DROANACHARYA - IAS | GENERAL STUDIES

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HANDOUT- INDIAN POLITY

TOPIC- LOCAL GOVERNMENT

PANCHAYATI RAJ INSTITUTIONS-

INTRODUCTION- Panchayati Raj Institutions in simple terms signify the system of rural local self
government . The Panchayati Raj Institutions are also mandated under Art 40 (DPSP)- “The State shall
take steps to organise village panchayats and endow them with such powers and authority as may be
necessary to enable them to function as units of self-government

 From ancient times rural local self governments have been vital point of administration at local level
example- sabha , samiti etc. Village level panchayat is an important Gandhian dream which is clearly
reflect in his life. Post constitution, the states constituted village panchayat but there was no
uniformity or constitution compulsion.
 The union government also attempted rural transformation through village panchayats- Balwant Rai
Mehta committee 1957, Ashok Mehta committee 1978 (report submitted), GVK Rao committee(not by
government but by planning commission)(1986,report submitted), Sub committee of parliament under
PK Thungon 1988.
 The 73rd CAA came into force on 24 April 1993 which is celebrated as Panchayati Raj Day. 73rd CAA
added part 9 (243 to 243(o)) and 11th schedule with 29 subjects. The Act has given a practical shape to
Article 40 of the Constitution. The provisions of the Act can be grouped into two categories–
compulsory and voluntary. The compulsory (mandatory or obligatory) provisions of the act have to be
included in the state laws creating the new panchayati raj system. The voluntary provisions, on the
other hand, may be included at the discretion of the states.

PROVISION RELATED TO PANCHAYAT-

1. Three-Tier System-The Act provides for a three-tier system of panchayati raj in every state, I e,
panchayats at the village, intermediate, and district levels but a state having a population not
exceeding 20 lakh may not constitute panchayats at the intermediate level.
2. Members at all the 3 levels are directly elected
3. The chairman at village level is elected in the manner as determined by state legislature
4. Chairman at intermediate and district level is elected indirectly from the members amongst
themselves
5. Reservation for women- Not less than 33 % seats shall be reserved for women at all level (including the
number of seats reserved for women belonging the SCs and STs). Further, not less than one-third of the
total number of offices of chairpersons in the panchayats at each level shall be reserved for women.
6. Gram Sabha- It means a body consisting with the persons registered in electoral roll (voter list) of a
village within the village panchayat. It may exercise such powers and perform such functions at the
village level as the legislature of a state determines.
7. Reservation for SC/ST-The seats shall be reserved for SC/ ST as per their population (no 50 % rule) in
every panchayat (i.e., at all the three levels). Further, the state legislature shall provide for the
reservation of offices of chairperson in the panchayat at the village or any other level for the SCs and
STs

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8. Tenure of panchayat- unless sooner dissolved, shall continue for 5 years from the date appointed for
its first meeting. Elections to constitute a panchayat shall be completed before the expiry of a period
of six months from the date of its dissolution.
But, where the remainder of the period (for which the dissolved panchayat would have continued) is
less than six months, it shall not be necessary to hold any election for constituting the new panchayat
for such period.
Panchayat reconstituted after premature dissolution does not enjoy the full period of five years but
remains in office only for the remainder of the period.
9. Qualification – Decide by state legislature and additional ground of disqualification of any. Minimum
age is mention in constitution- 21 years
10. Functions- It empowers the state legislature to determine devolution of powers to the Panchayati Raj
Institutions for enabling them to function as units of self government, it is with special reference to-
preparing plans for economic development and social justice and implementing schemes including
those wrt 11th schedule.
The state legislature may by law authorize the panchayat to levy, collect, appropriate – duties, taxes,
tolls etc.
11. The Act also authorises the legislature of a state to make any provision for reservation of seats in any
panchayat or offices of chairperson in the panchayat at any level in favour of backward classes
12. State Election Commission- The superintendence, direction and control related to preparation of
electoral roll, conduct of elections are done by constitutional body under article 243(k) w r t Panchayati
Raj Institutions and urban local bodies. State election commission is headed by state election
commissioner who is a constitutional authority and removed in the manner similar to that of High
Court judge. State election commissioner to be appointed by the governor. His conditions of service
and tenure of office shall also be determined by the governor. His conditions of service shall not be
varied to his disadvantage after his appointment. State legislature may make provision with respect to
all matters relating to elections to the panchayats.
13. State Finance Commission- The governor of a state shall, after every five years It is constitutional
body to make recommendation wrt –
a. Distribution between state and panchayat net proceeds of taxes, duties, tolls, fees levied by the state
b. Determination of taxes to be assigned to Panchayati Raj Institutions and Urban Local Bodies
c. Grant- in- aid to the panchayats from consolidated funds of state.
 Every recommendation of State Finance Commission shall be laid before the legislature of state
along with action taken.
 The qualification of members and composition of finance commission shall be determined by an
Act of state legislature

