Panchayati Raj and Community Development (Part-IV)

Total Questions: 48

11. Who amongst the following is responsible for revenue distribution between the State Government and the Local Governments? [U.P.P.C.S. (Pre) 2013]

Correct Answer: (c) State Finance Commission
Solution:The State Finance Commission established under Article 243(I) by the Governor is responsible for the distribution of revenue between the State Government and the Local Governments.

State Finance Commission

-The Governor of a State shall constitute a State Finance Commission, after every five years, to review the financial position of the Panchayats.
-The State Legislature may provide for the composition of the State Finance Commission, the required qualifications of its members, and the manner of their selection.
-The State Finance Commission shall make the following recommendations to the Governor of the State:
1. The principles that should govern:
a. The distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees levied by the State and the allocation of shares amongst the Panchayats at all levels.
b. The determination of taxes, duties, tolls, and fees that may be assigned to the Panchayats.
c. The grants-in-aid to the Panchayats from the Consolidated Fund of the State.
2. The measures needed to improve the financial position of the Panchayats.
3. Any other matter referred to by the Governor in the interests of sound finance of the Panchayats.
- The Governor shall place the recommendations of the commission along with the action taken report before the State Legislature.
- The Central Finance Commission shall also suggest the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats
in the States (on the basis of the recommendations made by the State Finance Commission).

12. Under which Article of the Indian Constitution the State Finance Commission is established — [Uttarakhand U.D.A./L.D.A. (Pre) 2003]

Correct Answer: (b) Article 243(I)
Solution:The provision for establishment of State Finance Commission is made under Article 243(I). This commission is established to review the financial condition of Panchayati Raj Institutions.

State Finance Commission

-The Governor of a State shall constitute a State Finance Commission, after every five years, to review the financial position of the Panchayats.
-The State Legislature may provide for the composition of the State Finance Commission, the required qualifications of its members, and the manner of their selection.
-The State Finance Commission shall make the following recommendations to the Governor of the State:
1. The principles that should govern:
a. The distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees levied by the State and the allocation of shares amongst the Panchayats at all levels.
b. The determination of taxes, duties, tolls, and fees that may be assigned to the Panchayats.
c. The grants-in-aid to the Panchayats from the Consolidated Fund of the State.
2. The measures needed to improve the financial position of the Panchayats.
3. Any other matter referred to by the Governor in the interests of sound finance of the Panchayats.
- The Governor shall place the recommendations of the commission along with the action taken report before the State Legislature.
- The Central Finance Commission shall also suggest the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats
in the States (on the basis of the recommendations made by the State Finance Commission).

13. Which one of the following authorities recommends to the Governor about the principles of determination of taxes and fees which may be appropriated by the Panchayats of that state? [I.A.S. (Pre) 2010]

Correct Answer: (b) State Finance Commission
Solution:The State Finance Commission constituted under Article 243(1) recommends the Governor the principles which govern the determination of taxes, duties, tolls and fees which may be assigned to, or appropriated by the Panchayats.

State Finance Commission

-The Governor of a State shall constitute a State Finance Commission, after every five years, to review the financial position of the Panchayats.
-The State Legislature may provide for the composition of the State Finance Commission, the required qualifications of its members, and the manner of their selection.
-The State Finance Commission shall make the following recommendations to the Governor of the State:
1. The principles that should govern:
a. The distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees levied by the State and the allocation of shares amongst the Panchayats at all levels.
b. The determination of taxes, duties, tolls, and fees that may be assigned to the Panchayats.
c. The grants-in-aid to the Panchayats from the Consolidated Fund of the State.
2. The measures needed to improve the financial position of the Panchayats.
3. Any other matter referred to by the Governor in the interests of sound finance of the Panchayats.
- The Governor shall place the recommendations of the commission along with the action taken report before the State Legislature.
- The Central Finance Commission shall also suggest the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats
in the States (on the basis of the recommendations made by the State Finance Commission).

14. Who recommends to the Governor the principles which should govern the distribution between the state and the panchayats of the net proceeds of the taxes and Fees leviable by the State, which may be divided between them? [Chhattisgarh P.C.S. (Pre) 2019]

Correct Answer: (c) State Finance Commission
Solution:The State Finance Commission constituted under Article 243(1) recommends the Governor the principles which govern the determination of taxes, duties, tolls and fees which may be assigned to, or appropriated by the Panchayats.

