A grant made by Parliament to meet the cost of a new service, when funds can be met by re-appropriation from another head, is called a:

A token grant is granted when funds to meet a proposed expenditure on a new service can be made available by re-appropriation. A demand for a token sum, such as one rupee, is submitted to the Lok Sabha for vote, and if it is approved, the funds are made available by re-appropriation from other heads.

Why it is needed:

• The Constitution and parliamentary practice require that expenditure on a "new service" should have the approval of Parliament.
• If savings are available under another head, the government does not need fresh money, but it still needs Parliament's permission to use them for the new purpose.
• The token grant gives this permission.

Meaning of re-appropriation:

Re-appropriation means transferring funds from one unit of appropriation (sub-head) to another within the same grant.

Other types of grants:

• Supplementary grant: when the amount authorised for a particular service for the current year is found to be insufficient.
• Additional grant: when a need arises during the year for additional expenditure on a new service not contemplated in the Budget.
• Excess grant: when money has been spent on a service in excess of the amount granted for that year; it is voted by the Lok Sabha after the financial year, on the recommendation of the Public Accounts Committee.
• Vote of credit: a blank cheque given to the government when it is not possible to state the amount or details of a demand, for example because of an emergency.
• Vote on account: allows the government to meet expenditure for a part of the year, pending the passing of the Budget.

Constitutional provisions:

• Article 115 deals with supplementary, additional and excess grants.
• Article 116 deals with votes on account, votes of credit and exceptional grants.
• The token grant is a matter of parliamentary procedure.

Token cut:

Different from a token grant, a "token cut" is a cut motion to reduce a demand by 100 rupees to express a specific grievance.

Why not the other options?

• ✗Exceptional grants, votes of credit and excess grants are other forms of grants, as explained above.