SIGNIFICANCE OF FINANCE MINISTERS BUDGET SPEECH

TNC SRIDHAR, ADVOCATE

The Significance of Finance Ministers Budget speech is that, it

gives the purpose and proposals of the introductions, deletions
and amendments to the existing statutes. The financial
enactments can neither be static nor be rigid. It not only has to
be dynamic and flexible but also be sensitive to interpretations
that either lead to unintended hardship or be open to mischief.
The purpose of Budget is to garner finances not only to run the
country but also maintain financial stability and improve the
scope of development by paving path for prosperity.
The Finance Minister gives the overall financial scenario, outlay
and proposals to bring in the money for any additional
liabilities. Areas where special attention are required are
identified and in order to encourage people to invest in those
area exemptions or deductions are offered from their taxable
incomes, so that the government need not take the task
collecting and investing in those areas. The movement of funds
is gross and direct to the projects rather than net and indirect.
This not only saves the time and money of the machinery but
also specific in its application.
It is therefore imperative that the Finance Ministers Budget
speech is heard and understood in the right perspective rather
than in filtered mode and in isolation
The drafting of the bill is done with utmost care and caution to
give effect to the interpretation of the intention of the
legislature. However the language has got its own handicap
and leaves the words to be interpreted in a manner to counter
the intentions.
It not possible for the courts to vet the legislation before it is
passed. In fact some of the amendments have their genesis to
the legal interpretation by the courts, which normally has a

source based on facts and circumstances unique to the

particular case.
There is no uniformity in the legal interpretation which is the
precise reason for the matter to be taken to various appellate
levels. The enactments have to be seen from both angles of
letter and spirit considering the fact and circumstances.
It would be ideal to have a team of judiciary executive and the
legislature to evolve a draft bill. Experiments have also been
made to present a draft bill and call for opinions from various
forums, bodies and public, but this system also failed to have
desired results as very often the minds would not meet at
ground level to serve the purpose of legislation. If too much
importance will be given to legality, the drafting will become so
complicated and may only become a literary piece fit only in
books that it would be very difficult for common man to
understand what the law is.
It is not out of place to mention that the apex court has taken
into account the fact that the object and purpose of the
particular provisions introduced by the finance Bill can be relied
upon while deciding the issues, as held in the case of K.P.
Varghese v. ITO (1981) 131 ITR 597 (SC), Kerala State Industrial
Development Corporation Ltd. v. CIT, (2003) 259 ITR 51
(SC) and Sole Trustee, Loka Shikshana Trust v. CIT (1975) 101
ITR 234 (SC)
It has also been held by the apex court in the case of Deputy
CTO v. Sha Sukraj Peerajee [ AIR 1968 SC 67, 70] that where
particular date of coming into effect of a provision in the act not
been expressed, in view of the specific provisions of sections
5(1) of the Madras General Clauses Act , 1891, the Madras
General Sales Tax (Third Amendment) Act, 1956, the same
comes into operation on the day on which assent thereto of the
Governor was first published in the Official Gazette and not on
the day it received the assent of the Governor.
In other words the significance of Finance ministers speech is
one of the sources to determine the intention of the legislature
The Finance Ministers with legal background present the budget
with these impediments. There is a limit to imagine the
contingencies but the intentions are paramount. Let us cross
the bridge when it comes.