HSS F362: Local Governance and

Participation

Lecture 10

Mohan Kumar Bera

BITS Pilani Goa Campus
Panchayati Raj Bills, Acts and Constitutional amendments,
Grassroots politics

Urban Local Bodies (ULB)

 Introduction
• The 74th Amendment Act established a mandate for decentralizing
powers and authorities to Urban Local Bodies (ULB) at various levels.

• This amendment also aimed to create an institutional framework to let in

grassroots democracy through self-governing local bodies in urban areas
of the country.

• It also gave the ULBs, the power to exercise 18 functions listed in the 12th
Schedule of the Indian Constitution.
 Historical Background
• During the British regime, village panchayats lost their autonomy and became
weak.

• The Mayo Resolution of 1870 gave force to the development of local

institutions by expanding their powers and responsibilities. In the year 1870,
Mayo presented the notion of elected officials in urban municipalities.

• Following this, Lord Rippon in 1882 provided the essential democratic

framework for these institutions.

• With the appointment of the Royal Commission on Centralization in 1907

under the chairmanship of C. Hobhouse gave a boost to the local self-
government institution.

• In the Post–Independence Period, after the Constitution came into power,

Article 40 mentions the panchayats, and Article 246 enables the state
lawmaking body to enact any subject identifying with local self-government.
 Historical Background
• After independence, India implemented Community Development Programs
(CDP) as a development initiative.
•
• In 1957, the National Development Council set up an advisory group headed by
Balwant Rai Mehta to audit the working of the Community Development
Program.

• Balwant Rai Mehta Committee proposed three-level PRIs, to be specific, Gram

Panchayats at the village level, Panchayat Samiti at the block level, and Zilla
Parishad at the district level. By this recommendation, democratic
decentralization was introduced in Rajasthan on October 2, 1959.

• The appointment of the Ashok Mehta Committee in 1977 did bring the ideas
and practices of Panchayat Raj. The Committee suggested a two-level Panchayat
Raj institutional design consisting of Zilla Parishad and Mandal Panchayat.
 Historical Background
• The G.V.K. Rao Committee (1985) suggested making the "district" the fundamental unit of
preparation and furthermore holding regular elections while the L.M.Singhvi Committee
suggested giving more financial resources and Constitutional status to the panchayats to
reinforce them.

• In 1989, the Rajiv Gandhi Government presented the 65th Constitutional Amendment Bill
(Nagarpalika bill) in the Lok Sabha. The bill pointed toward strengthening and revamping
the municipal bodies by giving Constitutional status to them.

• The bill was passed in the Lok Sabha, but not in the Rajya Sabha in October 1989 and,
hence, lapsed.

• The National Front government headed by V P Singh reintroduced the revised

Nagarpalika Bill to Lok Sabha in September 1990. However, the law was not passed and
eventually lapsed due to the dissolution of the Lok Sabha.

• PV Narasimha Rao's Government also introduced the Amended Municipalities Bill in Lok
Sabha in September 1991. It eventually became the 74th Constitutional Amendment Law
of 1992 and entered into force on June 1, 1993.
 Objectives - 74th Constitutional
Amendment Act

• The act granted municipalities constitutional status. It has

brought them under the purview of the Constitution's
justiciable provisions.

• In other words, state governments have a constitutional

obligation to implement the new municipal system in
accordance with the provisions of the act.

• The act's goal is to revitalize and strengthen municipal

governments so that they can function effectively as units of
local government.
Constitutional Provisions Constitutional Provisions –
74th Constitutional Amendment Act
• It was passed by Parliament in December 1992 and came into force on 1 June 1993
adding Part IX A (Articles 243-P to 243-ZG) and the 12th schedule in the
Constitution.

• The 74th amendment provided a uniform law for all the municipalities in the
nation.

• Articles and Provisions

– Article 243-Q mentions the Constitution of Municipalities i.e. Nagar Panchayat, Municipal
Council, and Municipal Corporation.

– Article 243R mentions the Composition of Municipalities. It states that all of its members
are directly elected by the people of the Municipal area which is divided into territorial
constituencies known as wards.

– Article 243 S mentions about constitution and composition of ward committees consisting
of wards and members of wards who represent that ward in the Municipality.
 Constitutional Provisions Constitutional
Provisions – 74th Constitutional Amendment Act
– Article 243 T deals with the reservation of seats in every Municipality.

– Article 243 U mentions the duration of Municipalities.

– Article 243 V mentions the grounds for disqualification of members of the

Municipality.

– Article 243W deals with the powers, authorities, and responsibilities of

municipalities that include urban planning, financial and social
development, and so on.

– Article 243X states that the constitution has left it open to the Legislature
of a State to specify by law matters relating to the imposition of taxes.
 Constitutional Provisions Constitutional
Provisions – 74th Constitutional Amendment Act

– Article 243 Y provides for the constitution of the Finance Commission

which will give its opinion on the distribution of finances between the
State and the municipality and will determine the aid subsidies.