State Finance Commission

-The Governor of a State shall constitute a State Finance Commission, after every five years, to review the financial position of the Panchayats.
-The State Legislature may provide for the composition of the State Finance Commission, the required qualifications of its members, and the manner of their selection.
-The State Finance Commission shall make the following recommendations to the Governor of the State:
1. The principles that should govern:
a. The distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees levied by the State and the allocation of shares amongst the Panchayats at all levels.
b. The determination of taxes, duties, tolls, and fees that may be assigned to the Panchayats.
c. The grants-in-aid to the Panchayats from the Consolidated Fund of the State.
2. The measures needed to improve the financial position of the Panchayats.
3. Any other matter referred to by the Governor in the interests of sound finance of the Panchayats.
- The Governor shall place the recommendations of the commission along with the action taken report before the State Legislature.
- The Central Finance Commission shall also suggest the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats
in the States (on the basis of the recommendations made by the State Finance Commission).

15. Consider the following statements and select the correct answer using the code given below: [U.P.P.C.S. (Mains) 2011]

Assertion (A): The Union Finance Commission does not have any role in considering measures for providing financial assistance to local bodies.

Reason (R): In spite of the 73rd and 74th Constitutional Amendments, local government continues to be a state subject in the Seventh Schedule of the Constitution.

Correct Answer: (d) (A) is false, but (R) is true.
Solution:The Finance Commission is constituted under Article 280 of the Constitution of India. The functions of Finance Commission also includes recommendations in regards to the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats and the Municipalities in the State on the basis of the recommendations made by the State Finance Commission. Therefore, Assertion (A) is wrong, but Reason (R) is correct. Thus, option (d) is the correct answer.

16. Study the following statements and select the correct answer from the code given below: [U.P.P.C.S. (Pre) (Re-Exam) 2015]

Assertion (A): The State Election Commission is a Constitutional authority.
Reason (R): Elections to rural local bodies are overseen by the Election Commission of India.

Correct Answer: (d) (A) is true, but (R) is false.
Solution:The State Election Commission constituted under the 73rd and 74th Constitutional (Amendments) Act, 1992, for each State / Union Territory. SECs are vested with the powers of conducting the elections to the corporations, municipalities, Zilla Parishads, District Panchayats, Panchayat Samitis, Gram Panchayats and other local bodies. The Election Commission of India has no role in these elections.

State Finance Commission

-The Governor of a State shall constitute a State Finance Commission, after every five years, to review the financial position of the Panchayats.
-The State Legislature may provide for the composition of the State Finance Commission, the required qualifications of its members, and the manner of their selection.
-The State Finance Commission shall make the following recommendations to the Governor of the State:
1. The principles that should govern:
a. The distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees levied by the State and the allocation of shares amongst the Panchayats at all levels.
b. The determination of taxes, duties, tolls, and fees that may be assigned to the Panchayats.
c. The grants-in-aid to the Panchayats from the Consolidated Fund of the State.
2. The measures needed to improve the financial position of the Panchayats.
3. Any other matter referred to by the Governor in the interests of sound finance of the Panchayats.
- The Governor shall place the recommendations of the commission along with the action taken report before the State Legislature.
- The Central Finance Commission shall also suggest the measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats
in the States (on the basis of the recommendations made by the State Finance Commission).

17. Which of the following are Constitutional Authorities? Select the correct answer using the code given below: [U.P.P.C.S. (Pre) 2012, U.P.P.C.S. (Mains) 2012]

1. State Election Commission
2. State Finance Commission
3. District Panchayat
4. State Electoral Officer
Correct Answer: (b) 1, 2 and 3 Only
Solution:State Election Commission under Article 243(K), State Finance Commission under Article 243(I) and District Panchayat Under Article 243(B) are Constitutional authorities while the State Electoral Officer or Chief-Electoral Officer are not Constitutional authorities.

State Election Commission

State Election Commission is a constitutional body, functioning at the state level.
-It is vested with the functions and responsibilities of superintendence, direction, and control of the preparation of electoral rolls and the conduct of all elections to the Panchayats.
- The State Election Commission (SEC) consists of a State Election Commissioner to be appointed by the Governor of the State.
a. His/her conditions of service and tenure of office shall also be determined by the Governor.
b. He/she shall not be removed from the office except in the manner and on the grounds prescribed for the removal of a judge of the State High Court.
c. His/her conditions of service shall not be varied to his/her disadvantage after his/her appointment.

