Centre & State Relations - Questions and Answers

ANSWER: A-3, B-4, C-1, D-2

Explanation:

• Article 268 - Taxes levied by the centre but collected and appropriated by the states.


• Stamp duties on bills of exchange, cheques, promissory notes, policies of insurance, transfer of shares, etc.


• Duties of excise on medicinal and toilet preparations (having alcohol and narcotics in them).


• The proceeds of these duties do not form a part of the Consolidated Fund of India, but are assigned to that state.

Article 268-A - Service tax levied by the centre but collected and appropriated by the centre and the states -


• Principles of their collection and appropriation are formulated by the Parliament.

Article 269 - Taxes levied and collected by the centre but assigned to the states -


• Taxes on the sale or purchase of goods (other than newspapers) and consignment of goods during inter-state trade or commerce.


• The net proceeds of these are not part of the Consolidated Fund of India.

Article 270 - Taxes levied and collected by the centre but distributed between the centre and the states -

All taxes and duties in the Union List except -

(a) Duties and taxes mentioned in Articles 268, 268-A and 269;

(b) Surcharge on taxes and duties - Article 271 and

(c) Any cess levied for specific purposes.


• President on the recommendation of the Finance Commission determines the manner of distribution of the net proceeds of these.

Article 271 - Surcharge on certain taxes and duties for purposes of the centre -


• Surcharges on taxes and duties in Articles 269 and 270 can be levied by Parliament.


• Centre gets these entire proceeds. States get no share of these.


• Taxes Levied and Collected and Retained by the States - Taxes mentioned in State list and belonging to the states exclusively. They are 20 in number.

ANSWER: 2, 3, 4

Explanation:

Major sources of non-tax revenue of Centre -

• Posts, telegraphs, railways, banking, escheat and lapse, coinage and currency, broadcasting, and currency and Central Public Service Enterprises.

Major sources of non-tax revenue of State -

• Forests, irrigation, escheat and lapse, fisheries and State Public Service Enterprises.

Statutory Grants -

• As per Article 275 Parliament can decide which states are in need of financial assistance and can provide them with grants-in-aid.


• These grants-in-aid are given every year and are charged on the Consolidated Fund of India.


• Parliament can decide which state should be given how much amount.


• The Constitution also provides for specific grants.


• They can be for promoting the welfare of the scheduled tribes in a state or for improving the administration of the scheduled areas in a state including the State of Assam.


• The Finance commission recommends providing all the statutory grants (under Article 275) to the states.

Discretionary Grants -

• Article 282 - The Union or a State may make any grants for any public purpose, even if that purpose is not one within their scope of legislative authority.


• Planning Commission recommends the Union and States to make grants under this provision.


• As per M. P. Jain, “These grants are also known as discretionary grants, the reason being that the Centre is under noo bligation to give these grants and the matter lies within its discretion. These grants have a two-fold purpose: to help the state financially to fulfill plan targets; and to give some leverage to the Centre to influence and coordinate state action to effectuate the national plan.”


• Since, the discretionary grants have become larger than the other grants like the statutory grants, Planning Commission has assumed greater significance than the Finance Commission

Other Grants -

• These grants-in-aid are for a temporary period.


• Under this, grants in lieu of export duties on jute and jute products were provided to the States of Assam, Bihar, Orissa and West Bengal.


• They were charged on the Consolidated Fund of India.


• They were made on the recommendation of the Finance Commission.

ANSWER: All of the above

Explanation:

Parliament makes laws on subjects in State List in the following scenarios -

When Rajya Sabha passes a resolution to that effect -


• Parliament can make laws on a matter in state list, if the Rajya Sabha says that it is necessary in the national interest that Parliament should make laws on that matter.


• This resolution must be supported by two-thirds of the members of Rajya Sabha, present and voting.


• The resolution remains in force only for one year.


• It can be renewed again and again but not exceeding one year at a time.


• The laws made under the resolution too cease to have effect on the expiration of six months after the resolution has ceased to be in force.


• The state legislature toocan make laws on the same matter, but, in case of conflict parliamentary law prevails.

During a National Emergency -

• When a proclamation of national emergency is in operation, parliament can legislate on subjects of the state list.

• Here too the laws become ineffective on the expiry of six months after the emergency has ceased to operate.

• Here again, state can make laws but in case of conflict parliamentary law prevails.

When States make a request for it -

• Parliament can also make laws on subjects in the state list when the legislatures of two or more states pass resolutions requesting the Parliament to enact laws on that matter.


• This law enacted by the Parliament will apply only to the concerned states i.e., states who have passed such a resolution.


