Distribution of Powers: Our Constitution is one of the very few that has gone into details
regarding the relationship between the Union and the States. A total of 56 Articles from Article
245 to 300 in Part XI and XII are devoted to the State-Centre relations. Part XI (Articles 245-
263) contains the legislative and administrative relations and Part XII (Articles 246-300) the
financial relations. By going into great details of the relations, the Constitution framers hope
to minimize the conflicts between the Centre and the states. By and large, the confrontations
between the two have been minimal.
The Centre-State relations are divided into three parts, which are mentioned below:
1. Legislative Relations (Articles 245 to 255)
2. Administrative Relations (Articles 256 to 263)
3. Financial Relations (Articles 268 to 293)
I. Legislative Relations:
Articles 245 to 255 in part XI and chapter I of the Indian constitution deal with the
Legislative Relations between the Union and the States.
1. The Parliament makes laws for the whole or any part of the Territory of India.
2. The Parliament can make laws for the Union territories.
3. The Parliament has Exclusive power to make the laws with respect to any of the matters
enumerated in list – I (Union list) in the 7th Schedule.
4. The Legislature of a state has Exclusive powers to make laws in List-II (State list) in
the 7th schedule.
5. The Parliament and the State Legislature of a State have powers to make laws in the
List-III in the 7th schedule.
6. The Parliament may make laws with respect to any matter for any part of the territory
of India not included in a state (UT) even if such matter may fall in the State list.
7. The Parliament has Exclusive powers to make laws with regard to any matter is not
included in any of the Lists.
8. The Parliament can make laws with respect to the state list in certain circumstances
such as the matter Related to National Importance, during the period of National
Emergency, if two or more states request the Parliament to make laws and
Implementing any Treaty or Agreement of International nature.
Articles 245 to 255 in Part XI deals with different aspects of legislative relations between
Centre and states. These include:
Territorial jurisdiction of laws made by the Parliament and by the Legislatures of States.
Distribution of legislative subjects
Power of parliament to legislate with respect to a matter in the State List
Centre's control state legislation
However, the Seventh Schedule of the Constitution provides for the distribution of
legislative powers between the Centre and the States. The legislative subjects are divided into
List I (the Union List), List II (the Concurrent List) and List III (the State List). At present,
there are 100 subjects in the Union list which includes subjects such as foreign affairs, defence,
railway, postal services, banking, atomic energy, communication, currency etc. At present,
there are 61 subjects in the State list. The list includes subjects such as police, public order,
roadways, health, agriculture, local government, drinking water facilities, sanitation etc. At
present, there are 52 subjects in the concurrent list. The list includes subjects such as education,
forests, protection of wild animals and birds, electricity, labour welfare, criminal law and
procedure, civil procedure, population control and family planning, drugs etc.
Article 245 empowers the Centre to give directions to the States in certain cases in regards to
the exercise of their executive powers.
Article 249 empowers the parliament to legislate with respect to a matter in the State List in
the national interest.
Under Article 250, the parliament becomes empowered to make laws on the matters related to
State list when national emergency (under Article 352) is in operation.
Under Article 252, the parliament is empowered to legislate for two or more States by their
consent.
II. Administrative Relations:
Articles 256 to 263 in part XI of our constitution deal with the administrative relations
between the union and states. They are discussed under the following heads; a) During
Emergencies b) In Normal Times
a) During Emergencies: During the operation of a National Emergency, the Union
government will work as a Powerful body. The State governments are brought under the
Parliament complete control. However, they can’t be suspended by the union. When The
President Rule is imposed in a state the president can assume the power of the state government.
He can assigns such functions to the governor. During the Financial Emergency, the union
government can directs to the state governments on the matters of financial property. The
president can issues directions including the reductions of salaries of the state government
Employees and High Court Judges.
b) In Normal Times: In Normal Times, our Constitution has devised techniques of control
over the states by the Union to ensure that the state governments do not interfere with the
Legislative and Executive policies of the Union. The union government is empowered to issue
directions to the state governments in the following matters;
1. To ensure due compliance with the Union laws in the implementation of the State laws.
2. To ensure protection of Railways within the state.
3. To secure the provisions of the adequate facilities for the instruction in the Mother
Tongue at the Primary stage to Linguistic minorities.
4. To ensure the development of Hindi language.
5. To devise and execute schemes for the welfare of the Tribal communities as mentioned
in the directions.
6. To issue directions to the State for the welfare of the Schedule castes and Schedule
tribes.
7. The Union government can appoint, transfer or remove the dignitaries in the state like
judges of the High court, members of the State Public Service Commission.