14. Audit of Accounts- The state legislature may make provisions with respect to the maintenance of
accounts by the panchayats and the auditing of such accounts.
15. Application to Union Territories- The provisions of this Part are applicable to the Union territories. But,
the President may direct that they would apply to a Union territory subject to such exceptions and
modifications as he may specify
16. The validity of any law relating to the delimitation of constituencies or the allotment of seats to such
constituencies, shall not be called in questioned in any court.

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17. No election to any Panchayat shall be called in question except by an election petition presented to
such authority and in such manner as is provided for by or under any law made by the Legislature of a
State.

MAJOR ISSUES WITH PANCHAYATI RAJ INSTITUTIONS

A. The Panchayati Raj Institutions lacks financial autonomy and are constrained of financial resources
B. States are reluctant to devolve substantial powers especially related to taxation
C. Some states do not constitute State Finance Commission on time or even fail to properly implement
the recommendations of State Finance Commission
D. The real empowerment of women get stifled because of the Mukhiapati concept. The women have
become titular or ceremonial head.
E. The Panchayati Raj Institutions-Lack infrastructure , elected representatives lack skills, official structure
is also not uniform and lacks trained personal.

URBAN LOCAL BODIES-

INTRODUCTION- The system of urban government was constitutionalised through the 74th Constitutional
Amendment Act of 1992. Municipalities are dealt between Art 243p to 243zg(part 9 A). 74th CAA added
schedule 12 in the constitution

PROVISIONS-
1. Constitution classifies municipality into 3 types
a. Nagar panchayat- a transition area from rural to urban
b. Municipal council- for a smaller urban area
c. Municipal corporation – for a larger urban area

Factors determining classification-

a. Population of area
b. Population density
c. Revenue generation for local administration
d. Percentage of employment in non- agricultural activities
2. The municipalities are classified into territorial constituencies known as wards where all the seats are
filled by the direct election.
3. Reservation for women- Not less than 1-3rd seats are reserved for women (horizontal reservation)
(including the number of seats reserved for woman belonging to the SCs and the STs). The state
legislature may provide for the manner of reservation of offices of chairpersons in the municipalities
for women.
4. Reservation for SC/ST-The seats shall be reserved for SC/ ST as per their population (no 50 % rule) in
every panchayat (i.e., at all the three levels . Further, the state legislature shall provide for the
reservation of offices of chairperson in the panchayat at the village or any other level for the SCs and
STs

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5. The seats for backward classes of citizens are reserved in the manner provided by state legislature
through Act of state legislature
6. Tenure- Same as that of Panchayati Raj Institutions, The Act also makes two more provisions with
respect to dissolution: (a) a municipality must be given a reasonable opportunity of being heard before
its dissolution; and (b) no amendment of any law for the time being in force shall cause dissolution of a
municipality before the expiry of the five years term.
7. The municipalities shall enjoys such power and authority specially with reference to – preparation of
plans for economic development and social justice and entrusting functions related to those matters in
12th schedule and others.
8. Qualification- The minimum age to contest election shall be 21 years. A person shall be disqualified for
being chosen as or for being a member of a municipality if he is so disqualified (a) under any law for the
time being in force for the purposes of elections to the legislature of the state concerned; or (b) under
any law made by the state legislature.

RELATED ASPECTS

DISTRICT PLANNING COMMITTEE- It is constitutional body mention in Article 243 ZD.