• But even other states are allowed to adopt the law by passing a resolution in their legislatures.


• However only Parliament can amend or repeal such a law.


• The state legislature looses the power to make a law with respect to that subject.


• Some examples are -Transplantation of Human Organs Act, 1994; Prize Competition Act, 1955; Wild Life (Protection) Act, 1972; Water (Prevention and Control of Pollution) Act, 1974, etc.

For implementing International Agreements -

• For implementing the international treaties, agreements or conventions, the Parliament is authorized to make laws on any subject in the State List.

• Examples - Legislations related to TRIPS; Anti-Hijacking Act, 1982; etc.

During President’s Rule -

• Parliament can make laws with respect to any subject in the State List in relation to that state, when President’s rule is in force in that state.

• Even if the President’s Rule ends, the law remains in force in the state.

• However, State legislature can repeal or alter or re-enact that law.

ANSWER: 1, 3, 4

Explanation:

• Legislative Relations between Centre and State are described in Articles 245 to 255 in Part 11 of the Constitution.


• Apart from these there are some other articles too.

Distribution of legislative subjects amongst Centre and states -

• Legislative Subjects are divided into 3 lists in the 7^th schedule.


• Only Union government can legislate on subjects in Union List.


• Only State Government can legislate on subjects in State List.


• Both Union and State Governments and legislate on subjects in concurrent List.


• There is dominance of Union list over other two lists and that of concurrent list over state list.


• Also, in case of conflict, the dominant list always prevails.


• If there is a conflict between the Union law and the state law on a subject of the Concurrent List, then the Union law prevails.


• However there is one exception to it.


• If the state law has been reserved for the consideration of the president and has received his assent, then the state law prevails in that state.


• However, here again the Parliament can override this state law by making a law on the same matter.

Extent of Union and State Laws -

• Parliament can make laws for entire India or a part of it.


• State can make laws for whole state or part of it.


• ‘Extra-territorial legislation’ can be made only by Parliament. These kinds of legislations can be applied to Indian citizens and their property, etc. in any part of the world.


• Also the President, governor, etc. can make legislations for scheduled areas and scheduled tribes.


• They can direct that laws of parliament will not apply or apply with changes to certain areas.

Parliamentary legislation in state field -

Parliament can make laws on subjects in state list -

(a) If Rajya Sabha passes such a resolution

(b) During a national emergency

(c) When two or more states make a request for it

(d) For implementing international agreements

(e) During President’s rule in the state

Union’s control and authority over State legislations -

• The governor can reserve certain state legislations for consideration of the President.


• During a financial emergency the President can ask the states to reserve their financial bills including money bills for his consideration.


• Certain bills on state subjects can be introduced in state legislature only with prior approval of the President.

ANSWER: a and b

Explanation:

• Article 355 - It shall be the duty of the Union to protect every State against external aggression and internal disturbance and to ensure that the Government of every State is carried on in accordance with the provisions of this Constitution.

During the national emergency (under Article 352) -

• The Centre can give executive directions to a state on ‘any’ matter.


• The state is not suspended but is brought under complete control of the Centre.


• The president can cancel o change the constitutional distribution of revenues between the Centre and the states.


• Such changes continue till the end of the financial year in which the emergency ceases to operate.


• During President’s Rule (under Article 356) in a state, the President assumes power of the governor or any other executive authority as he pleases.

During financial emergency (under Article 360) -

• The Centre can order the states to observe laid down regulations while taking financial decisions.


• The President can even ask the reduction of salaries of high court judges, etc.


• The Union Government or the President can ask the states to reserve their financial bills including money bills for his consideration.


• Thus during emergencies Indian polity becomes unitary and the Union enjoys supreme powers.

ANSWER: All of the above

Explanation:

Recommendations of the Sarkaria Commission

• A commission was appointed on Centre-state relations by Union government in 1983.


• It was headed by R. S. Sarkaria.

It recommended -

1. Inter-State Council (Inter-Governmental Council) should be set up under Article 263.

2. The zonal councils should be constituted again.

3. Use Article 356 (President’s Rule) as a last resort.

4. Make it constitutional provision to consult state chief Minister while appointing governor for the state.

5. Provide more secure 5 year term for the Governor. Governor should not be removed unless there is a proper reason.

6. Strengthen All-India Services.

7. Activating Commissioner for linguistic minorities.

8. Residuary powers of taxation should continue to remain with the Parliament.

9. Other residuary powers should be in the Concurrent List.

10. Uniformly implement the three language formula in its true spirit.

11. Decentralization of radio and television operations.

12. Reason to withhold Presidential assent to state bills, should be toldto state government.

13. Centre should be able to deploy its armed forces, even without the consent of states.

14. Before making a law on a subject of the Concurrent List, the Centre should consult the states.

15. As long as the Council of Ministers enjoy majority in the assembly, the governor cannot dismiss the council of ministers.

