In India, which one of the following is responsible for maintaining price stability by controlling inflation?

The correct option is Reserve Bank of India.

Step-by-step Explanation:

1. Definition of Price Stability and Inflation:
Price stability refers to a condition where the general price level in an economy does not change significantly over time, meaning inflation (the rate at which the general level of prices for goods and services rises) is kept under control.

2. The Mandate of the Reserve Bank of India (RBI):
The Reserve Bank of India (RBI) is the nation's central bank. One of its primary and statutory objectives, as mandated under the Reserve Bank of India Act, 1934, is to maintain price stability while keeping in mind the objective of growth.

3. Mechanism for Controlling Inflation:
The RBI regulates the supply of money and interest rates in the economy through its Monetary Policy. By using various tools such as the Policy Repo Rate, Reverse Repo Rate, Cash Reserve Ratio (CRR), and Statutory Liquidity Ratio (SLR), the RBI influences the cost and availability of credit. When inflation is high, the RBI typically increases policy rates to reduce money supply and aggregate demand, thereby cooling down prices and maintaining price stability.

4. Roles of Other Options:
- Department of Consumer Affairs: Mainly responsible for consumer protection, monitoring prices of essential commodities, and managing consumer cooperatives, but does not control macroeconomic inflation or monetary policy.
- Expenditure Management Commission: Set up to look into fiscal consolidation and recommend ways to reform the expenditure system, not to directly control inflation.
- Financial Stability and Development Council: A non-statutory apex body under the Ministry of Finance designed to monitor macroprudential supervision of the economy and address inter-regulatory coordination, not the direct execution of monetary policy for inflation control.