The Transgender Persons (Protection of Rights) Bill, 2016, seeks to define a transgender person and prohibits discrimination against them.
It also confers the right upon transgender persons to be recognised as such and also grants them right to "self-perceived" gender identity.
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Speaker Sumitra Mahajan ruled that while the two bills may have similar provisions the one introduced by the government is different.
The bill also provides for a grievance redress mechanism in each establishment to ensure the rights of transgenders are protected and they are insulated from any sort of harassment or discrimination.
The measure provides for a jail term from at least six months to a maximum of two years with a fine for those found guilty of of using transgenders for bonded labour or begging.
Also, those who deny them any basic right or force them out of their homes or villages will be handed down similar punishment.
According to the 2011 Census, India has 6 lakh people belonging to the transgender community.
The community is among the most marginalised communities in the country because they don't fit into the categories of gender of 'men' or 'women'.
They face problems ranging from social exclusion and discrimination to lack of education and medical facilities, and unemployment.
The private member's bill moved by Rajya Sabha MP Tiruchi Siva was passed by the Upper House on April 24, 2015.
This was for the first time in 45 years that a private member's Bill was passed by the House.
The government had then assured the House it would bring its own bill in Lok Sabha after wider consultations.
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