What is Article 267 of Indian Constitution – Defination & Meaning

Article 267: Contingency Fund (1) Parliament may by law establish a Contingency Fund in the nature of an imprest to be entitled “the Contingency Fund of
📅 Part XII – Finance, Property, Contracts and Suits
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267

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Part XII – Finance, Property, Contracts and Suits

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Bare Acts Text

Article 267: Contingency Fund

  • (1) Parliament may by law establish a Contingency Fund in the nature of an imprest to be entitled “the Contingency Fund of India” into which shall be paid from time to time such sums as may be determined by such law, and the said Fund shall be placed at the disposal of the President to enable advances to be made by him out of such Fund for the purposes of meeting unforeseen expenditure pending authorisation of such expenditure by Parliament by law under article 115 or article 116.
  • (2) The Legislature of a State may by law establish a Contingency Fund in the nature of an imprest to be entitled “the Contingency Fund of the State” into which shall be paid from time to time such sums as may be determined by such law, and the said Fund shall be placed at the disposal of the Governor of the State to enable advances to be made by him out of such Fund for the purposes of meeting unforeseen expenditure pending authorisation of such expenditure by the Legislature of the State by law under article 205 or article 206.
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Full Definition & Explanation

Article 267 of the Indian Constitution allows the Parliament to create a Contingency Fund. This fund is similar to an imprest, which means it is a small amount set aside for emergencies. The money in this fund is used for unforeseen expenses that arise suddenly and require immediate attention. The President has the authority to access this fund to make advances for these expenses before Parliament formally approves the spending through laws under Articles 115 or 116. At the state level, Article 267 also allows state legislatures to establish their own Contingency Funds. Just like the national fund, this state fund is accessible to the Governor. It enables the Governor to make quick financial decisions for unexpected costs until the state legislature can authorize these expenses through Articles 205 or 206. This ensures that both the central and state governments can respond rapidly to emergencies or urgent financial needs without waiting for lengthy approval processes. The Contingency Fund plays a practical role in governance by ensuring that governments can act swiftly in emergencies. For example, if a natural disaster strikes, immediate funds may be necessary for rescue and relief operations. Instead of going through a lengthy legislative process, the government can draw from the fund to address urgent needs. This flexibility helps maintain effective governance and public safety, showing how the Constitution empowers leaders to act decisively in times of crisis.

Historical Context

Article 267 was included in the original Constitution adopted in 1950 as part of the financial provisions. During the Constituent Assembly debates, members recognized the need for a mechanism that allows the government to respond quickly to unforeseen circumstances. The fund reflects a balance between providing quick access to money and maintaining control over public finances. Although specific amendments to this article have not occurred, related articles have evolved to better structure financial governance. Supreme Court cases have highlighted the importance of such funds in ensuring effective governance during emergencies, reinforcing Article 267’s relevance.

Key Features

– The Parliament can establish a national Contingency Fund for emergencies.
– The President can access this fund for unforeseen expenditures.
– State legislatures can create their own Contingency Funds.
– The Governor of a state can make advances from the state fund.
– Funds are used pending legislative approval for urgent needs.

Importance & Impact

– It allows governments to respond quickly to unexpected financial situations.
– The fund aids in managing emergencies without delays from legislative processes.
– Having immediate access to funds supports governance during critical moments.
– It ensures that necessary actions can be taken without waiting for approvals.
– This financial mechanism encourages transparency and accountability in public expenditure.

Sample UPSC Question

Consider the following statements regarding Article 267 of the Indian Constitution: 1) It allows the Parliament to create a fund for emergencies. 2) The President cannot access the fund without legislative approval. 3) State governors have similar powers to access state funds. 4) The fund may be used only after prior approval from the legislature. Which of the above statements is/are correct? A) 1 and 3 only B) 2 and 4 only C) 1, 2, and 4 D) 1 and 2 only.

Answer

The correct answer is A. Article 267 allows the Parliament to create a Contingency Fund for emergencies and permits state governors to access similar funds. Options B, C, and D are incorrect because the President can access the fund without prior legislative approval, which is a key feature of this article.

Key Takeaways

✓ Article 267 allows for quick financial actions during emergencies.
✓ Both Parliament and state legislatures can create contingency funds.
✓ The President and governors can access these funds.
✓ Funds are utilized before legislative approval for urgent needs.
✓ This financial mechanism promotes accountability in public spending.

FAQs

Article 267 of the Indian Constitution allows the Parliament to create a Contingency Fund. This fund is similar to an imprest, which means it is a small amount set aside for emergencies. The money in this fund is used for unforeseen expenses that arise suddenly and require immediate attention. The President has the authority to access this fund to make advances for these expenses before Parliament formally approves the spending through laws under Articles 115 or 116.

It enables the Governor to make quick financial decisions for unexpected costs until the state legislature can authorize these expenses through Articles 205 or 206. This ensures that both the central and state governments can respond rapidly to emergencies or urgent financial needs without waiting for lengthy approval processes. The Contingency Fund plays a practical role in governance by ensuring that governments can act swiftly in emergencies.

For example, if a natural disaster strikes, immediate funds may be necessary for rescue and relief operations. Instead of going through a lengthy legislative process, the government can draw from the fund to address urgent needs. This flexibility helps maintain effective governance and public safety, showing how the Constitution empowers leaders to act decisively in times of crisis.

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Pramod Pal Founder and Editor-in-Chief

Pramod is the Founder and Editor-in-Chief of StudyHub. He holds a Master's degree and is currently pursuing a Ph.D. in Geology, alongside more than 7+ years spent building and verifying competitive exam content for Indian aspirants. He leads StudyHub's editorial process across Indian Polity, the Constitution, Indian Economy, History, Geography, Science, and the platform's other subject areas — checking every article against primary sources (bare act text and Gazette notifications for constitutional topics, government and Economic Survey data for economy content, standard reference material elsewhere) and flagging it for re-verification whenever a relevant amendment, policy, or data update makes an earlier version outdated.
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