R. K. Shanmukhan Chetty was a Constituent Assembly member from the Madras constituency. He was a prominent economist and went on to become India’s first Finance Minister.

After India became independent in 1947, the Congress party, which commanded a majority in the legislative assembly after the 1946 elections, was to form the interim government. Gandhi insisted that the Cabinet should consist of competent people irrespective of party affiliation ('freedom comes to India, not to the Congress' ). Three individuals who were not members of the party were appointed to the cabinet – Chetty was one of them.

Chetty served as independent India’s first Finance Minister from 1947 to 1949 and is most remembered for presenting India’s first budget on 26th November 1947.

Chetty gave his budget speech while India was being partitioned; he, along with others, viewed the budget as critical in ensuring the economic stability of the country. His speech focused on some key areas that included: improving the standard of living of Indians, cooperative fiscal and economic policy, increasing production of food grains, economic policies to deal with the refugee crisis and allocations towards defence.

Chetty concluded his speech by emphasizing that the cooperation of entire community was indispensable to effectively implement economic policies. He noted that rule of law is a precondition to establishing democracy in India and can be achieved through ‘political training’.

Chetty held the office of Finance Minister for a short period of time; he was asked to resign from the cabinet and the government: it was alleged that he did not investigate certain mill owners who were suspected of not paying income tax. There seem to be two accounts of this controversy: the first argues that Chetty decided not to go after the mill owners by his own accord, the second suggests that Patel influenced Chetty. Eventually, Nehru asked Chetty to resign and appointed John Matthai as the next Finance Minister.

Shanmukhan Chetty was the first Minister in the history of independent India to have been asked to resign.

Read more about Shanmukhan Chetty here.