16. Until and unless a demand has been made by the Parliament, no commission of enquiry should be set up against a state minister.

17. Continue present division of functions between the Finance Commission and the Planning Commission.

ANSWER: Only 2

Explanation:

Provisions for borrowingby Centre and the States -

• The Central government can borrow either within India or outside.


• The security provided would be the Consolidated Fund of India.


• It can even give guarantees on basis of the Fund.


• Both these rights need to be within the limits fixed by the Parliament.


• A state government can borrow within India only.


• The security provided would be the Consolidated Fund of the State.


• Even state government can give guarantees.


• Both these rights need to be within the limits fixed by the concerned state legislature.


• State government cannot raise loans from outside India.


• The Central government can give loans to any state.


• It can also give guarantees for loans raised by any state.


• Any amount needed for the purpose of making these loans are charged on the Consolidated Fund of India.


• A state cannot raise any loan without the permission of the Centre, if there is still any part of a loan made to the state by the Centre outstanding.


• They raise any loan without the permission of the Centre if for previous any loan a guarantee has been given by the Centre.

Tax Immunities for Centre and state properties -

• The property of Centre is exempted from all taxes imposed by a state.


• They are exempted from tax of any authority within a state like municipalities, Panchayats, etc.


• But, the Parliament can remove this ban.


• The property may be used for sovereign(like armed forces) or commercial purposes.


• State and local authorities can tax the corporations or the companies created by the Union government because they are a separate legal entity.


• The property and income of a state is exempted from Central taxation but corporations and companies of a state are not.


• If Parliament provides the Centre can tax the commercial operations of a state.


• The property and income of local authorities located within a state are not exempted from the Central taxation.


• Immunity to a state in respect of taxation by union does not extend to the duties of customs or excise.

ANSWER: All of above

Explanation:

• Administrative relations between Centre and States are dealt in Articles 256 to 263 in Part 11 of the Constitution.

Executive Power distribution -

• The executive power division is on similar lines as the legislative power distribution.


• A law on concurrent subject has to be implemented by the state even if it is enacted by Parliament.

Obligation of States and the Centre -

• The executive power of every State shall be so exercised as to ensure compliance with the laws made by Parliament and any existing laws which apply in that State.


• The executive power of every State shall be exercised in manner so as not to impede the exercise of the executive power of the Union.


• Article 365 - Where any State has failed to comply with, or to give effect to, any directions given in the exercise of the executive power of the Union under any of the provisions of this Constitution, it shall be lawful for the President to hold that a situation has arisen in which the Government of the State cannot be carried on in accordance with the provisions of this Constitution.


• After this, the President’s rule can be imposed in the state under Article 356.

Directions to the States by Union -

• The executive power of the Union shall also extend to giving directions to a State for measures to be taken for the protection of the railways within the State.


• The executive power of the Union shall also extend to the giving directions to a State as to the construction and maintenance of means of communication which are of national and military importance.


• Centre can give directions to States for provision of adequate facilities for instruction in mother-tongue at primary stage.


• Centre can also direct states to draw and execute specified schemes for the welfare of the Scheduled Tribes in the state.

Mutual Delegation of Functions -

• With the consent of the state government, the President may entrust to that government any of the executive functions of the Centre.


• Also with the consent of the Union government, the governor of a state may entrust to Union government any of the executive functions of the state.


• Centre can entrust its executive functions to a state without the consent of that state.


• But here it is the Parliament that is delegating and not the President.


• But, state cannot entrust executive functions on the Union government without Union government’s consent.

Cooperation between the Centre and States -

• Parliament can provide for adjudication river water disputes.


• Under Article 263, an Inter-State Council can be developed.


• Full faith and credit is to be given to public acts, records an djudicial proceedings of the Centre and every state throughout India.

All-India Services -

• The members of these services occupy top positions (or key posts) under both the Centre and the states and serve them by turns.


• They are recruited and trained by the Centre.


• Though controlled jointly the final control lies with the Central government.


• Under Article 312, Parliament can create new All-India Services.


• These services they help in maintaining high standard of administration in the Centre as well as in the states and ensure uniformity of the administrative system throughout the country.

Public Service Commissions -

• Removal of various officials of state public service commissions is done by President only.


• Parliament can establish Joint State Public Service Commission.

Integrated Judicial System -

• This enforces both the Central laws as well as the state laws.


