Federalism, Devolution & Local Governance — Practice

Question 1

Explain how repugnancy between a central and a state law on a Concurrent List subject is resolved. (10 marks, ~150 words)

Accepted Answer

Article 254 governs repugnancy on Concurrent List subjects. The general rule under Article 254(1) is that where a state law is repugnant to a central law on the same subject, the central law prevails and the state law is void to the extent of the inconsistency. Article 254(2) creates the significant exception: a state law that is repugnant to an earlier central law may nonetheless prevail within that state if it has been reserved for the President's consideration and has received presidential assent. Even then, the proviso preserves Parliament's supremacy — Parliament remains free to enact a subsequent law on the same subject, amending, varying or repealing the state law notwithstanding that assent. The practical significance is that Article 254(2) gives states a route to legislative variation on Concurrent subjects, but the route runs through the Union executive's discretion in granting assent, and any variation obtained remains permanently vulnerable to subsequent parliamentary override.

Question 2

Under what circumstances can Parliament legislate on a State List subject, and what does this reveal about Indian federalism?

Accepted Answer

Parliament can legislate on State List subjects in several defined circumstances. Under Article 249, it may do so if the Rajya Sabha passes a resolution supported by not less than two-thirds of members present and voting declaring it necessary in the national interest, with such a law valid for one year at a time. Under Article 250, Parliament acquires power over the entire State List during a national emergency. Under Article 252, two or more states may request Parliament to legislate on a State List subject, with the resulting law applying to those states and any others that subsequently adopt it. Under Article 253, Parliament may legislate on any subject to implement an international treaty or agreement. What this reveals is the asymmetry at the heart of Indian federalism: the State List is not an exclusive domain in the way a genuinely coordinate federal division would make it, and Parliament possesses several distinct constitutional routes into it while states have no reciprocal route into the Union List. This is consistent with Article 1's description of India as a 'Union of States' rather than a federation formed by agreement among constituent units.

Question 3

"The office of the Governor has become the principal source of friction in Indian federalism." Critically examine, referencing relevant commission recommendations. (15 marks, ~250 words)

Accepted Answer

The claim is substantially defensible, and the reasons are structural rather than attributable to particular incumbents. The Governor is appointed by the President on the Union government's advice, holds office during the President's pleasure under Article 156 with no security of tenure, and exercises significant discretionary powers over a state government the Union does not control. An office that is centrally appointed, centrally removable, and discretionarily powerful will generate friction regardless of who occupies it.

The flashpoints are specific and recurring. Article 200 permits the Governor to reserve a bill for the President's consideration without prescribing any timeline, which has enabled state legislation to be held indefinitely without formal refusal. The discretion in inviting a party to form a government in a hung assembly has repeatedly been exercised in ways favouring the party governing at the Union. The reporting function under Article 356 makes the Governor the initiator of central intervention. The chancellorship of state universities has more recently added a further contested domain.

Both major commissions on Centre-State relations addressed the office directly. The Sarkaria Commission (1988) recommended that the Governor be a detached figure not intensely involved in local politics, appointed after consultation with the Chief Minister, and that reasons be communicated when state bills are vetoed. The Punchhi Commission (2010) went further — an eminent person from outside the state, a defined removal procedure including impeachment by the state legislature, and an end to the chancellorship practice.

The most citable fact remains that neither set of recommendations has been implemented in substance. The friction is therefore not an unforeseen development but a known structural problem with identified remedies that successive Union governments, of varying political composition, have declined to adopt.

Question 4

Explain the significance of S.R. Bommai v. Union of India (1994) for the working of Article 356. (15 marks, ~250 words)

Accepted Answer

Before Bommai, Article 356 had been invoked frequently, and the prevailing understanding treated the President's satisfaction as subjective and effectively beyond judicial scrutiny. The nine-judge bench in S.R. Bommai reversed that understanding and established the framework that governs the provision today.

The judgment established four propositions of continuing operative significance. First, a proclamation under Article 356 is subject to judicial review — the President's satisfaction must rest on relevant material, and courts may examine whether such material existed, though they will not substitute their own assessment of its adequacy. Second, the majority of a state government is to be tested on the floor of the House, not through the Governor's subjective assessment of party strengths, which removed the most frequently misused discretionary judgment. Third, the power may be exercised only where there is a genuine breakdown of constitutional machinery, not where the Union merely disapproves of a state government's policies or composition. Fourth, dissolution of the assembly should await parliamentary approval of the proclamation, and where a proclamation is struck down, the Court may restore the dissolved assembly and the displaced government — a remedy that gives the review real consequence rather than merely declaratory effect.

The judgment's practical impact is measurable: recourse to Article 356 declined substantially after 1994 relative to the preceding decades. Its significance extends beyond federalism, since the same judgment held secularism to be part of the basic structure, making it citable in a second, quite distinct set of questions. The Sarkaria Commission's recommendation that the proclamation be a 'speaking document' stating its reasons complements the holding directly, since reasons never stated cannot be reviewed.