 The prime mandate of it is to consolidate the plans prepared by panchayat and municipalities for
district as a whole.
 The legislature of state shall determine the composition of such committee, manner in which seats
shall be filled. Although four-fifths of the members of a district planning committee should be elected
by the elected members of the district panchayat and municipalities in the district from amongst
themselves. The representation of these members in the committee should be in proportion to the
ratio between the rural and urban populations in the district
 The chairperson of every District planning committee shall forward the development plan to the
government of the state. In simple terms, this committee develops a draft plan highlighting the areas
of common interest keeping in mind the resources. This committee may also consult such institutions
and organizations, governor may by order specify.

METROPOLITAN PLANNING COMMITTEE

• Each metropolitan area is required to establish a metropolitan planning committee responsible for
formulating a preliminary development plan.
• The state legislature has the authority to determine the composition and election process for these
committees. Although two-thirds of the members of a metropolitan planning committee should be elected
by the elected members of the municipalities and chairpersons of the panchayats in the metropolitan area
from amongst themselves
• The allocation of seats on the committee should be based on the population ratio between municipalities
and panchayats in that specific metropolitan area.
• The development plan developed by these committees must be submitted to the state government by
their respective chairpersons.

MUNICIPAL CORPORATION-
• Municipal corporations are established in states through legislation enacted by the respective state
legislatures, while in union territories, they are established by acts of the Parliament of India. Each

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municipal corporation may operate under a common act for all municipal corporations in a state or have
a separate act dedicated to it.
• A municipal corporation comprises three key bodies: the council, standing committees, and the
commissioner.
a. The council serves as the legislative body and consists of elected Councillors chosen directly by the
public. It also includes a few nominated individuals with expertise or experience in municipal
administration, as mandated by the 74th Constitutional Amendment Act. The Mayor leads the Council.
b. Standing committees are established to streamline the operations of the council, which can be quite
large. These committees handle matters related to public works, education, health, taxation, finance, and
more.
c. The municipal commissioner, functioning as the executive authority, is responsible for executing the
decisions made by the council and its standing committees. Appointed by the state government, the
municipal commissioner is typically a member of the Indian Administrative Service (IAS).

MUNICIPALITIES-
 Municipalities are established to govern towns and smaller cities, similar to corporations. They are
created in states through legislation passed by the respective state legislatures, and in union territories,
they are established through acts of the Parliament of India.
 These municipalities may have various titles, such as municipal council, municipal committee, or
municipal board, among others. They function through three key authorities:

A. The council, serving as the legislative body, comprises Councillors elected directly by the people and is
led by a President or Chairman.
B. Standing committees are set up to facilitate the operations of the council.
C. The Chief Executive Officer or Chief Municipal Officer is responsible for the day-to-day general
administration of the municipality and is appointed by the state government.

CANTONMENT BOARD-
 The Cantonment Board is created to oversee municipal administration in the civilian-populated areas
within a cantonment region. It is established through an Act of Parliament known as the Cantonment
Act of 2006.
 The Cantonment Board operates under the administrative authority of the Ministry of Defence and is
administered by the central government. The Chairman or President of the Cantonment Board serves
as a military officer and holds this position in an ex-officio capacity. The Chief Executive Officers (CEOs)
typically come from the Indian Defence Estate Services.
 The Cantonment Board operates in accordance with the provisions of the Act and comprises members
who are partially elected and partially nominated.

NOTIFIED AREA COMMITTEE-

This is intended for a rapidly growing town that has not yet reached the size to be designated as a
municipality. The Notified Area Committee (NAC) is only subject to the provisions of the Municipal Act
that have been officially published in the state gazette. The establishment of the committee is formally
announced through this gazette publication. It's important to note that the NAC is not a statutory body,
and it typically consists entirely of nominated members.

TOWN AREA COMMITTEE-

It is created through legislation passed by the state legislature, functioning as a semi-municipal authority
with its roles and responsibilities outlined in the Act. Its duties encompass tasks such as managing
drainage systems, roads, and street lighting, among others. The composition of this authority can vary, as
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it may be entirely elected, entirely nominated by the state government, or a combination of elected and
nominated members.

