Article 112 of CoI : Article 112: Annual financial statement.

Explanation using Example

Example 1:

Scenario: Presentation of the Annual Budget

Description: Every year, the President of India ensures that a detailed financial statement, known as the annual financial statement or the Union Budget, is presented before both Houses of Parliament. This statement includes the estimated receipts (income) and expenditure (expenses) of the Government of India for the upcoming financial year.

Example: In February, the Finance Minister, on behalf of the President, presents the Union Budget for the financial year 2023-2024. The budget outlines the government's plans for revenue collection through taxes and other means, and how it intends to spend this money on various sectors such as healthcare, education, defense, and infrastructure.

Example 2:

Scenario: Distinguishing Expenditure in the Budget

Description: The annual financial statement must clearly differentiate between two types of expenditures: those charged upon the Consolidated Fund of India and other expenditures. It must also distinguish between revenue expenditure (day-to-day expenses) and capital expenditure (long-term investments).

Example: In the Union Budget for 2023-2024, the Finance Minister specifies that ₹50,000 crore is required for the salaries and allowances of the President, Vice President, and judges of the Supreme Court and High Courts. This amount is charged upon the Consolidated Fund of India and is non-negotiable. Additionally, ₹1,00,000 crore is allocated for building new highways and infrastructure projects, which is categorized as capital expenditure.

Example 3:

Scenario: Expenditure Charged on the Consolidated Fund of India

Description: Certain expenditures are automatically charged on the Consolidated Fund of India and do not require annual approval by Parliament. These include the salaries and allowances of high-ranking officials, debt charges, and any sums required to satisfy court judgments.

Example: During the financial year 2023-2024, the government needs to pay ₹10,000 crore in interest on loans it has taken. This amount is automatically charged on the Consolidated Fund of India and is included in the annual financial statement without needing separate approval from Parliament. Similarly, ₹5,000 crore is allocated for the salaries and pensions of Supreme Court judges, which is also charged on the Consolidated Fund of India.

Example 4:

Scenario: Satisfying Court Judgments

Description: If the Government of India is required to pay any amount due to a court judgment, decree, or arbitral award, this expenditure is charged on the Consolidated Fund of India.

Example: In a landmark judgment, the Supreme Court orders the Government of India to pay ₹2,000 crore as compensation to a group of citizens affected by a government project. This amount is included in the annual financial statement and is charged on the Consolidated Fund of India, ensuring that the payment is made without delay.

Example 5:

Scenario: Parliamentary Approval of the Budget

Description: While certain expenditures are charged on the Consolidated Fund of India and do not require annual approval, other expenditures proposed in the budget must be approved by Parliament.

Example: The Union Budget for 2023-2024 proposes ₹20,000 crore for new educational initiatives. This amount is not automatically charged on the Consolidated Fund of India and requires approval from both Houses of Parliament. Members of Parliament debate and vote on this proposed expenditure before it is finalized and included in the budget.