| Which of the following fall within the financial powers of the Indian Parliament? |
| 1. The Parliament can reduce or reject the demands of the Government |
| 2. The Parliament can propose any tax |
| 3. No expenditure can be incurred without the sanction of the Parliament |
| 4. No taxes can be levied without the consent of the Parliament |
A) 1, 3, 4
B) 2, 3, 4
C) 2, 3, 4
D) 1, 2, 3
Correct Answer: A
Solution :
[a] "No taxation will be levied or no expenditure is incurred without the authorization of Parliament is the cardinal principal of financial administration." The journey of budget in the Parliament starts with the Finance Minister's budget speech in which he deliberates on the general economic situation prevailing in the country and the reasons for the gap in the projected and achieved figures in the current financial year. In Parliament, the budget goes through five stages: I) presentation of budget with Finance Minister's speech, ii) general discussions; iii) voting on demand for grants; iv) passing of appropriation bills v) passing of finance bill. The powers of Parliament in respect of enactment of budget are enshrined in the Constitution under Article 112 to 117. As per these, no demand for a grant or proposal for expenditure can be made except on the recommendation of the President. Also, the Parliament cannot increase tax though it can either reduce or abolish it.
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