Previous Year Question
When the Annual Union Budget is not passed by the Lok Sabha?
The Budget is modified and presented again.
The Budget is referred to the Rajya Sabha for suggestions.
The Union Finance Minister is asked to resign.
The Prime Minister submits the resignation of the Council of Ministers.
Correct Answer: D
Detailed Solution
In a parliamentary system, the defeat of the Budget or a major financial proposal of the Government in the Lok Sabha is ordinarily treated as a loss of the confidence of the House. Consequently, the Prime Minister must submit the resignation of the entire Council of Ministers to the President.
Constitutional basis
Under Article 75(3), the Council of Ministers is collectively responsible to the Lok Sabha. The Government can remain in office only while it enjoys the confidence of the Lok Sabha.
The Budget represents the Government’s principal proposals concerning revenue, expenditure, taxation and policy priorities. Its rejection demonstrates that the Government no longer possesses majority support in the House.
What does ‘passing the Budget’ mean?
Technically, the Annual Financial Statement itself is not put to vote. Parliamentary approval of the Budget involves several stages:
Presentation of the Annual Financial Statement under Article 112.
General discussion.
Examination of Demands for Grants by Department-related Standing Committees.
Voting on Demands for Grants by the Lok Sabha under Article 113.
Passage of the Appropriation Bill under Article 114.
Giving effect to taxation proposals through the Finance Bill.
Thus, failure to pass the Budget ordinarily refers to the defeat of the Demands for Grants, the Appropriation Bill or another essential financial proposal.
Role of the Rajya Sabha
The Rajya Sabha may discuss the Budget.
It cannot vote on the Demands for Grants.
If the Appropriation Bill and Finance Bill qualify as Money Bills, the Rajya Sabha may only make recommendations.
It must return a Money Bill to the Lok Sabha within 14 days.
The Lok Sabha may accept or reject its recommendations.
Therefore, the decisive authority concerning approval or rejection of the Budget rests with the Lok Sabha.
Why are the other options incorrect?
Option (a): The Government may introduce a fresh or modified financial proposal, but an explicit budgetary defeat first raises the question of its majority. It cannot automatically continue merely by presenting a modified Budget.
Option (b): Referring the Budget to the Rajya Sabha for suggestions is not the constitutional remedy for its defeat in the Lok Sabha.
Option (c): The Budget represents the collective policy of the Council of Ministers. Its defeat does not make only the Finance Minister responsible; the entire Council is accountable under collective responsibility.
After accepting the resignation, the President may ask the outgoing Council of Ministers to continue in a caretaker capacity until an alternative Government is formed.