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Article 280 of the Constitution.
(ii) Devolution from the State Government based on
recommendations of the State Finance Commission as per Art
243-I.
(iii) Loans / grants from the State Government.
(iv) Programme-specific allocation under Centrally Sponso
Schemes and Additional Central Assistance.
(v) Internal Resource Generation (tax and non-tax).
2. Across the country, States have not given adequate attention to
fiscal empowerment of the Panchayats. The Panchayats own
resources are meager. Kerala, Karnataka and Tamil Nadu are
the states which are considered to be progressive in PRIs
empowerment but even there, the Panchayats are heavily
dependent on government grants. One can draw the following
broad conclusions:
(i) Internal resource generation at the Panchayat level is weak. T
is partly due to a thin tax domain and partly due to Panchay
own reluctance in collecting revenue.
(ii) Panchayats are heavily dependent on grants from Union
State Governments.
(iii) A major portion of the grants both from Union as well as the S
Governments is scheme specific. Panchayats have lim
discretion and flexibility in incurring expenditure.
(iv) In view of their own tight fiscal position, State Governments
education, healthcare, water supply, sanitation and m
irrigation even now, it is the State Government which is dire
responsible for implementation of these programmes and he
expenditure.
(vi) Overall, a situation has been created where Panchayats h
responsibility but grossly inadequate resources.
3. Though, in absolute terms, the quantum of funds the
Union/State Government transfers to a Panchayat forms the
major component of its receipt, the PRI’s own resource
generation is the soul behind its financial standing. It is not only
a question of resources; it is the existence of a local taxation
system which ensures people’s involvement in the affairs of an
elected body. It also makes the institution accountable to its
citizens.
4. In terms of own resource collection, the Gram Panchayats are
comparatively in a better position because they have a tax
domain of their own, while the other two tiers are dependent only
on tolls, fees and non-tax revenue for generating internal
resources.
5. State Panchayati Raj Acts have given most of the taxation
powers to Village Panchayats. The revenue domain of the
intermediate and District Panchayats (both tax as well as non-
tax) has been kept much smaller and remains confined to
secondary areas like ferry services, markets, water and
conservancy services, registration of vehicles, cess on stamp
duty and a few others.
6. A study of various State Legislations indicates that a number of
taxes, duties, tolls and fees come under the jurisdiction of the
Village Panchayats. These interalia include octroi, prop-
erty/house tax, profession tax, land tax/cess, taxes/tolls on
vehicles, entertainment tax/fees, license fees, tax on non-
agriculture land, fee on registration of cattle, sanitation/drainage/
conservancy tax, water rate/ tax, lighting rate/tax, education cess
REASONS FOR INEFFECTIVE PERFORMANCE
Even after conferring the constitutional status and protection through
the 73rd Amendment Act (1992), the performance of the Panchayati
Raj Institutions (PRIs) has not been satisfactory and not upto the
expected level. The various reasons for this sub-optimal performance
are as follows7b:
1. Lack of adequate devolution: Many States have not taken
adequate steps to devolve 3Fs (i.e., functions, funds and
functionaries) to the PRIs to enable them to discharge their
constitutionally stipulated function. Further, it is imperative that
the PRIs have resources to match the responsibilities entrusted
to them. While SFCs (state finance commissions) have
submitted their recommendations, not many few States have
implemented these or taken steps to ensure the fiscal viability of
the PRIs.
2. Excessive control by bureaucracy: In some States, the Gram
Panchayats have been placed in a position of subordination.
Hence, the Gram Panchayat Sarpanches have to spend
extraordinary amount of time visiting Block Offices for funds
and/or technical approval. These interactions with the Block staff
office distort the role of Sarpanches as elected representatives.
3. Tied nature of funds: This has two implications. The activities
stated under a certain scheme are not always appropriate for all
parts of the district. This results in unsuitable activities being
promoted or an under-spend of the funds.
4. Overwhelming dependency on government funding: A
review of money received and own source funds shows the
overwhelming dependence of Panchayats on government
funding. When Panchayats do not raise resources and instead
receive funds from outside, people are less likely to request a
social audit.
