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Q1 (IAS/2004) Economy › Government Finance & Budget › Government funds structure Answer Verified

With reference to Indian Public Finance, consider the following statements: 1.. Disbursements from Public Accounts of India are subject to the Vote of Parliament. 2. The Indian Constitution provides for the establishment of a Consolidated Fund, a Public Account and a Contingency Fund for each State. 3. Appropriations and disbursements under the Railway Budget are subject to the same form of parliamentary control as other appropriations and disbursements. Which of the statements given above are correct ?

Result
Your answer: —  Â·  Correct: B
Explanation

Statement 1 is incorrect: receipts into and disbursements out of the Public Account are not subject to a parliamentary vote; the Public Account is operated by executive action and refunds/withdrawals do not require parliamentary appropriation [1]. Statement 2 is correct: the Constitution mandates that State Governments have their own Consolidated Fund, Public Account and Contingency Fund [1]. Statement 3 is correct: expenditures requiring appropriation (including those of the Railways) are subject to parliamentary control and authorization as withdrawals from the Consolidated Fund, so appropriations and disbursements under the Railway Budget are subject to the same form of parliamentary control as other appropriations; withdrawals from the Consolidated Fund need Parliament’s authorization [2].

Sources

  1. [1] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 4: Government Budgeting > 4.3 Government Accounts > p. 151
  2. [2] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 4: Government Budgeting > 4.3 Government Accounts > p. 150
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