Question 5

Explain the role of the Finance Commission and the contestation surrounding its horizontal devolution formula.

Accepted Answer

The Finance Commission, constituted every five years under Article 280, makes two distinct recommendations that a precise answer separates. The vertical recommendation determines the share of the divisible pool of central taxes to be devolved to the states collectively. The horizontal recommendation determines the formula distributing that share among individual states. The horizontal formula is where the contestation sits, because its criteria have distributive consequences that fall unevenly across states. Income distance — the gap between a state's per capita income and that of the highest-income state — carries substantial weight and directs more resources toward poorer states, which is defensible on equity grounds but is experienced by higher-income states as a penalty on economic performance. Population raises a distinct grievance: southern states that achieved earlier demographic transition argue that using more recent population figures penalises them for successful population control, a concern partially addressed by including a demographic performance criterion rewarding states with lower fertility. Area and forest cover criteria compensate states for territorial administrative costs and for maintaining forest cover that yields national environmental benefits while foregoing development in those areas. The underlying difficulty is that equity and efficiency criteria pull in opposite directions, and any formula must trade one against the other rather than satisfying both.

Question 6

What is vertical fiscal imbalance in Indian federalism, and how does the Constitution address it?

Accepted Answer

Vertical fiscal imbalance refers to the structural mismatch between the two levels of government's revenue-raising capacity and their expenditure responsibilities. The Union collects the more buoyant and elastic taxes — income tax, corporation tax, customs, and the central component of GST — while the states carry the larger share of expenditure responsibility in the sectors that dominate public spending and public expectations: health, education, police, agriculture, irrigation and rural development. Left uncorrected, this would leave the states constitutionally responsible for services they could not finance. The Constitution addresses the gap through transfer rather than by reassigning taxation powers, principally through the Finance Commission mechanism under Article 280, which recommends devolving a share of central tax revenue to the states as untied funds they may spend according to their own priorities. Two further channels supplement this: grants-in-aid under Article 275, including specific-purpose grants, and centrally sponsored schemes, which transfer resources but attach central conditions and typically require state matching contributions. The critical distinction for an answer is between untied devolution, which preserves state expenditure discretion, and tied scheme transfers, which direct state spending toward Union-determined priorities — the balance between these two channels being a live and recurring federal controversy.

Question 7

"Centrally sponsored schemes undermine the fiscal autonomy that Finance Commission devolution is meant to protect." Critically examine. (15 marks, ~250 words)

Accepted Answer

The tension the statement identifies is real, though the conclusion requires qualification rather than straightforward acceptance.

The case for the criticism is structural. Finance Commission devolution transfers untied funds that states may allocate according to their own assessment of local priorities — this is what makes it a genuine instrument of fiscal federalism rather than merely a transfer of money. Centrally sponsored schemes operate differently: they attach central conditions on design, coverage, beneficiary criteria and often implementation machinery, and typically require a state matching contribution. That matching requirement is what converts a scheme into a constraint on autonomy, since a state that declines to participate forfeits the central share entirely, while a state that participates must divert its own resources toward a centrally determined priority that may not match its own assessment of local need. A state facing a scheme it considers ill-suited to its circumstances therefore has no costless option.

Three qualifications weigh against the criticism. First, several schemes address genuinely national objectives with cross-state spillovers — communicable disease control, nutrition — where uniform minimum standards are defensible and purely state-determined provision would likely underprovide. Second, successive restructuring exercises have reduced the number of schemes and increased flexibility within them, including through flexi-funds allowing states to adapt a proportion of scheme spending to local conditions. Third, states are not passive recipients: the design of several schemes has been modified in response to state resistance and Council-level negotiation.

The defensible position is that centrally sponsored schemes do constrain autonomy in a way untied devolution does not, and that the appropriate corrective is not their abolition but a continued shift in the balance between tied and untied transfers, alongside greater state involvement in scheme design at the formulation stage.

Question 8

State the key provisions introduced by the 73rd Constitutional Amendment.

Accepted Answer

The 73rd Amendment, passed in December 1992 and in force from April 1993, inserted Part IX ('The Panchayats') into the Constitution, giving rural local government constitutional status for the first time rather than leaving it to state discretion. Its key provisions establish a three-tier structure of panchayats at village, intermediate and district levels, with the intermediate tier optional for states below a population threshold. Elections are to be held every five years and are conducted by a State Election Commission, an independent constitutional authority insulated from the state government that the panchayats are meant to hold ground against. Seats are reserved for Scheduled Castes and Scheduled Tribes in proportion to their population, and not less than one-third of all seats and chairperson positions are reserved for women — a floor many states have since raised to one-half. Where a panchayat is dissolved before its term, elections must be held within six months, preventing indefinite supersession by state governments. A State Finance Commission is to be constituted every five years to recommend the distribution of resources between the state and its local bodies. The Eleventh Schedule lists 29 subjects that may be devolved to panchayats, and Article 243G empowers state legislatures to endow panchayats with the powers and authority necessary to function as institutions of self-government.

