Q. With reference to the Union Government, consider the following statements : - The Department of Revenue is responsible for the preparation of Union Budget that is presented to the Parliament.
- No amount can be withdrawn from the Consolidated Fund of India without the authorization from the Parliament of India.
- All the disbursements made from Public Account also need the authorization from the Parliament of India.
Which of the statements given above is/are correct? (UPSC Prelims 2015)
Answer:
2 only
Notes: The correct answer is
[C] 2 only. This question tests your understanding of the specific departments within the Ministry of Finance and the constitutional mechanisms governing the three types of Government Funds.Analysis of the Statements:
- Preparation of the Union Budget (Statement 1 – Incorrect): Within the Ministry of Finance, it is the Department of Economic Affairs (DEA), specifically its Budget Division, that is responsible for preparing the Union Budget. The Department of Revenue focuses on the administration of direct and indirect taxes and the collection of revenue.
- Withdrawal from the Consolidated Fund (Statement 2 – Correct): According to Article 266(1) of the Constitution, the Consolidated Fund of India contains all revenues received, loans raised, and money received in repayment of loans by the Government. Article 114 mandates that no money can be withdrawn from this fund except under an Appropriation Act passed by the Parliament. This is the primary mechanism of parliamentary control over the executive’s "purse."
- Disbursements from the Public Account (Statement 3 – Incorrect): The Public Account of India (Article 266(2)) consists of money held by the government as a banker or trustee, such as Provident Funds, Small Savings, and Judicial Deposits. Since this money does not belong to the government, payments from the Public Account do not require parliamentary authorization. They are operated by executive action.
Comparison of the Three Government Funds:
| Feature | Consolidated Fund (Art. 266) | Public Account (Art. 266) | Contingency Fund (Art. 267) |
| Source | Taxes, Loans, Interest | PF, Small Savings, Deposits | Fixed corpus (₹30,000 crore) |
| Withdrawal | Parliamentary Law | Executive Action | Presidential Advance |
| Purpose | General Government spending | Repaying held deposits | Unforeseen/Urgent needs |