• This removes differences in the methods of seeking remedy.


• The judges of a state high court can be removed only by the president.


• Parliament can establish a common high court for two or more states.

ANSWER: Only 1, 2 and 4

Explanation:

The subject in concurrent list is Weights and measures except establishment of standards. Establishment of standards is under union List. Concurrent list currently has 52 subjects.

Few important subjects in the concurrent list are -

1. Criminal Law, including all matters included in the Indian Penal Code. 2. Marriage and divorce; infants and minors; adoption; wills, intestacy and succession; joint family and partition. 3. Transfer of property other than agricultural land; registration of deeds and documents. 4. Administration of justice; constitution and organization of all courts, except the Supreme Court and the high courts. 5. Contempt of court, but not including contempt of the Supreme Court. 6. Vagrancy; nomadic and migratory tribes. 7. Lunacy and mental deficiency. 8. Prevention of cruelty to animals. 9. Forests. 10. Protection of wild animals and birds. 11. Adulteration of foodstuffs and other goods. 12. Drugs and poisons. 13. Economic and social planning.

14. Population control and family planning. 15. Commercial and industrial monopolies, combines and trusts. Trade unions; industrial and labor disputes. 16. Social security and social insurance; employment and unemployment. 17. Welfare of labour. 18. Education, including technical education, medical education and universities. 19. Legal, medical and other professions. 20. Relief and rehabilitation of persons 21. Vital statistics including registration of births and deaths. 22. Ports other than major ports. 23. Shipping and navigation on inland waterways. 24. Weights and measures except establishment of standards. 25. Price control. 26. Electricity. 27. Newspapers, books and printing presses. 28. Archaeological sites and remains other than those of national importance.

ANSWER: Only 1

Explanation:

• The Constitution distributes legislative subjects between the Centre and the state sin the Seventh Schedule.

The 7th schedule has 3 lists -


• List-I (the Union List), List-II (the State List) and List-III (the Concurrent List).


• The Parliament can make laws with respect to any of the matters mentioned in the Union List.


• It is its exclusive power.


• This list at present has 100 subjects (originally 97 subjects) like banking,foreign affairs, defense, atomic energy,communication, inter-state trade and commerce, census, insurance, audit etc.


• In normal situations, the state legislature can make laws with respect to any of the matters mentioned in the State List.


• It is its exclusive power.


• This list at present has 61 subjects (originally 66 subjects) like public order, police, agriculture public health and sanitation, fisheries, prisons, local government, , markets, gambling, etc.


• On matters mentioned in the Concurrent List, both the Parliament and state legislature can make laws.


• This list at present has 52 subjects (originally 47 subjects) like marriage and divorce, criminal law and procedure, civil procedure, electricity, population control and family planning, labor welfare, economic and social planning, newspapers, books and printing press,drugs etc.


• The 42^nd AmendmentActof1976 transferred five subjects to Concurrent List from State List.
  They are -
  
  1. Education.
  
  2. Forests.
  
  3. Weights and measures except establishment of standards.
  
  4. Protection of wild animals and birds.
  
  5. Administration of justice; constitution and organization of all courts except the Supreme Court and the high courts.

ANSWER: Only 2 and 3

Explanation:

Corporation tax comes in the Union List.

State List currently has 61 subjects. Few important subjects in the State list are -

1. Public order. 2. Police. 3. Officers and servants of the high court. 4. Prisons, reformatories, borstal institutions and other such institutions. 5. Local government. 6. Public health and sanitation. 7. Pilgrimages, other than pilgrimages to places outside India. 8. Burials and burial grounds. 9. Libraries,museums and other similar institutions; ancient and historical monuments and records other than those of national importance. 10. Communications, that is, roads, bridges, ferries and other means of communication not specified in List I. 11. Agriculture, including agricultural education and research. 12. Water, that is, water supplies, irrigation and canals, drainage and embankments, water storage and water power. 13. Fisheries. 14. Regulation of mines and mineral development. 15. Industries. 16. Markets and fairs. 17. Money-lending and money-lenders; relief of agricultural indebtedness. 18. Corporation, other than those specified in List I, and universities; unincorporated trading, literacy, scientific, religious and other societies and associations; co-operative societies. 19. Theaters and dramatic performances; cinemas; sports, entertainments and amusements. 20. Betting and gambling.

