UPSC Prelims 2011 Q37: Indian Polity – Public Finance & Finance Commission
All revenues received by the Union Government by way of taxes and other receipts for the
conduct of Government business are credited to the
- (a) Contingency Fund of India
- (b) Public Account
- (c) Consolidated Fund of India
- (d) Deposits and Advances Fund
Answer: (c) Consolidated Fund of India
Explanation
Where Union tax revenues are credited
All government receipts flow into one of a few constitutionally defined funds; this question is about the main revenue-receiving fund.
| Option | Verdict | Reason |
|---|---|---|
| (a) Contingency Fund of India | Incorrect | This is a small emergency reserve fund (Article 267), not where regular revenues land |
| (b) Public Account | Incorrect | The Public Account holds money like provident funds, deposits, where the government acts as a banker, not its own tax revenue |
| (c) Consolidated Fund of India | Correct | Under Article 266, all revenues — tax and non-tax — received by the Union Government are credited to the Consolidated Fund of India |
| (d) Deposits and Advances Fund | Incorrect | This is not a recognized constitutional fund by this name; it is a distractor |
India's government funds:
| Fund | Holds |
|---|---|
| Consolidated Fund of India | All tax/non-tax revenue for government business |
| Contingency Fund | Emergency unforeseen expenditure |
| Public Account | Flow-through money (PF, deposits) where govt is a banker |
Answer: (c) Consolidated Fund of India.
Why each option is right or wrong
- (a) Incorrect. The Contingency Fund is a separate, small emergency reserve — not the main revenue repository.
- (b) Incorrect. The Public Account holds money the government merely banks (e.g., provident funds), not its own tax revenue.
- (c) CORRECT. Article 266 directs all tax and non-tax Union revenue into the Consolidated Fund of India.
- (d) Incorrect. This is not a real constitutional fund name; it is a made-up distractor.
Key point
All Union Government revenues (tax + non-tax) are credited to the CONSOLIDATED FUND OF INDIA (Article 266), distinct from the Contingency Fund and Public Account.
Remember
All Union Government tax/non-tax revenue goes to the Consolidated Fund of India (Article 266).
Common mistakes
- Confusing the Consolidated Fund (government's own revenue) with the Public Account (money held as banker).
- Mistaking the small Contingency Fund for the main revenue repository.
- Falling for an invented fund name that sounds plausible.
Exam tip
Consolidated Fund = own revenue. Public Account = banker money. Contingency Fund = emergency reserve. Keep the three apart.
Sources
- Constitution of India — Article 266 (Consolidated Funds and Public Accounts of India and of the States)
- M. Laxmikanth — Indian Polity (Comptroller and Auditor General of India)