Assistant Provident Fund Commissioner (APFC) 2016 recruitment test, advertisement 170. Transcribed from the Commission's own booklet (series A, B-CRHE-O-PAPA); answer as per the official UPSC final answer key. This question is in Part B. Answer last reviewed 24 August 2026.

Statement (I) : Speaker of the Lok Sabha appoints the Chairman of the Public Accounts Committee. Statement (II) : Members of Parliament, eminent persons from industry and trade are the members of the Public Accounts Committee.

(a)Both Statement (I) and Statement (II) are individually true and Statement (II) is the correct explanation of Statement (I)
(b)Both Statement (I) and Statement (II) are individually true but Statement (II) is not the correct explanation of Statement (I)
(c)Statement (I) is true but Statement (II) is false
(d)Statement (I) is false but Statement (II) is true

Answer

Why

Correct — C, (c) Statement (I) is true but Statement (II) is false.

This is the last question of the paper and the fourth and final item of its assertion-reason block, whose Directions and four codes are printed once at the head of the column over question 117. Because one statement here is false, the item is settled entirely at the first stage — the truth of each statement — and the question of explanation never arises.

STATEMENT (I) IS TRUE. The Chairman of the Public Accounts Committee is APPOINTED BY THE SPEAKER of the Lok Sabha from among the members of the committee. It is worth being precise about the mechanism, because two different acts are involved and candidates run them together: the MEMBERS of the committee are ELECTED by the two Houses, by proportional representation through the single transferable vote, while the CHAIRMAN is APPOINTED by the Speaker from among those elected members. Election for the body, appointment for its head.

There is a well-known convention attached to this power. Until the late 1960s the chairmanship went to a member of the ruling party. Since 1967 the Speaker has by convention appointed a member of the OPPOSITION as Chairman of the Public Accounts Committee. The convention makes constitutional sense: the committee's business is to scrutinise how the executive spent the money Parliament granted it, and a chairman drawn from the opposition benches strengthens that scrutiny. The convention is not a rule of law and the appointment remains the Speaker's, which is exactly what Statement (I) says.

STATEMENT (II) IS FALSE, and the error is precise rather than vague. The Public Accounts Committee consists ONLY OF MEMBERS OF PARLIAMENT. Its strength is 22: 15 members elected by the LOK SABHA, and 7 members elected by the RAJYA SABHA, in each case by proportional representation through the single transferable vote, for a term of one year. There is no provision of any kind for eminent persons from industry and trade, or from any other walk of life, to be MEMBERS of the committee. A parliamentary committee is an instrument by which Parliament examines the executive on its own behalf, and admitting non-parliamentarians to its membership would cut across that purpose. One further restriction confirms the character of the body: a MINISTER cannot be elected to it, and a member who is subsequently appointed a minister ceases to be a member — because a minister sits on the side being scrutinised.

WHERE THE CONFUSION IN STATEMENT (II) COMES FROM, and it is worth naming because the distinction is a real one. The committee regularly CALLS WITNESSES. It summons the officers of ministries and departments, examines the heads of public undertakings, and may take evidence from experts and from representatives of trade and industry where the subject requires it. The Comptroller and Auditor General assists it throughout and is traditionally described as its friend, philosopher and guide. But every one of these is a witness or an assistant to the committee, not a MEMBER of it. Statement (II) turns people who may be heard by the committee into people who sit on it, and that is where it fails.

WHAT THE COMMITTEE ACTUALLY DOES, since the item is really testing whether the body is understood. It examines the appropriation accounts and the finance accounts of the Union Government together with the audit reports of the Comptroller and Auditor General, which are laid before Parliament. Its questions are whether the money was spent on the service for which it was granted, whether the expenditure was authorised, and whether it was incurred with due economy — and, where waste or extravagance appears, it says so. It is a post-mortem examination, conducted after the money has been spent, which is both its characteristic method and its principal limitation.

In the printed booklet the second statement prints 'Members of Parliament, eminent persons from industry and trade are the members', with a comma and no conjunction between the two groups; the text is reproduced as set. Both statement labels are in italics with a space before the colon, and this is the last item on the English page.