21. Elections to the legislature of the state. 22. Salaries and allowances of members and presiding officers of the legislature of the state. 23. Powers, privileges and immunities of the legislature of the state and of the members and the committees thereof. 24. Salaries and allowances of ministers for the state. 25. States public services; State Public Service Commission. 26. Land revenue, including maintenance of land records. 27. Taxes on agricultural income. 28. Taxes on mineral rights. 29. Duties of excise on alcoholic liquors for human consumption; opium, Indian hemp and other narcotic drugs and narcotics, but not including medicinal and toilet preparations containing alcohol. 30. Taxes on goods and passengers carried by road or on inland waterways. 31. Taxes on vehicles. 32. Taxes on animals and boats. 33. Tolls. 34. Taxes on professions, trades, callings and employments. 35. Taxes on luxuries, including taxes on entertainments, amusements, betting and gambling. 36. Rates of stamp duty in respect of documents other than those specified in Union List. 37. Offences against laws with respect to any of the matters in this list. 38. Jurisdiction and powers of all courts, except the Supreme Court, with respect to any of the matters in this list.

ANSWER: All of the above

Explanation:

Union List consists of 100 subjects currently. Some of the important subjects in it are -

1. Defense of India. 2. Cantonment areas and local self-government in those areas. 3. Arms, firearms, ammunition & explosives. 4. Atomic energy and mineral resources necessary for its production. 5. Foreign affairs. 6. Entering into treaties and agreements with foreign countries and their implementation. 7. War and peace. 8. Citizenship, naturalization and aliens. 9. Extradition. 10. Passports and visas. 11. Pilgrimages to places outside India. 12. Piracies and crimes committed on the high seas or in the air and offences against the law of nations. 13. Railways. 14. Highways declared to be National highways. 15. Shipping and navigation on national waterways. 16. Maritime shipping and navigation. 17. Major ports. 18. Posts and telegraphs; telephones, wireless, broadcasting and other like forms of communication. 19. Currency, coinage and legal tender; foreign exchange. 20. Foreign loans. 21. Reserve Bank of India. 22. Post office savings bank. 23. Lotteries organized by the Union Govt. or state Govt. 24. Trade and commerce with foreign countries. 25. Inter-state trade and commerce. 26. Incorporation, regulation & winding up of trading corporations, including banking, insurance and financial corporations but not including co-operative societies. 27. Incorporation, regulation & winding up of corporations, whether trading or not, with objects not confined to one state. 28. Banking. 29. Insurance. 30. Stock exchange and futures markets. 31. Patents, inventions and designs; copyright; trade-marks and merchandise marks. 32. Establishment of standards of weight and measure.

33. Regulation and development of Oil fields and mineral oil resources; petroleum and petroleum products; other liquids and substances which are inflammable. 34. Regulation of mines and mineral development in the public interest. 35. Regulation and development of inter-state rivers and river valleys. 36. Fishing and fisheries beyond territorial waters. 37. Manufacture, supply and distribution of salt by Union and other agencies. 38. Cultivation and manufacture of opium and its export. 39. Institutions of national importance. 40. BHU, the Aligarh Muslim University and the Delhi University; any other institution of national importance. 41. Ancient and historical monuments and records, and archaeological sites and remains of national importance. 42. The Survey of India, the Geological, Botanical, Zoological and Anthropological Surveys of India; Meteorological organizations. 43. Census. 44. Union Public Services; All-India Services; Union Public Service Commission. 45. Audit of the accounts of the Union and of the states. 46. Constitution, organization, jurisdiction and powers of the Supreme Court. 47. Constitution, organization of the high courts. 48. Extension of the powers and jurisdiction of members of a police force belonging to any state to any area outside that state. 49. Inter-state migration; inter-state quarantine. 50. Taxes on income other than agricultural income. 51. Duties of customs including export duties. 52. Duties of excise on tobacco and other goods except alcoholic liquors for human consumption and opium, Indian hemp and other narcotic drugs and narcotics, but including medicinal and toilet preparations containing alcohol. 53. Corporation tax. 54. Taxes on the capital value of the assets exclusive of agricultural land, of individuals and companies; taxes on the capital of companies. 55. Duties in respect of succession to property other than agricultural land. 56. Terminal taxes on goods or passengers, carried by railway, sea or air; taxes on railway fares and freights. 57. Taxes other than stamp duties on transactions in stock exchanges and futures markets. 58. Rates of stamp duty in respect of bills of exchange, cheques, promissory notes, bills of lading,letters of credit,policies of insurance, transfer of shares, debentures, proxies and receipts. 59. Taxes on the sale or purchase of newspapers and on advertisements published therein. 60. Taxes on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-state trade or commerce. 61. Taxes on services. 62. Jurisdiction and powers of all courts except the Supreme Court with respect to any of the matters in this list; admiralty jurisdiction. 63. Any other matter not enumerated in List II or List III including any tax not mentioned in either of those lists.