Consolidated Fund of India

What is Consolidated Fund of India?

The Consolidated Fund on India, as defined in Article 266(1) of the Indian Constitution. It is a repository for all revenue received by the Government of India. It's a central account where all tax collections, fees, and other government receipts are pooled together. This fund is used to finance all government expenditures except for those that are met through the Contingency Fund or the Public Account.

 

What are the sources of revenue for the Consolidated Fund of India?

The Consolidated Fund of India serves as the repository for all government revenue, including:

•  Revenue from direct taxes like income tax and corporate tax.

•  Revenue from indirect taxes, like the Goods and Services Tax (GST).

•  Dividends and profits obtained from Public Sector Undertakings (PSUs).

•  Earnings are derived from the government's general services.

•  Receipts from disinvestment, debt repayments, and loan recoveries.

Note: Any withdrawal from the Consolidated Fund of India necessitates explicit approval. Of the Parliament, ensuring a rigid process that upholds transparency and accountability in the allocation of the nation's financial resources.

 

What is Charged Expenditure on Consolidated Fund of India?

• The disbursements designated as Charged Expenditures, sourced from the Consolidated Fund, fall under the category of non-votable charges.

• No voting procedure is involved in the withdrawal process of these expenditures from the Consolidated Fund of India.

• It is imperative to acknowledge that these charges are obligatory and must be honored irrespective of the passage or non-passage of the Budget.

• This category of expenses encompasses the salaries and allowances of several high-ranking officials and dignitaries, including:

  • The President

  • The Speaker of the Lok Sabha

  • The Deputy Speaker of the Lok Sabha

  • The Chairman and Deputy Chairman of the Rajya Sabha

  • Supreme Court judges, including their salaries and allowances

  • Pensions allocated to Supreme Court and High Court judges.

 

How is the Consolidated Fund of India Utilized?

The Consolidated Fund of India is the primary account for all government revenues and expenditures. Here’s how it is utilized:

 

• Revenue collection: All the revenue (direct and indirect taxes, fees, and loans raised) that a government generates is credited to this fund.

 

• Government expenditures: All expenditures made by the government, such as salaries, pensions, infrastructure projects, defense, and debt servicing, are taken from consolidated funds.

 

• Parliamentary approval: Expenditures from the Consolidated Fund require parliamentary approval through Appropriation Bills, which specify the nature and amounts of expenses allowed for withdrawal.

 

• Audit and oversight: The Comptroller and Auditor General of India audits the fund and reports to the relevant legislatures on its management.