Why the others are wrong

(a)Both Statement (I) and Statement (II) are individually true and Statement (II) is the correct explanation of Statement (I) — This code fails twice over, which is worth working through because each failure teaches something. It fails FIRST because Statement (II) is not true: the Public Accounts Committee is composed entirely of Members of Parliament — 15 elected by the Lok Sabha and 7 by the Rajya Sabha — and no eminent person from industry or trade may be a member of it. Once a statement is false, codes (a) and (b) are both unavailable and the item is decided. It fails SECOND, and independently, on the explanatory test: even if the committee did contain outside experts, that fact would say nothing about WHO APPOINTS ITS CHAIRMAN. The composition of a body and the authority that names its head are separate questions, and no chain of reasoning runs from one to the other. Noticing that second failure is a useful discipline in itself, because on assertion-reason items a candidate who is uncertain about a fact can sometimes still eliminate a code by testing whether the proposed explanation could possibly work.
(b)Both Statement (I) and Statement (II) are individually true but Statement (II) is not the correct explanation of Statement (I) — This is the trap for a candidate who has correctly seen that the two statements have nothing to do with each other, and who therefore reaches for the code that says exactly that — without first checking whether both statements are true. They are not. Statement (II) misdescribes the membership of the Public Accounts Committee, which consists of 22 Members of Parliament and no one else: 15 elected by the Lok Sabha and 7 by the Rajya Sabha, each by proportional representation through the single transferable vote, for a term of one year, with ministers excluded. Persons from industry and trade may be summoned as WITNESSES before the committee, and often are, but a witness is not a member. The general lesson is the one the format is built to teach: the codes must be applied in order. Truth first, for each statement independently; explanation only afterwards, and only if both statements have survived. A candidate who runs to the explanatory question because it looks like the interesting one will keep choosing (b) on items whose answer is (c) or (d).
(d)Statement (I) is false but Statement (II) is true — This code inverts the item completely, marking the true statement false and the false one true. Statement (I) is correct: the Speaker of the Lok Sabha appoints the Chairman of the Public Accounts Committee from among its members, and has done so since the committee took its present form after independence, with the further convention since 1967 of appointing a member of the Opposition. The same Speaker appoints the chairmen of the other two financial committees, the Estimates Committee and the Committee on Public Undertakings, so the power is not peculiar to this body. What a candidate may be half-remembering is the separate fact that the committee's MEMBERS are elected rather than appointed, and that the Rajya Sabha elects seven of them — but electing the members and appointing the chairman are different acts by different authorities, and Statement (I) speaks only of the second. Meanwhile Statement (II), which this code accepts, is the one that is actually wrong.

Concept

THE PUBLIC ACCOUNTS COMMITTEE is the oldest and best known of Parliament's financial committees, and its purpose is to complete the circle of financial control: Parliament grants money to the executive, and the committee afterwards examines whether the money was spent as granted.

ORIGIN. It was first constituted in 1921 under the Government of India Act, 1919 — the Montagu-Chelmsford reforms — and in that early form the Finance Member of the Executive Council presided over it. After independence it became a committee of Parliament, functioning under the Rules of Procedure and Conduct of Business in the Lok Sabha.

COMPOSITION. 22 members in all — 15 elected by the Lok Sabha and 7 elected by the Rajya Sabha. Election is by PROPORTIONAL REPRESENTATION through the SINGLE TRANSFERABLE VOTE, which ensures that all significant parties, including opposition parties, are represented. The term of office is ONE YEAR, and the committee is reconstituted annually. A MINISTER cannot be elected a member; a member appointed a minister ceases to be one. Membership is confined to Members of Parliament. No outside expert, industrialist or trader may be a member.

CHAIRMAN. Appointed by the SPEAKER of the Lok Sabha from among the committee's members. Since 1967 the Speaker has by convention appointed a member of the OPPOSITION, which strengthens the committee's role as a check on the executive.

FUNCTIONS. Examination of the APPROPRIATION ACCOUNTS and the FINANCE ACCOUNTS of the Union Government, together with the audit reports of the Comptroller and Auditor General laid before Parliament. Satisfying itself that the money shown as spent was legally available for the purpose to which it was applied, that the expenditure conformed to the authority governing it, and that any re-appropriation was properly made. Going beyond formal propriety to comment on waste, extravagance and lack of economy — what is often called the test of financial prudence as well as of legality. Examining the accounts of state corporations, autonomous bodies and manufacturing projects whose accounts are audited by the Comptroller and Auditor General.

THE COMPTROLLER AND AUDITOR GENERAL is the committee's indispensable partner, traditionally described as its friend, philosopher and guide. The Comptroller and Auditor General audits and reports; the committee examines the report, summons officials to answer for it, and recommends. Neither is effective without the other.

LIMITATIONS, which are examined as often as the functions. It conducts a POST-MORTEM examination, after the money has been spent, and cannot prevent expenditure in advance. It cannot interfere in the day-to-day administration of a department. Its recommendations are advisory and not binding on the executive. It examines matters of policy only in their financial consequences, not in themselves.