5. Reluctance to use fiscal powers: An important power
devolved to GP (Gram Panchayat) is the right to levy tax on
property, business, markets, fairs and also for services provided,
like street lighting or public toilets, etc. Very few Panchayats use
their fiscal power to levy and collect taxes. The argument
your own constituency, especially when you live in the
community.
6. Status of the Gram Sabha: Empowering the Gram Sabhas
could have been a powerful weapon for transparency,
accountability and for involvement of the marginalized sections.
However, a number of the State Acts have not spelt the powers
of Gram Sabhas nor have any procedures been laid down for
the functioning of these bodies or penalties for the officials.
7. Creation of Parallel Bodies: Often, Parallel Bodies (PBs) are
created for supposedly speedy implementation and greater
accountability. However, there is little evidence to show that such
PBs have avoided the evils including that of partisan politics,
sharing of spoils, corruption and elite capture. Missions (in
particular) often bypassing mainstream programmes, create
disconnect, duality, and alienation between the existing and the
new structures and functions. PBs usurp the legitimate space of
PRIs and demoralize the PRIs by virtue of their superior
resource endowments.
8. Poor Infrastructure: A large number of Gram Panchayats in the
country do not have even full time Secretary. Around 25 percent
of the Gram Panchayats do not have basic office buildings. The
database for planning, monitoring etc., are lacking in most of the
cases.
A large number of elected representatives of PRIs are semi-
literate or literate and know little about their roles &
responsibilities, programmes, procedures, systems. Often for
want of good, relevant and periodic training, they are not able to
perform their functions properly.
Although all the District and Intermediate Panchayats are
connected with computers, only around 20% Gram Panchayats
reported to be having computing facility. In some States, Village
Panchayats do not have any computing facility.
Table 38.2 Articles Related to Panchayats at a Glance
Article No. Subject-matter
243. Definitions
243A. Gram Sabha
243C. Composition of panchayats
243D. Reservation of seats
243E. Duration of panchayats, and so on
243F. Disqualifications for membership
243G. Powers, authority and responsibilities of panchayats
243H. Powers to impose taxes by, and funds of, the
panchayats
243-I. Constitution of finance commission to review financial
position
243J. Audit of accounts of panchayats
243K. Elections to the panchayats
243L. Application to union territories
243M. Part not to apply to certain areas
243N. Continuance of existing laws and panchayats
243-O. Bar to interference by courts in electoral matters
Table 38.3 Name of Panchayati Raj Institutions in the States (2019)8
Sl. No. State Panchayati Raj
Institutions
1. Andhra Pradesh 1. Gram Panchayats
2. Mandal Parishads
3. Zilla Parishads
2. Arunachal Pradesh 1. Gram Panchayats
2. Anchal Samities
3. Zilla Parishads
3. Assam 1. Goan Panchayats
2. Anchalic Panchayats
3. Zilla Parishads
4. Bihar 1. Village Panchayats
2. Panchayat Samities
3. Zilla Parishads
5. Chattisgarh 1. Gram Panchayats
2. Janpad Panchayats
3. Zilla Panchayats
6. Goa 1. Village Panchayats
2. Zilla Panchayats
7. Gujarat 1. Village Panchayats
2. Taluka Panchayats
3. District Panchayats
8. Haryana 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Parishads
9. Himachal Pradesh 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Panchayats
10. Jharkhand 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Panchayats
11. Karnataka 1. Gram Panchayats
2. Taluka Panchayats
3. Zilla Panchayats
12. Kerala 1. Village Panchayats
2. Block Panchayats
3. District Panchayats
13. Madhya Pradesh 1. Village Panchayats
2. Block Panchayats
3. District Panchayats
14. Maharashtra 1. Village Panchayats
2. Panchayat Samities
3. Zilla Parishads
15. Manipur 1. Gram Panchayats
2. Zilla Panchayats
16. Odisha 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Parishads
17. Punjab 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Parishads
18. Rajasthan 1. Gram Panchayats
2. Panchayat Samities
