Third State Finance Commission
73rd Constitutional Amendment
3 – Tier System:
PART IX of the Constitution envisages a three-tier system of Panchayats, namely, (a) The village level; (b) The District Panchayat at the district level; (c) The Intermediate Panchayat which stands between the village and district Panchayats in the States where the population is above 20 lakhs.
All the seats in a Panchayat shall be filled by persons chosen by direct election from territorial constituencies in the Panchayat area. The electorate has been named Grama Sabha consisting of persons registered in the electoral rolls relating to a village comprised within the area of a Panchayat. In this way representative democracy will be introduced at the grass roots.
The Chairperson of each Panchayat shall be elected according to the law passed by a State and such State Law shall also provide for the representation of Chairpersons of Village and Intermediate Panchayats in the District Panchayat, as well as members of the Union and State Legislature in the Panchayats above the village level.
Reservation of seats for Schedule Castes and Scheduled Tribes:
Article 243D provides that seats are to be reserved for (a) Scheduled Castes, and (b) Scheduled Tribes. The reservation shall be in proportion to their population. If, for example, the Scheduled Castes constitute 30% of the population and the Scheduled Tribes 21%, then 30% and 21% seats shall be reserved for them respectively.
Out of the seats so reserved not less than 1/3rd of the seats shall be reserved for women belonging to Scheduled Castes and Scheduled Tribes, respectively.
Reservation for women:
Not less than 1/3rd of the total number of seats to be filled by direct elections in every Panchayat shall be reserved for women.
Reservation of offices of Chairpersons:
A State may by law make provision for similar reservation of the offices of Chairpersons in the Panchayats at the village and other levels.
These reservations favouring the Scheduled Castes and Scheduled Tribes shall cease to be operative when the period specified in Article 334 (at present 60 years i.e., upto 21-1-2010).
A State may by law also reserve seats or offices of Chairpersons in the Panchayat at any level in favour of backward classes of citizens.
Duration of Panchayat:
Every Panchayat shall continue for five years from the date of its first meeting. But it can be dissolved earlier in accordance with the procedure prescribed by State Law. Elections must take place before the expiry of the above period. In case it is dissolved earlier, then the elections must take place within six months of its dissolution. A Panchayat reconstituted after premature dissolution (i.e., before the expiry of the full period of five years) shall continue only for the remainder of the period. But if the remainder of the period is less than six months it shall not be necessary to hold elections.
Qualification for membership:
Article 243F provides that all persons who are qualified to be chosen to the State Legislature shall be qualified to be chosen as a member of a Panchayat. The only difference is that a person who has attained the age of 21 years will be eligible to be a member (in case of State Legislature the prescribed age is 25 years-Article 173). If a question arises as to whether a member has become subject to any disqualification, the question shall be referred to such authority as the State Legislature may provide by law.
Powers, authority and responsibilities of Panchayats:
State Legislatures have power, to confer on the Panchayats such powers and authority as may be necessary to enable them to function as institutions of self-government [Arts. 243G-243H]. They may be entrusted with the responsibility of (a) preparing plans for economic development and social justice, (b) implementation of schemes for economic development and social justice, and (c) in regard to matters listed in the Eleventh Schedule (inserted by the 73rd Amendment). The list contains 29 items, e.g., land improvement, minor irrigation, animal husbandry, fisheries, education, women and child development etc. The 11th Schedule thus distributes powers between the State Legislature and the Panchayat just as the 7th Schedule distributes powers between the Union and the State Legislature.
Powers to impose taxes and financial resources:
A State may by law authorise a Panchayat to levy, collect and appropriate taxes, duties, tolls etc. The law may lay down the procedure to be followed as well as the limits of these exactions. It can also assign to a Panchayat various taxes, duties etc. collected by the State Government. Grants-in-aids may be given to the Panchayts from the Consolidated Fund of the State.
Panchayat Finance Commissions:
Within one year from 25th April 1993, i.e., the date on which the Constitution 73rd Amendment came into force and afterwards every five years the State Government shall appoint a Finance Commission to review the financial position of the Panchayats and to make recommendations as to---
The report of the Commission, together with a memorandum of action taken on it, shall be laid before the State Legislature. These provisions are modelled on Article 280 which contains provisions regarding appointment of a Finance Commission for distribution of finances between the Union and the States.
State Election Commission:
Article 243K is designed to ensure free and fair elections to the Panchayats.
Article 243K provides for the Constitution of a State Election Commission consisting of a State Election Commissioner to be appointed by the Governor. Powers of superintendence, direction and control of elections to the Panchayats, including preparation of electoral rolls for it shall vest in the State Election Commission. To ensure the Independence of the Commissioner it is laid down that State Election Commissioner can be removed only in the same manner and on the same grounds as Judge of a High Court. The State Legislatures have the power to legislate on all matters relating to elections to Panchayats.
Bar to interference by Courts in electoral matters:
As under Article 329, courts shall have no jurisdiction to examine the validity of a law, relating to delimitation of constituencies or the allotments of seats, made under Art. 243K. An election to a Panchayat can be called in question only by an election petition which should be presented to such authority and in such manner as may be prescribed by or under any law made by the State Legislature.
74th Constitutional Amendment
Municipalities And Planning Committees
PART IXA which has come into force on 1-6-1993 gives a constitutional foundation to the local self-government units in urban areas. In fact such institutions are in existence all over the country.
Some of the provisions are similar to those contained in Part IX, e.g., Reservation of Seats, Finance Commission, Election Commission etc.
This part gives birth to two types of bodies:
Institutions of self-government, called by a general name "municipalities" are of three types:
Article 243Q makes it obligatory for every State to constitute such units. But if there is an urban area or part of it where municipal services are being provided or proposed to be provided by an industrial establishment in that area then considering also the size of the area and other factors the Governor may specify it to be an industrial township. For such an area it is not mandatory to constitute a Municipality.