THE THREE FINANCIAL COMMITTEES, worth learning as a set because papers compare them. PUBLIC ACCOUNTS COMMITTEE — 22 members, 15 from the Lok Sabha and 7 from the Rajya Sabha; chairman appointed by the Speaker, by convention from the Opposition since 1967; examines audited accounts after expenditure. ESTIMATES COMMITTEE — 30 members, ALL from the Lok Sabha, with no Rajya Sabha representation; chairman appointed by the Speaker and always from the ruling party; examines the estimates before and during expenditure and suggests economies. It is often called the continuous economy committee, and it and the Public Accounts Committee are described as twin sisters. COMMITTEE ON PUBLIC UNDERTAKINGS — 22 members, 15 from the Lok Sabha and 7 from the Rajya Sabha; examines the reports and accounts of public sector undertakings. In all three the chairman is appointed by the Speaker and no minister may be a member.

WITNESSES ARE NOT MEMBERS. Any parliamentary committee may summon officials, call for papers and take evidence from persons outside Parliament, including from industry and trade where the subject requires it. That power is what Statement (II) of this question misreads as membership.

The paper closes on a polity item, and it is a good one to close on because it tests a distinction rather than a fact — the difference between who MAY APPEAR before a parliamentary committee and who MAY SIT on it.

Polity supplies about seven questions on this APFC booklet, and the parliamentary committees are a standing favourite across central recruitment papers because they carry a dense set of numbers and conventions that are easy to set questions on and easy to confuse: how many members, from which House or Houses, elected or appointed, who chairs, from which side of the House, and for how long. This item takes two of those facts and gets one right and one wrong.

The construction rewards a candidate who applies the assertion-reason procedure properly rather than one who reads for plausibility. Statement (II) SOUNDS reasonable — a committee examining public accounts might well want commercial expertise, and committees do in fact hear from industry — so a candidate reading quickly may accept it and then spend their effort on the explanatory question, which is where codes (a) and (b) both lie. But the explanatory question never arises here, because a statement is false. Truth first, explanation second, and only if the first stage is passed.

The wider point about parliamentary committees is worth carrying: they are instruments through which PARLIAMENT examines the executive, so their membership is drawn from Parliament and from nowhere else, and a minister cannot be a member because a minister is on the side being examined. Once that principle is held, an option asserting outside membership can be rejected without looking anything up.

The statement is printed with a comma and no conjunction between 'Members of Parliament' and 'eminent persons from industry and trade', and the Hindi column prints two consecutive conjunctions in the corresponding place. Both are the booklet's own and are reproduced as set.

Key facts

The Chairman of the Public Accounts Committee is appointed by the Speaker of the Lok Sabha from among the committee's members.
Since 1967 the Speaker has by convention appointed a member of the Opposition as Chairman of the Public Accounts Committee.
The committee has 22 members: 15 elected by the Lok Sabha and 7 elected by the Rajya Sabha.
Members are elected by proportional representation through the single transferable vote, for a term of one year.
Membership is confined to Members of Parliament; no outside expert, industrialist or trader may be a member.
A minister cannot be elected to the committee, and a member appointed a minister ceases to be a member.
The committee may summon officials and take evidence from persons outside Parliament, but such persons are witnesses and not members.
It examines the appropriation accounts and finance accounts of the Union Government together with the audit reports of the Comptroller and Auditor General.
The Comptroller and Auditor General is traditionally described as the friend, philosopher and guide of the Public Accounts Committee.
The committee was first constituted in 1921 under the Government of India Act, 1919.
Its examination is a post-mortem one, conducted after expenditure, and its recommendations are advisory.
The Estimates Committee has 30 members, all from the Lok Sabha, and its chairman, also appointed by the Speaker, is always from the ruling party.
The Committee on Public Undertakings has 22 members, 15 from the Lok Sabha and 7 from the Rajya Sabha.

Study next

The three financial committees compared: strength, composition, chairman and function.Departmentally related standing committees and their role in examining demands for grants.The Comptroller and Auditor General: appointment, tenure, removal and the reports laid before Parliament.The budget process: demands for grants, appropriation and finance bills, and the stages of parliamentary approval.The Consolidated Fund of India, the Contingency Fund and the Public Account, and what is charged on each.Charged expenditure and votable expenditure, and why some items are not put to the vote.The office of the Speaker: powers, tenure, and the conventions attached to the post.Ad hoc and standing committees of Parliament, and the powers all committees share to summon persons and papers.Cut motions and the other instruments of financial control available to Parliament.

