bill ends, the Houses have four options for immediate action :

The House may take straightway into consideration.
The House may be referred the Bill to the Select Committee.
A House may be referred the bill to the Joint committee of both houses.
The house can broadcast the bill to gather feedback from the General Public.

If the Bill is recommended to a Select Committee or a Joint Committee, the Committee will scrutinize the Bill clause by clause and the Committee may also take evidence from associations, Public bodies, or professionals. After examining the Bill in this way, the Committee submits a report to the House with or without amendments. If the Bill is circulated to gather public opinion, such opinions shall be sought by the union government from the Government of the States and Union Territories.

Second Stage:

When the House receives a report of a Bill from a Select Committee or a Joint Committee, the House begins a clause-by-clause reading of the Bill in depth. The discussion takes place on each clause for consideration in the Bill and is voted upon separately, even other members in the house also can suggest amendments in this stage, and it becomes part of the Bill if a majority of members accepted by voting, And with this step, the second reading is deemed to be over and the process is the same for ordinary and money bills.

Third Reading:

At this phase, the member-in-charge has limited arguments in the way of support or rejection of the bill, not in detail and no amendments are allowed, but formal and verbal consequential amendments are allowed. To pass an Ordinary Bill or Money Bill, a simple majority of members are present and voting is necessary. But in the case of constitutional amendments, a special majority (2/3rd) is required from the present and voting, and With this step, the third reading and the end of the billing process are completed in that particular house.

Bill in the Second House:

When a bill is passed by one house, it is sent to the other house for concurrence, all 3 readings except the introduction stage are also held in this house. There are the following alternatives in front of the second house concerning ordinary bills and money bills:

The second house may pass the Bill without amendments.
The second house may return the bill to the first house with certain amendments. Here the Bill type is Ordinary Bill the amendments of the second house have to be considered by the first house but in the case of the Money Bill First House – Lok Sabha may or may not consider the second house amendments.
The Second House can reject a bill or keep it pending concerning an ordinary bill, but in the case of a Money Bill Second House – the Rajya Sabha cannot amend or reject it.
If the action is not taken by the second house for 6 months period it leads to deadlock and both House’s Joint sitting is summoned by the President in the case of an ordinary bill.
If no action is taken by the Second House – Rajya Sabha for 14 days in respect of a Money Bill, the Bill shall be deemed to have been passed on the expiry of the 14th day by the Both Houses of Parliament.

The procedure of a Bill before the President :

When An Ordinary Bill or a Money Bill passed by the Parliament can become law only after the assent is received by the President. When a particular bill is placed before the President’s table for his assent, he has four alternatives under Article 111 of the Constitution of India.

He may assent to the bill.
He may reject the bill, Which means the bill expires and does not become law. Here this power is called the Absolute Veto power of the President. Generally, this veto is exercised in respect of private members’ bills and respect to government bills when the previous cabinet resigns and the new cabinet advises the President to not approve the previous government bill.
He may send the bill back to Parliament for reconsideration if it is not a money bill. When the President exercises this power, it is called the President’s Suspensive Veto Power. Here we should note, that a particular bill is re-passed by the Parliament with or without amendments and again submitted for the assent of the President, at that time he has to give his assent. This means that the suspense veto is overridden by re-passing the bill with the same simple majority, but on the other hand, the special majority required in the USA.
He neither gives his assent nor rejects nor sends back the bill to parliament, but simply keeps the bill pending for an indefinite period. When the President exercises this power, it is called the President’s Pocket Veto Power. In the USA, on the other hand, the president must return the bill for reconsideration within 10 days. So it ensures that the pocket veto of the President of India is bigger than that of the President of the USA.

The procedure of a Bill before the Governor:

When an Ordinary Bill or Money Bill is passed by the state legislative and placed the bill before the governor’s table for his assent, he has Four alternatives under article 200 of the constitution of India.

He may give his assent to the Bill,
He may withhold his assent to the bill, This exercise is called the Absolute Veto of the Governor.
He may return the bill if it is not a money bill for reconsideration to the state legislature. This exercise is called the Suspensive Veto of the Governor. Here we should note, that a particular bill is re-passed by the state legislature with or without amendments and again submitted for the assent of the Governor, at that time he has to give his assent.
He may reserve the bill for consideration of the President.

The Governor generally reserves ordinary or money bills for consideration by the President in the following cases :

When that particular bill passed in the legislature and endangers the position of the state high court.
When that particular bill is passed in the legislature is against the constitution.
When that particular bill passed in the legislature is opposed to the directive principles of state policy.
When that particular bill passed the legislature is dealing with compulsory acquisition of property under article 31A of the constitution.

When the Governor is reserved the bill for consideration for the president, he has three alternatives in his hand under article 201 of the constitution of India :

He may give his assent to the bill,
He may withhold his assent to the bill,
He may suggest the governor return the bill if it is not a money bill for reconsideration to the state legislature. If the Bill is re-passed in the State Legislature with (or without) amendments and re-presented to the table of the President for his assent, It is not bound by the decision of the President and he may give his assent or withhold his assent. This means that the state legislature cannot override the President’s veto power.
The President has unlimited time to make up his decision on a bill reserved for his assent by the Governor, as the Constitution does not describe any time limit in this regard. Therefore, the President can use his Pocket Veto concerning the state legislature as well.

Difference Between Ordinary Bill and Money Bill

What is Bill?

1. Ordinary Bill:

Characteristics of the Ordinary Bill:

Money Bill:

Characteristics of the Money Bill:

How Ordinary Bill and Money Bill are passed in Parliament:

First Reading:

Second Reading:

Third Reading:

Bill in the Second House:

The procedure of a Bill before the President :

The procedure of a Bill before the Governor:

Related Frequently Asked Questions and Answers:

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Difference Between Ordinary Bill and Money Bill

What is Bill?

1. Ordinary Bill:

Characteristics of the Ordinary Bill:

Money Bill:

Characteristics of the Money Bill:

How Ordinary Bill and Money Bill are passed in Parliament:

First Reading:

Second Reading:

Third Reading:

Bill in the Second House:

The procedure of a Bill before the President :

The procedure of a Bill before the Governor:

Related Frequently Asked Questions and Answers:

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