– Article 243-ZA provides for the establishment of a State Election

Commission, independent of which the Election Commission of India,
conducts elections for every Municipal Corporation for a term of 5 years.

– Article 243 ZC says that provisions of part IXA are not applicable to
Scheduled Areas referred to in article 244. These include Assam,
Meghalaya, Tripura, and Mizoram. It is also not applicable to the area
under Darjeeling Gorkha Hill Council.

– Article 243 ZE says that there will be a Metropolitan Planning Committee in

every Metropolitan region to set up a draft improvement plan for the
 Salient Features - 74th Constitutional
Amendment Act
• 1. Three Types of Municipalities
– The act provides for the constitution of the following three types of municipalities in every
state.

– A Nagar Panchayat (by whatever name called) for a transitional area.

– A municipal council for a smaller urban area.

– A municipal corporation for a larger urban area.

• However, there is one exception, If there is an urban area where municipal

services are being provided by an industrial establishment, then the governor
may specify that area to be an industrial township. In such a case, a
municipality may not be constituted.
 Salient Features - 74th Constitutional Amendment Act

• 2. Composition
– All the members of a municipality shall be elected directly by the people of the
municipal area.

– For this purpose, each municipal area shall be divided into territorial constituencies
to be known as wards.

– The state legislature may provide the manner of election of the chairperson of a
municipality.

• 3. Wards Committees
– A wards committee shall be constituted consisting of one or more wards, within the
territorial area of a municipality having a population of three lakh or more.
 Salient Features - 74th Constitutional Amendment Act

• 4. Other Committees

– In addition to the ward committees, the state legislature is also allowed to make any
provision for the constitution of other committees.

– The chairpersons of such committees may be made members of the municipality.

• 5. Reservation of Seats

– Reservation of seats for SC and ST is provided in every municipality in proportion to their

population.

– Provision for reservation of 1/3rd of the total number of seats is also provided for women.

– The state legislature has been empowered to make any provision for reservation in the
municipality at any level in favor of the backward class.
•
 Salient Features - 74th Constitutional Amendment Act

• 7. Disqualifications
• A person shall be disqualified on the following grounds:
– if he is disqualified under any law for the time being in force for the purposes of elections to
the legislature of the state concerned; or
– if he is disqualified under any law made by the state legislature.

• However, no person shall be disqualified on the ground that he is less than 25

years of age if he has attained the age of 21 years.

• 8. State Election Commission

– The State Election Commission has been constituted and has been endowed with various roles
like superintendence, direction and control of the preparation of electoral rolls.

– The conduct of elections to the Municipalities shall also be handled by the state election
commission.
 Salient Features - 74th Constitutional Amendment Act

• 9. Powers and Functions

• The powers and functions of the Municipalities are endowed by the state
legislature.

• The Municipalities prepare a plan for economic development and social

justice for the people of the Municipality.

• It implements the scheme of the Central and State government for the
betterment of the people at the ground level.

• Municipalities have the power to enhance employment facilities and

undertake development activities in the area.
 Salient Features - 74th Constitutional Amendment Act

• 10. Finances
• The state legislature may-
– authorize a panchayat to levy and collect taxes, duties, duties, and fees;

– assign to the Panchayat taxes, duties, duties, and fees levied and collected by the
state government;

• provide grants-in-aid to the Panchayats from the state's

consolidated fund, and provide for the establishment of funds to
credit all money of the Panchayats.
 Salient Features - 74th Constitutional Amendment Act

• Finance Commission

• The finance commission is constituted by the governor to review the financial position of
the Municipalities.

• This commission recommends the governor to decide on the principles that should
govern the distribution of taxes between the state and the Municipalities.

• It also determines the taxes, duties, tolls, and fees that may be assigned to
Municipalities.

• The provisions with respect to the maintenance of accounts by the Municipalities and the
auditing of such accounts are done according to the provisions decided by the state
legislature.

• Audit of Accounts

• State legislatures can make provisions regarding the maintenance and auditing of
 Salient Features - 74th Constitutional Amendment Act

• 11. Application to Union Territories

• The provisions of this Part apply to the territories of the Union. However, the
president may specify and direct any exception of modification as required.

• 12. Exempted Areas

• The act does not apply to scheduled areas and tribal areas in the following states.

– At present, ten states of India have scheduled areas - Andhra Pradesh, Telangana,
Jharkhand, Chhattisgarh, Gujarat, Himachal Pradesh, Madhya Pradesh, Maharashtra,
Orissa, and Rajasthan.

– Presently, there are a total of ten tribal areas (autonomous districts) in the four states of
Assam (3), Meghalaya (3), Tripura (1), and Mizoram (3).