Common traps

Confusing election of members with appointment of the chairman. Members are elected by the Houses; the chairman is appointed by the Speaker.
Believing that outside experts sit on parliamentary committees. They may appear as witnesses; membership is confined to Members of Parliament.
Mixing up the Public Accounts Committee with the Estimates Committee. The Estimates Committee has 30 members, all from the Lok Sabha, and its chairman is from the ruling party.
Forgetting that a minister cannot be a member of these committees.
Treating the convention of an Opposition chairman as a rule of law. It is a convention followed since 1967, and the appointment remains the Speaker's.
Answering the explanatory question before establishing that both statements are true, which is what makes code (b) attractive on an item whose answer is (c).
Assuming the committee's recommendations bind the executive. They are advisory.

Parliamentary committees are asked on almost every central recruitment paper, and the questions turn on a small set of numbers and conventions rather than on general understanding: the strength of each committee, which House its members come from, whether they are elected or nominated, who appoints the chairman, from which side of the House the chairman comes, and the term. The efficient preparation is a single comparative table of the three financial committees plus a line on ministers being excluded from all of them. In the assertion-reason form the examiner will typically pair one correct procedural fact with one plausible-sounding misdescription, as here, so the discipline of testing each statement separately is what converts knowledge into a mark. And keep hold of the underlying principle, because it settles a whole class of statements without recall: a parliamentary committee is Parliament examining the executive, so its members are parliamentarians, outsiders appear only as witnesses, and ministers are excluded.

Related PYQs

EPFO_APFC_2023_Q112

Which of the following expenditures are charged to the Consolidated Fund of India? 1. The debt charges for which the Government of India is liable 2. The emoluments and allowances of the President and other expenditure relating to his/her office 3. The salaries, allowances and pensions payable to or in respect of Judges of the Supreme Court 4. The salaries and allowances of the Chairman and the Deputy Chairman of the Rajya Sabha, and the Speaker and the Deputy Speaker of the Lok Sabha Select the correct answer using the code given below.

(a) 1 and 2 only
(b) 1, 2, 3 and 4
(c) 2, 3 and 4 only
(d) 3 and 4 only

Answer(b) 1, 2, 3 and 4

Which expenditures are charged to the Consolidated Fund of India — the fund whose appropriation accounts the Public Accounts Committee examines, asked on a later EPFO paper.

EPFO_APFC_2016_Q57

Which of the following are the roles of the Finance Commission in India ? 1. The distribution of money collected through taxes 2. Evaluation of Centrally sponsored schemes 3. Evolve principles based on which funds are allotted among States 4. To develop Five Year Plans Select the correct answer using the codes given below :

(a) 1 and 4 only
(b) 1 and 3 only
(c) 2 and 4 only
(d) 2 and 3 only

Answer(b) 1 and 3 only

The roles of the Finance Commission in India — the paper's other public-finance institution item, and a body regularly confused with the parliamentary financial committees.

EPFO_EOAO_2020_Q97

Who among the following Speakers of Lok Sabha formally disassociated from the political party after his election as the Speaker ?

(a) G.V. Mavalankar
(b) Sardar Hukam Singh
(c) Neelam Sanjiva Reddy
(d) P.A. Sangma

Answer(c) Neelam Sanjiva Reddy

Which Speaker of the Lok Sabha formally disassociated from his political party after election — the office that appoints this committee's chairman, tested on a later EPFO paper through the conventions attached to it.

Practice

practice — not a real PYQ
Which one of the following statements about the Estimates Committee of Parliament is correct ?
- (a)It has 22 members, of whom 7 are elected by the Rajya Sabha
- (b)It has 30 members, all elected by the Lok Sabha
- (c)Its chairman is by convention a member of the Opposition
- (d)Its members include eminent economists nominated by the Speaker
Answer(b) It has 30 members, all elected by the Lok Sabha — the Estimates Committee has no Rajya Sabha representation, unlike the Public Accounts Committee and the Committee on Public Undertakings, which have 22 members each including 7 from the Rajya Sabha. Its chairman is appointed by the Speaker and is always from the ruling party, and no outsider may be a member of any parliamentary committee.
practice — not a real PYQ
The Public Accounts Committee examines the audit reports of which one of the following authorities ?
- (a)The Finance Commission
- (b)The Comptroller and Auditor General of India
- (c)The Central Vigilance Commission
- (d)The Union Public Service Commission
Answer(b) The Comptroller and Auditor General of India — the audit reports laid before Parliament are the committee's basic working material, which is why the Comptroller and Auditor General is described as its friend, philosopher and guide. The Finance Commission recommends the sharing of tax revenue between the Union and the States, and neither of the other two bodies audits government expenditure.