8. The President is empowered to constitute an Inter-state council to advice the states in
settling their disputes.
9. The President is empowered to constitute a Joint Public Service Commission to serve
the needs of two or more states.
10. The Central government is also empowered to appoint Enquiry committee to conduct
enquiry against the Chief Minister of the states.
Article 256 to 263 deals with the administrative relations between the Centre and the states.
Article 256 states that "the executive power of every State shall be so exercised as to ensure
compliance with the laws made by the parliament and any existing laws which apply in that
State, and the executive power of the Union shall extend to the giving of such directions to a
State as may appear to the Government of India to be necessary for that purpose".
Cooperation between the Centre and the States: The constitution lays down various
provisions to secure cooperation and coordination between the Centre and the States. These
include:
A. Article 261 states that "Full faith and credit shall be given throughout the territory of
India to public acts, records and judicial proceedings of the Union and of every State".
B. According to Article 262, the parliament may by law provide for the adjudication of
any dispute or complaint with respect to the use, distribution or control of the waters
of, or in, any inter-State river or river valley.
C. Article 263 empowers the President to establish an inter-State Council to inquire into
and advise upon disputes between states, to investigate and discuss subjects in which
some or all of the States, or the Union and one or more of the States, have a common
interest.
D. As per Article 307, Parliament may by law appoint such authority as it considers
appropriate for carrying out the purposes of the constitutional provisions related to the
inter-state freedom of trade and commerce.
III. Financial Relations:
Articles 268 to 293 in part XII of the Constitution deal with the Centre-State financial
Relations. The Relations between the Centre and the States can be discussed under the
following heads.
a. Taxes and Duties levied by the Centre: There are certain taxes which are exclusively
assigned to the union. These include Customs and Export duties, Income tax, Tobacco,Export duties, Taxes on the capital value of the Assets, Income tax, Railways, Agriculture
Land, Post and Telegraphs, Telephones, foreign exchange, Currency and Coinage etc.
b. Taxes and Duties levied and used by the State: Certain items of Revenue fall under the
exclusive jurisdiction of the state government. There are Land Revenue, Taxes on goods
and Passengers carried by Road and Inland Water, Taxes on utilised Electricity, Sales tax,
duty on Alcoholic liquors for human consumption, taxes on Entertainment, Betting, and
Gambling etc.
c. Taxes levied by the Union but collected and appropriated by States: Revenue from the
following items is collected and appropriated by the states. These include Stamp duties on
bill of Exchange, Cheques, Promissory Notes, Transfer of shares, Excise duties on Medical
Materials and Opium etc.
d. Taxes levied and collected by the Union but Assigned to states: The taxes on certain
items are levied and collected by the union but exclusively allotted to the states. These are;
railway freight, terminal taxes on goods or passengers carried by Rail, Sea or Air, estate
duty in respect of property other than agricultural land.
e. Taxes Levied and collected by the Union and distributed among the Union and the
States: There are certain items, on which the taxes are levied and collected by the union
but shared with the states. Such items are; tax on income other than agricultural income,
excise duties on items other than medical materials.
f. Financial Relations between Union and States during Financial Emergency: During
the proclamation Financial Emergency, the President can give financial directions to the
States. The President can suspend the Grant-in-Aid to the states. The President can issue
directions to reduce the Salaries and other Allowances of the government employees
including the Judges. During the Financial emergency’s the states are utilise left only with
Revenue available under the State List and other Resources can be controlled as per the
wishes of the centre.
g. Union government Grants-in-aid and Loans to the states:
a. Grants-in-aid: The union government provides grants-in-aid to the states for different
purposes. These grants are generally given for the purpose of Financing Development
Programmes for promoting the Welfare of Scheduled castes, Scheduled Tribes and
Backward classes or Budget deficit or for helping the states during Natural calamities like
Drought, Floods and Earthquakes etc.
b. Advancement of Central Loans: Besides Grants in aid, the Union government may
advance loans to the state governments and also give security to the loans by the Union
government within the provisions of the constitution.
The Constitution deals with the Centre-state financial relations in Article 268-293 of Part XII.
Allocation of taxing powers The Constitution has provided the union government and the state
governments with the independent sources of revenue. It allocates the powers to Centre and
the states in the following way:
The parliament has exclusive power to levy taxes on the subjects mentioned in the
Union List.
The State Legislatures has exclusive power to levy taxes on the subjects mentioned in
the State List
Both the parliament and the state legislature are empowered to levy taxes on the
subjects mentioned in the Concurrent List.
The parliament has exclusive power to levy taxes on the matters related to the residuary
subjects.
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