• It shall also not affect the functions and powers of the Darjeeling Gorkha Hill
 Salient Features - 74th Constitutional Amendment Act

• 13. District Planning Committee

• Every state shall constitute at the district level, a district planning

committee to consolidate the plans prepared by panchayats and
municipalities in the district, and to prepare a draft development plan for
the district as a whole.

• The act lays down that 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.
 Salient Features - 74th Constitutional Amendment Act

• 14. Metropolitan Planning Committee

• Every metropolitan area shall have a metropolitan planning committee to

prepare a draft development plan.

• A Metropolitan area means an area having a population of 10 lakh or more, in

one or more districts, and consisting of two or more municipalities or
panchayats or other contiguous areas.

• The act lays down that 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.
 Salient Features - 74th Constitutional Amendment Act

• 15. Continuance of Existing Laws and Panchayats

• All state laws pertaining to municipalities shall remain in effect until one
year after the commencement of this act.

• In other words, states must implement the new municipality system based
on this act within a year of its enactment on April 24, 1993, the date of
the act's enactment.

• However, all municipalities that existed prior to the enactment of the act
will continue until the end of their terms, unless dissolved earlier by the
state legislature.
 Salient Features - 74th Constitutional Amendment Act

• 16. Bar to Interference by Courts in Electoral Matters

• The act prohibits courts from interfering in municipality elections.

• It declares that the constitutionality of any law relating to the delimitation

of constituencies or the allocation of seats to such constituencies cannot
be challenged in any court.

• It also states that no election to a municipality may be challenged unless

accompanied by an election petition filed with the appropriate authority
and in the manner prescribed by the state legislature.
 12th Schedule of the Constitution
The 12th Schedule of the Constitution enlists the following 19 functions as
belonging to the legitimate domain of the municipalities.

• Urban Planning including town planning

• Regulation of land-use and construction of buildings

• Planning for economic and social development

• Roads and bridges

• Water supply for domestic, industrial and commercial purpose

• Public health, sanitation, conservancy and solid waste management

• Fire services
 12th Schedule of the Constitution
• Urban forestry, protection of the environment and promotion of ecological
aspects

• Safeguarding the interests of weaker sections of society, including the

handicapped and the mentally retarded

• Slum improvement and upgradation

• Urban poverty alleviation

• Provision of urban amenities and facilities such as parks, gardens, playgrounds

• Promotion of cultural, educational and aesthetic aspects

• Burials and burial grounds, cremations, cremation ghats/grounds and electric

crematoria
 12th Schedule of the Constitution

• Cattle pounds; prevention of cruelty to animals

• Vital statistics including registration of births and deaths

• Public amenities including street lighting, parking lots, bus stops and public
conveniences

• Regulation of slaughter houses and tanneries

The 74th amendment has left the assignment of the above functions and
sources of finance commensurate with the responsibilities to the State
Governments by law.
 Significance of 74th Amendment Act
• Cities and towns make significant contributions to the nation's economic
growth.

• The growth of the rural hinterland is significantly aided by these urban centers.

• The people and their representatives must be fully involved in the planning and
implementation of the programmes at the local level in order to maintain this
economic change in line with requirements and realities at the grassroots level.

• The roots of democracy must extend into the towns, villages, and cities where
people live if it is to remain strong and stable in the Parliament and State
Legislatures.
 Evaluation
• At the point when we take the provisions of the Part IXA of our constitution, we can say
with certainty that the 74th amendment act 1992 is perhaps the most significant and
fundamental amendment so far concerning urban developments.

• The Act attempted to make local bodies efficient and transparent.

• The 74th amendment to the Constitution was intended to empower Urban Local
government with decision-making abilities, revenue generation, and financial
autonomy.

• As far as financial autonomy or independence, Urban Local governments have

unquestionably shown improvement over their rural counterparts, nonetheless, no
Indian city can in any case coordinate with any of the metros in developed nations even
following 25 years of underlying change.

• The implementation of the 74th CAA by the State Governments across the country has
not been done enough to implement it with few exceptions like Kerala and West
Bengal.
 Recent Remarks
• In 2018, NITI Aayog official said that even after the twenty-five years of
passing the 74th Constitutional Amendment Act, 1992 that aimed at
strengthening democracy at the grass root level through local bodies, only
11 states have managed to devolve municipal functions to Urban Local
Bodies.

• Before the hit of the second wave of the Covid pandemic, The 15th
Finance Commission had called out the need for decentralized primary
healthcare to be handled by local bodies, with the engagement of elected
councilors, communities, and resident welfare associations.
• The 74th Amendment to the Constitution marks a watershed
moment in India's evolution of local government.

• Municipalities and municipal corporations in urban India have

been granted constitutional status for the first time.

• The Nagar Palika Central Legislation, also known as the 74th CAA,
has dispersed hundreds of small local governments across India.

• The 74th CAA not only constitutionalized the status of urban

local government, but it also improved its life, structure, working,
and financial conditions.