19. Sikkim 1. Gram Panchayats
2. Zilla Panchayats
20. Tamil Nadu 1. Village Panchayats
2. Panchayat Unions
3. District Panchayats
21. Telangana 1. Gram Panchayats
2. Mandal Parishads
3. Zilla Parishads
22. Tripura 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Panchayats
23. Uttar Pradesh 1. Gram Panchayats
2. Kshetra Panchayats
3. Zilla Panchayats
24. Uttarakhand 1. Gram Panchayats
2. Intermediate
Panchayats
3. District Panchayats
25. West Bengal 1. Gram Panchayats
2. Panchayat Samities
3. Zilla Parishads
Table 38.4 Milestones in the Evolution of Panchayati Raj9
I. Towards First Generation Panchayats
1948– Constituent Assembly debates on the role of Panchayati Raj
49 in Indian polity
1950 The Constitution of India comes into force on 26 January;
Directive Principles of State Policy mention village panchayats
as ‘units of self-government’ (Art 40)
1952 Community Development Programme starts on 2nd October
1957 Balvantrai Mehta Committee, appointed in January, submits
its report on 24 November
1958– Several state governments enact new Panchayat Acts
60 bringing in three-tier panchayat system
at Nagaur in Rajasthan on 2nd October Kerala District Council
Bill is introduced in Kerala Assembly; lapses after Assembly is
dissolved
1964– Decline of first generation Panchayati Raj Institutions
77
II. Growth and Decline of Second Generation Panchayats
1978 Panchayat elections are held in West Bengal on party basis
on 4th June–marking the beginning of second generation of
Panchayati Raj.
Ashok Mehta Committee on working of panchayats, appointed
on 12 December 1977, submits its report on 21 August
1983 Karnataka government enacts new PR Act
1984 Hanumantha Rao Committee on district level planning,
appointed by Planning Commission in September 1982,
submits its report in May
1985 Karnataka PR Act receives President’s assent in July; comes
into force on 14th August
1985 G.V.K. Rao Committee on administrative aspects of rural
development, appointed by Planning Commission on 25
March, submits its report in December
1986 Andhra Pradesh follows West Bengal and Karnataka
Panchayati Raj Model
1987 Karnataka holds panchayat elections in January
1990– Panchayats are dissolved and brought under administrators in
92 Karnataka
III. Constitutionalisation of Panchayati Raj
1986 L.M. Singhvi Committee submits its report on 27 November;
recommends constitutional status for panchayats
1988 Consultative Committee of Parliament appoints a sub-
committee under chairpersonship of P.K. Thungon to consider
Constitutional Amendment
1989 64th Constitutional Amendment Bill is introduced in Parliament
on 15 May; is defeated in Rajya Sabha on 15 October
1991 72nd (Panchayats) and 73rd (Municipalities) Amendment Bills
are introduced in Parliament; referred to the Parliament’s Joint
Select Committee in September
1992 Lok Sabha passes both the Bills on 22 December; Rajya
Sabha passes them on 23 December
1993 73rd Amendment Act, 1992 comes into force on 24 April
74th Amendment Act, 1992 comes into force on 1 June
1993– All state governments pass Conformity Acts between 30 May,
94 1993 and 23 April, 1994
1994 Madhya Pradesh holds panchayat elections under the 73rd
Amendment dispensation on 30 May
1996 Provisions of the Panchayats (Extension to the Scheduled
Areas) Act, 1996, extending 73rd Amendment Act to
Scheduled Areas, comes into force on 24 December.
Kerala launches People’s Plan Campaign on 16 August
2001 Bihar holds panchayat elections after 23 years (11–30 April)
2001 83rd Constitutional Amendment Act, 2000 amends Art. 243-M
to dispense with reservations for Scheduled Castes in
Arunachal Pradesh–paving way for panchayat elections in the
only state yet to hold them under the new dispensation
Table 38.5 Committees Related to Panchayati Raj (After
Constitutionalisation)
Sl. Name of the Committee Chairman Appointed Reported
No. in in
1. Task Force on Devolution Lalit Mathur 2001 2001
of Powers and Functions
to Panchayati Raj
Institutions
2. Expert Group on V. 2005 2006
Planning at the Ramachandran
Grassroots Level
3. Task Force for Smt. Rajwant 2008 2008
Preparation of a Manual Sandhu
4. Committee on V. 2010 2012
Restructuring of DRDA Ramachandran
(District Rural