Question 9

Three decades after the 73rd Amendment, why do panchayats in most states still lack effective authority? (15 marks, ~250 words)

Accepted Answer

The explanation begins with a drafting choice rather than with implementation failure. Article 243G provides that the state legislature 'may' endow panchayats with such powers and authority as may be necessary to enable them to function as institutions of self-government — permissive rather than mandatory language. The Eleventh Schedule's 29 subjects are consequently a menu from which states may select, not a binding transfer, and the constitutional amendment therefore created the institutional shell of local self-government while leaving the substantive transfer of power to the discretion of the very state governments that would lose authority by making it.

The predictable consequence is that devolution has been partial and highly uneven, with a large majority of states not having devolved all 29 functions even in formal terms, and formal devolution frequently not matched by effective transfer.

The three-F framework — functions, funds, functionaries — explains why formal devolution alone changes little. Where functions are listed as devolved but the associated budget lines remain with state line departments, the panchayat is responsible for an outcome it cannot finance. Where funds follow but staff do not, the panchayat has money but no administrative capacity to deploy it, since the personnel who would implement remain answerable to state departments rather than to the elected local body. All three must move together for authority to be real, and in most states at least one has been withheld.

Two further constraints compound this. State Finance Commissions, the mechanism meant to give local bodies predictable resources, have frequently been constituted late and their recommendations often not acted upon. And parallel agencies headed by state officials continue to perform functions nominally devolved, leaving elected panchayats to coexist with an unelected structure that retains the resources and the decision-making.

Question 10

Why is the State Election Commission's independence significant for local governance?

Accepted Answer

The State Election Commission, established under Article 243K for panchayats and Article 243ZA for municipalities, is vested with the superintendence, direction and control of the preparation of electoral rolls and the conduct of all elections to local bodies. Its independence matters because the single most effective way for a state government to neutralise an inconvenient local body is not to abolish it but simply to avoid holding elections to it — leaving the body superseded, under an administrator, or with an expired term indefinitely. Placing election conduct with an independent constitutional authority rather than with the state government removes that option, and the accompanying requirement that elections be held before the expiry of a five-year term, and within six months of any premature dissolution, converts the guarantee into a specific timeline. The State Election Commissioner's conditions of service carry protection comparable in structure to that of a High Court judge, and removal is subject to similar constraints, reflecting that the office must be able to act against the interests of the government that appointed it. Where this independence has been tested — through delayed elections attributed to ward delimitation or reservation-rotation disputes — the resulting litigation has generally reinforced the position that the constitutional timeline is binding rather than aspirational.

Question 11

What distinguishes the challenges facing urban local bodies under the 74th Amendment from those facing rural panchayats?

Accepted Answer

The 74th Amendment created a parallel constitutional framework for municipalities through Part IXA and the Twelfth Schedule's 18 subjects, but urban local bodies face a partly different set of constraints. The first difference is the scale and technical complexity of their functional domain: water supply, sewerage, solid waste management, urban transport and building regulation require substantial technical and financial capacity that most municipal bodies lack, and that a rural panchayat's functional range does not equally demand. The second is the proliferation of parastatal agencies — development authorities, water supply and sewerage boards, and metropolitan transport corporations — which perform core municipal functions while remaining answerable to the state government rather than to the elected municipal body, fragmenting urban governance in a way with no close rural equivalent. The third is the weakness of the mayor's office in most states: mayors frequently serve short terms, are often indirectly elected, and typically lack executive authority, which rests instead with a state-appointed municipal commissioner — meaning the elected head of an urban local body may have less executive power than the appointed official reporting to the state. The fourth is fiscal: municipal revenue bases have been eroded by the subsuming of local taxes into GST, while property tax, the principal remaining own-source revenue, is widely under-assessed and under-collected.

Question 12

What is the Inter-State Council, and why has it been described as an underused federal institution?

Accepted Answer

The Inter-State Council is established under Article 263, which empowers the President to constitute a body to inquire into and advise on disputes between states, to investigate and discuss subjects of common interest to the Union and the states, and to make recommendations for better policy coordination. It was constituted in 1990, following the Sarkaria Commission's recommendation that a permanent body of this kind be established as a forum for structured Centre-State consultation. It is described as underused because its potential and its practice have diverged: the Council is advisory rather than decision-making, its meetings have been infrequent and irregular over much of its existence, and substantive Centre-State negotiation has tended to occur through other channels — bilateral engagement, the Finance Commission process, and more recently the GST Council. The contrast with the GST Council is instructive and worth drawing in an answer: the GST Council has functioned actively precisely because it has defined decision-making authority over a specific domain with a structured voting formula, whereas the Inter-State Council has broad advisory scope but no binding authority over anything. This suggests that the institutional lesson is not simply that the Council should meet more often, but that consultative federal forums acquire significance when they carry decision-making consequence.