Composition of Municipalities:
The members of a municipality would generally be elected by direct election. The Legislature of a State may by law provide for representation in a municipality of (i) persons having special knowledge or experience in municipal administration, (ii) Members of LOk Sabha, State Assembly, Rajya Sabha and Legislative Council, and (iii) the Chairpersons of Committees constituted under Cl. (5) of Art.243S. The Chairperson shall be elected in the manner provided by the Legislature.
For one or more wards comprised within the territorial area of a municipality having a population of three lacs or more it would be obligatory to constitute Ward Committees. The State Legislature shall make provision with respect to its composition, territorial area and the manner in which the seats in a ward committee shall be filled.
It is open for the State Legislature to constitute Committees in addition to the wards committees.
Reservations of seats for Scheduled Castes and Scheduled Tribes:
As in Part IX reservations of seats are to be made in favour of the Scheduled Castes and Scheduled Tribes in every Municipality.
Reservation for women:
Out of the total number of seats to be filled by direct elections at least 1/3rd would be reserved for women. This includes the quota for women belonging to Scheduled Castes and Tribes.
Reservation of offices of Chairpersons:
It has been left to the State legislature to prescribe by law the manner of reservation of the offices of the Chairpersons of Municipalities.
All reservations in favour of Scheduled Castes and Tribes shall come to an end with the expiry of the period specified in Art. 334.
It is permissible for a State Legislature to make provisions for reservation of seats or offices of Chairpersons in favour of backward classes.
Duration of Municipalities:
Every Municipality shall continue for five years from the date of its first meeting. But it may be dissolved earlier according to law. Article 243Q further prescribes that before dissolution a reasonable opportunity of being heard must be given to the municipality. Elections to constitute a Municipality shall be completed before the expiry of the period of five years. If the Municipality has been superseded before the expiry of its term, the elections must be completed within six months of its dissolution. A Municipality constituted after its dissolution shall continue only for the reminder of the term. But if the reminder of the period is less than six months it shall not be necessary to hold elections.
It has been provided that no amendment of the law in force shall cause dissolution of a Municipality before the expiry of the five years term.
Qualification for membership:
Article 243V lays down that all persons who are qualified to be chosen to the State legislature shall be qualified for being a member of a Municipality. There is an important difference. Persons who have attained the age of 21 years will be eligible to be a member. While the constitutional requirement is that for election to the State legislature of a State a person must have attained the age of 25years [Art. 173].
Powers, authority and responsibilities of Municipalities:
Legislatures of States have been conferred the power [Art. 243W] to confer on the Municipalities all such powers and authority as may be necessary to enable them to function as institutions of self-government. It has specifically been mentioned that they may be given the responsibility of (a) preparation of plans for economic development and social justice, (b) implementation of schemes as may be entrusted to them, and (c) in regard to matters listed in the 12th schedule. This schedule contains 18 items, e.g., Urban Planning, Regulation of Land Use, Roads and Bridges, Water Supply, Public Health, Fire Services Urban Forestry, Slums etc.
Powers to impose taxes and financial resources:
A State Legislature may by law authorise a Municipality to levy, collect and appropriate taxes, duties, tolls etc. The law may lay down the limits and prescribe the procedure to be followed. It can also assign to a Municipality various taxes, duties etc. collected by the State Government. Grants-in-aid may be given to the Municipalities, from the Consolidated Fund of the State.
Panchayat Finance Commission:
The Finance Commission appointed under Art. 243-I (see Chapter 18 under Panchayat Finance Commission) shall also review the financial position of the Municipalities and make recommendations as to-
Elections of Municipalities:
The State Election Commission appointed under Art. 243K shall have the power of superintendence, direction and control of (i) the preparation of electoral rolls for, and (ii) the conduct of all elections to the Municipalities. State Legislatures have been vested with necessary power to regulate by law all matters relating to elections to Municipalities.
Bar to interference by courts in electoral matters:
The courts shall have no jurisdiction to examine the validity of a law, relating to delimitation of constituencies or the allotment of seats made under Art.243ZA. An election to a Municipality can be called in question only by an election petition which should be presented to such authority and in such manner as may be prescribed by or under any law made by the State Legislature.
Committees for (a) District Planning and (b) Metorpolitan Planning:
Apart from giving constitutional recognition to Municipalities the 74th Amendment lays down that in every State two committees shall be constituted.
The composition of the committees and the manner in which the seats are to be filled are to be provided by a law to be made by the State Legislature. But it has been laid down that,--
in case of the District Planning Committee at least 4/5th of the members shall be elected by the elected members of the district level Panchayat and of the Municipalities in the district from amongst themselves. Their proportion would be in accordance with the ratio of urban and rural population of the district.
in case of Metropolitan Planning Committee at least 2/3rd of the members of the committee shall be elected by the Members of the Municipalities and Chairpersons of the Panchayats in the Metropolitan area from amongst themselves. The proplortion of seats to be shared by them would be based on the ratio of the population of the Municipalities and the Panchayats in the area.
The State legislature would by law make provision with respect to (i) the functions relating to district planning that may be assigned to the district committees, and (ii) the manner in which the Chairperson of a district committee may be chosen.
The Committee shall prepare and forward the development plan to the State Government. In regard to the Metropolitan Planning Committee which is to prepare a development plan for the whole Metropolitan area the State Legislature may by law make provision for
The development plan shall be forwarded to the State Government.
Addition to the duties of the Finance Commission under Article 280:
This part adds one more function to the duties cast on the Finance Commission appointed by the President under Art.280. The Commission will make recommendations in regard to the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Municipalities in the State on the basis of the recommendations made by the State Finance Commission.
Urban planning including town planning.