As per the Constitution of India, all revenues received by the Central government and the loans raised by it should be put into the Consolidated Fund of India. This does not include anything that is put into a Contingency Fund. When the government does not have enough time to vote for a full budget before the commencement of the new financial year (like the present government), a special provision is made to make sure that there is enough money at the disposal of the government to allow it to run the administration of the country.
This special provision known as the 'vote-on-account', by which the government obtains the vote of the Parliament for an amount sufficient to incur expenditure on various items for a part of the year. This sanction by the Parliament to obtain money from the Consolidated Fund of India to meet the expenditure of the government is known as Vote on Account.
A vote-on-account cannot alter direct taxes since they need to be passed through a finance bill. A common feature of Interim Budget and Vote-on-Account is that both include the previous year's financial performance of the government.
Is Vote-On-Account and Interim Budget same?
The vote-on-account- deals only with the government's expenditure, but the Interim Budget is a full set of accounts, including both expenditure and receipts.
What is a Full Budget?
The Budget is an official statement which shows the financial position of the ruling government for a definite period of time based on the estimates of expenses during the period and proposals for financing them. The full budget shows both, how the government should spend money and how it should be raised.
Why a Vote-On-Account and not an Interim Budget?
A government which has less time left in the Parliament usually go for vote-on-account, because it is regarded improper for an outgoing government to impose on its successor changes that may or may not be acceptable to the incoming government.
For how long can a Vote-On-Account be in force?
The vote-on-account is normally taken for two months only. But during election year or when it is anticipated that the main Demands and Appropriation Bill will take longer time than two months, the vote-on-account may be for a period extending two months.
Typically this period does not exceed six months, as that is the maximum gap possible between two sittings of the Parliament. Normally a vote-on-account is in operation till the full Budget is passed.
OneIndia News (With inputs from Agencies)