Context: Recently, the Centre has sought Parliament approval for a gross additional expenditure of Rs 2.35 lakh crore, including Rs 20,000 crores for recapitalisation of public sector banks for 2020-21.

• The Finance Minister tabled the first batch of Supplementary Demands for Grants for this financial year in the Lok Sabha.

Supplementary Grant

• The supplementary demand for grants is needed for government expenditure over and above the amount for which Parliamentary approval was already obtained during the Budget session.
• It is granted when the amount authorised by the Parliament through the appropriation act for a particular service for the current financial year is found to be insufficient for that year.

Additional Grant

• It is granted when a need has arisen during the current financial year for additional expenditure upon some new service not contemplated in the budget for that year.

Excess Grant

• It is granted when money has been spent during a financial year in excess of the amount granted for that service in the budget for that year.
• It is voted by the Lok Sabha after the financial year.
• Before the demands for excess grants are submitted to the Lok Sabha for voting, they must be approved by the Public Accounts Committee of Parliament.

Vote of Credit

• It is granted for meeting an unexpected demand upon the resources of India.
• The demand cannot be stated with the details ordinarily given in a budget.
• Hence, it is like a blank cheque given to the Executive by the Lok Sabha.

Exceptional Grant

• It is granted for a special purpose and forms no part of the current service of any financial year.

Token Grant

• It is granted when funds to meet the proposed expenditure on a new service can be made available by reappropriation.
• A demand for the grant of a token sum (of Re 1) is submitted to the vote of the Lok Sabha and if assented, funds are made available.
• Reappropriation involves transfer of funds from one head to another. It does not involve any additional expenditure.

Additional Information

Constitutional Provision

• Supplementary, additional or excess grants and Votes on account, votes of credit and exceptional grants are defined in the Constitution of India 1949.

Provisions under these Articles are:

• Article 115: Supplementary, additional or excess grants.
• Article 116: Votes on account, votes of credit and exceptional grants.

Note: Supplementary, additional, excess and exceptional grants and vote of credit are regulated by the same procedure which is applicable in the case of a regular budget.