Question 13

Explain the concept of asymmetric federalism with reference to India, and assess whether it strengthens or weakens the federal structure. (15 marks, ~250 words)

Accepted Answer

Asymmetric federalism describes an arrangement in which constituent units of a federation do not all stand in an identical relationship to the centre, some holding powers or protections that others do not. India's constitutional structure is asymmetric in several respects rather than uniformly federal.

The clearest instances are the Article 371 family of provisions, which grant specific states tailored arrangements: protections for customary law and land rights in several north-eastern states, special responsibilities for the Governor in respect of particular regions, and distinct administrative arrangements for defined areas within states. The Fifth and Sixth Schedules create further asymmetry, providing distinct governance frameworks for Scheduled Areas and for tribal areas in the north-east, including autonomous district councils with their own legislative and judicial functions. Union territories constitute a third form of asymmetry, with Delhi and Puducherry holding legislatures while others are administered directly.

The case that this strengthens federalism rests on accommodation: uniform arrangements imposed on regions with genuinely distinct histories, land systems and social structures would have generated pressure that the federal structure would then have had to contain, whereas tailored provisions convert potential grievance into an accommodated constitutional status. India's comparative record in retaining regions with strong distinct identities within the union, examined in the post-independence reorganisation context, supports this reading.

The case that it weakens federalism is that asymmetry can institutionalise permanent difference, complicate uniform administration, and invite claims of preferential treatment from states not similarly favoured.

On balance the accommodative reading is better supported by the record: asymmetric provisions have generally functioned as stabilisers, and where regional discontent has escalated it has typically been where accommodation was withheld or withdrawn rather than where it was extended.

Question 14

How do the All India Services function as an instrument of administrative federalism, and why are they contested?

Accepted Answer

The All India Services — principally the Indian Administrative Service, Indian Police Service and Indian Forest Service — are constituted under Article 312, which permits Parliament to create such services if the Rajya Sabha, the chamber representing the states, passes a resolution supported by two-thirds of members present and voting. Officers are recruited centrally, allotted to state cadres, and serve in state administration for most of their careers, while disciplinary control and cadre management remain with the Union. The design intent was integrative: a common administrative corps serving both levels was expected to supply uniform standards, transmit national perspective into state administration, and provide officers with sufficient independence from local political pressure to enforce the law impartially, since their careers do not depend solely on the state government they serve. The arrangement is contested because that same dual control creates divided loyalty. A state government exercises day-to-day control over an officer whose career prospects, disciplinary proceedings and central deputation depend substantially on the Union, and proposals to make central deputation easier without state concurrence have been resisted by states as eroding their control over their own administration. The underlying tension is genuine and structural: the very independence from state political control that makes the services valuable to the Union is what makes state governments regard them as an instrument of central influence within state administration.

Question 15

Distinguish cooperative federalism from competitive federalism, and assess which better describes India's current federal practice. (15 marks, ~250 words)

Accepted Answer

Cooperative federalism describes an arrangement in which the Union and the states function as collaborative partners in shared policy domains, negotiating jointly through institutional forums rather than operating in separate spheres. Competitive federalism describes states competing against one another — for investment, for scheme performance rankings, for ease-of-doing-business scores — with the Union acting as evaluator and incentiviser rather than as a joint decision-maker.

Both are visible in current Indian practice, and the honest assessment is that the two operate simultaneously in different domains. The GST Council is the strongest institutional expression of cooperative federalism, giving states a structured, weighted voice in tax decisions previously taken separately. NITI Aayog's design as an advisory and coordinating body, replacing the Planning Commission's allocative role, was explicitly framed in cooperative terms. On the competitive side, state-level ranking exercises across ease of doing business, scheme implementation and sectoral performance have become a routine instrument of central policy, and states compete actively for investment through incentives.

The assessment turns on what each model does to state capacity and autonomy. Competitive federalism can raise administrative performance by making outcomes visible and comparable, but it disadvantages states starting from weaker fiscal and institutional positions, since the same effort produces worse rankings, and it can encourage a race to the bottom in taxation and regulation. Cooperative federalism accommodates capacity differences better but can slow decisions and, where the Union's blocking share is used routinely, may become cooperative only in form.

The defensible conclusion is that India's practice is mixed but has tilted toward competitive framing, and that the cooperative institutions matter most precisely because they are what prevent competition from becoming purely extractive for weaker states.

Practice — Federalism, Devolution & Local Governance

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