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Q80 (IAS/2002) Polity & Governance › Constitutional & Statutory Bodies › Finance Commission of India Answer Verified

Which one of the following authorities recommends the principles governing the grants-in-aid of the revenues to the states out of the Consolidated Fund of India?

Result
Your answer: —  ·  Correct: A
Explanation

Article 280 of the Constitution creates the Finance Commission and assigns it a statutory mandate to advise the President on tax sharing and grants. Textbook summaries of the Finance Commission’s functions explicitly state that it must recommend “the principles that should govern the grants‑in‑aid to the states by the Centre (i.e., out of the Consolidated Fund of India)” as part of its core remit to the President [1]. Official Finance Commission reports and their Terms of Reference likewise treat grants‑in‑aid as a principal area of recommendation, detailing principles and the sums to be paid to states in need under Article 275 and related provisions [2]. Hence, the Finance Commission is the authority that recommends those principles.

Sources

  1. [1] Indian Polity, M. Laxmikanth(7th ed.) > Chapter 46: Finance Commission > FUNCTIONS > p. 431
  2. [2] https://fincomindia.nic.in/asset/doc/commission-reports/13th-FC/english/Chapter12.pdf
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SIMILAR QUESTIONS

CAPF · 2010 · Q74 Relevance score: 6.34

Statement I : The Finance Commission makes principles which govern the grants-in- aid of revenues given to the States out of the Consolidated Fund of India. Statement II Members of the Finance Commission are drawn from all the States and Union Territories.

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Consider the following statements: The State government shall appoint a fincance commission to review the financial position of the Panchayats and to make recommendations as to 1. the distribution between the State and Panchayats of the net proceeds of taxes, tolls and fees leviable by the states. 2. the determinates of the taxes duteis, tolls and fees which may be assigned to the panchayats. 3. the principles that will determine grant-in- aid to the Panchayats. Which of the statement(s) given above is/are correct?

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