TOWNSHIP
Large public enterprises establish this form of urban governance to offer civic amenities to their employees
and workers residing in housing colonies. The township model of urban governance does not include any
elected representatives

PORT TRUST
Port trusts are established in port areas with the purpose of overseeing and safeguarding the ports while
also delivering civic services. The creation of a port trust is enacted through a Parliamentary Act, and it
typically comprises a combination of elected and appointed members.

MUNICIPAL PERSONNEL
1. Separate Personnel System: Each local body appoints, administers, and controls its own personnel. They
are not transferable to other local bodies.
2. Unified Personnel System: state government appoints, administers, and controls the municipal
personnel. They are transferable between the local bodies in the state.
3. Integrated Personnel System: personnel of the state government and those of the local bodies form
part of the same service.
They are transferable not only between the local bodies in the state but also between local bodies and
departments of state government.

Panchayats (Extension To Scheduled Areas) Act/PESA ACT 1996-

Introduction-The Act extended the provision of the panchayat to scheduled areas under the 5th schedule.
The Act also makes various attempts to empower the gram sabha in tribal areas
Objectives-
a. extend the provision of part 9 to the scheduled areas empower the panchayats in tribal areas
b. To preserve the tribal customs and provisions

Features-
• State legislatures are required to enact laws that align with the customs, social practices, and traditional
norms of tribal communities.
• The gram sabha holds the authority to safeguard these traditions.
• Prior to land acquisition in scheduled areas, consultation with the gram sabha is essential, although the
actual planning occurs at the state level.
• The Act also necessitates that recommendations from the gram sabha or the relevant panchayat level are
mandatory for granting minor minerals in scheduled areas.
• PESA also stipulates that state legislatures must adhere to the guidelines of the 6th schedule when
crafting laws for scheduled areas.

COOPERATIVE SOCIETIES – 97TH AMENDMENT ACT 2011 IXB

FEATURES-
1. Cooperative societies operate on a voluntary basis, allowing individuals with shared interests to join or
leave the organization with proper notice.

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2. The principle of "one member, one vote" is central to cooperative societies, ensuring that each member
has an equal say, regardless of their shareholding. This democratic approach governs the functioning of
these societies.
3. Registration is a legal requirement for cooperative societies under the Cooperative Societies Act. This
registration establishes a separate legal entity, distinct from its individual members. Factors like a
member's death, insolvency, or insanity do not affect the organization's existence. It can take legal
actions, enter into agreements, and manage property in its own name.
4. Cooperative societies prioritize serving their members' needs over profit maximization, setting them
apart from other corporate entities focused primarily on maximizing profits.
5. Members of cooperative societies receive dividends and bonuses based on the organization's revenues,
with bonuses reflecting the volume of business each member conducts with the cooperative.
6. Cooperative societies promote the collective interests of their members through self-help and mutual
assistance, fostering a sense of community and collaboration.

Legal Milestone Concerning Part IXB

The addition of Part IXB to the Constitution addressed the authority of both the State legislatures and the
Union government in regulating the establishment, elections, and management of cooperative
organizations. The Constitution allowed Parliament to create regulations for multi-state cooperatives and
Union Territories. However, a crucial question arose before the Supreme Court: could this amendment
be implemented without the ratification of at least fifty percent of the states?
The argument put forth was that Part IXB might limit the states' ability to govern cooperative societies,
especially since these organizations were already subject to state regulation under Entry 32 of the State
List. In response, a three-judge panel concluded that, "Part IXB, insofar as it applies to cooperative
organizations operating within a state, would indeed require ratification" by the states. Since the states
had not ratified the amendment, the Supreme Court invalidated the provisions of Articles 243ZJ-243ZS,
which outlined the standards for state governments to regulate societies. The court also reiterated the
"fundamental constitutional premise that is considered part of the Constitution's core structure, namely,
that the Constitution is not entirely unitary but rather quasi-federal in nature."By a 2:1 majority, the
bench ruled that "Part IXB of the Constitution of India is applicable solely concerning multi-state
cooperative organizations within the various states and Union Territories of India."
property, and corrupt practices during elections.

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