18. Which of the following parts of the Constitution is related to Municipalities? [U.P. Lower Sub. (Mains) 2015]

Correct Answer: (d) Part IX-A
Solution:Part IX - A of the Indian Constitution which was added by the 74th Amendment Act, 1992, is related to municipalities. It came into force on 1st June 1993.
  • Municipalities, also known as Urban Local Bodies (ULBs) refer to the system of 'Urban Local Self-Governance' in India i.e. a system of governance of Urban Areas through the representatives elected by the people.
  • They have been established in urban areas across all States as the third tier of government, aiming to build democracy at the local level.
  • This system ensures that urban populations participate directly in the decision-making process, thereby enhancing the effectiveness and accountability of urban development initiatives.

19. Which of the following statements regarding the 74th Amendment to the Constitution of India are correct? [U.P. B.E.O. (Pre) 2019]

1. It provides the insertion of a new Schedule to the Constitution.

2. It restructures the working of the Municipalities.

3. It provides the reservation of seats for women in Municipalities.

4. It is applicable only to some specified States.

Select the correct answer from the codes given below:

Correct Answer: (a) 1, 2 and 3 are correct
Solution:The Constitution (Seventy-fourth Amendment) Act, 1992 gave constitutional status to the municipalities. This Act has added a new Part IX-A, and consists of Provisions from Article 243 P to 243 ZG. In addition, the Act has also added a new 12th Schedule and 18 functional items of Municipalities.
This act came into force on 1st June, 1993. Some of the characteristics of this act are as follows:
  1. It provides for constitution of three types of municipalities - Nagar Panchayat, Municipal Council, Municipal Corporation.
  2. The municipalities have a fixed term of 5 years from the date appointed for its first meeting.
  3. According to Article 243-T, seats shall be reserved for the SC and ST in every municipality, and the number of seats so reserved shall bear, as nearly as may be, the same proportion to the total number of seats to be filled by direct election in that municipality as the population of the SC in the municipal area or of the ST in the municipal area bears to the total population of that area, and such seats may be allotted by rotation to different constituencies in the municipality.
  4. It is applicable in all states.

Thus, statements 1, 2, and 3 are correct, while 4 is incorrect.

20. Which of the following Constitutional Amendment Acts accorded Constitutional Status to the Municipalities? [U.P. Lower Sub. (Mains) 2013]

Correct Answer: (b) The Constitution (74th Amendment) Act, 1992
Solution:Part IX-A (Article 243P-243ZG) was inserted by 74 Amendment of the Constitution in 1992 to give a Constitutional status to the units of local self governance in urban areas. A new Schedule (12 Schedule) was also added by this Amendment Act.

The salient features of the 74th Constitutional Amendment Act of 1992 are as follows:

  • Three Types of Municipalities - The Act provides for three types of Municipalities in every State - Nagar Panchayat, Municipal Council, and Municipal Corporation.
  • Composition of Municipalities - The Act provides for the composition of Municipalities and the way of election/nomination of their members.
  • Ward Committees and Other Committees - The Act empowers the State Legislature to make provisions for the constitution of Ward Committees and Other Committees for specified areas and for specified purposes.
  • Election of Chairperson and Members - The Act provides detailed provisions regarding the election of Members and Chairperson of Municipalities.
  • Reservation of Seats - The Act makes provisions for the reservation of seats for Scheduled Castes, Scheduled Tribes, Women, and OBCs in Municipalities.
  • Duration of Municipalities - The Act provides for a five-year term of office to every Municipality from the date of its first meeting.
  • Disqualifications of Members of Municipalities - It details conditions regarding disqualifications of members of Municipalities.
  • Powers and Functions - The State Legislature may endow the Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self-government.
  • Finances of Municipalities - The State Legislature may authorize a Municipality to levy, collect, and appropriate taxes, duties, tolls, and fees.
  • Audit of Accounts-The State Legislature may make provisions with respect to the maintenance of accounts by Municipalities and the auditing of such accounts.
  • Application to Union Territories - The provisions of the Municipalities are applicable to the Union Territories. However, the President may direct that they would apply to a Union Territory subject to such exceptions and modifications as specified by the President of India.
  • Exempted Areas - The Act does not apply to the Scheduled Areas and Tribal Areas in the States. However, the Parliament may extend the provisions of Municipalities to the Scheduled Areas and Tribal Areas subject to such exceptions and modifications as it may specify.