15. Local Government

polity study materials 15

Evolution of Urban Local Government In India:

The Pre-Independence Period: 

  • The roots of municipal administration in India can be traced to 1687, when a Municipal Corporation was set up at Madras with a view to transfer the financial burden of local administration to the local city council.
  • In 1850, an Act was passed for the whole of British India permitting the formation of local committees to make better provisions for public health.
  • Lord Mayo’s resolution of 1870 made arrangements for strengthening the municipal institutions and increasing the association of Indians in these bodies. Yet, it was Lord Ripon’s Resolution of 18 May 1882 that was hailed as the Magna Carta of local government and got for Lord Ripon the title of “father of local self-government in India.”
  • In India, Rippon’s Resolutions of 1881 and 1882 can be taken to be the origin of modern local government in India.
  • Ripon suggested reforms for instilling life into the local bodies. He advocated the establishment of a network of local self-governing institutions, financial decentralization, the adoption of election as a means of constituting local bodies and the reduction of the official element to not more than a third of the total membership. The Royal Commission on Decentralisation (1907) examined the reasons behind the failure of local self-governing bodies and concluded that it was due to strict official control, excessive narrow franchise, meagre resources, lack of education and shortage of committed persons. It suggested that the chairman of an urban body should be an elected non-official and that he should be given wider financial powers and the elected non-official members should comprise a majority in these bodies.
  • The Government of India Act 1919, introduced the system of dyarchy and the local self-government became a transferred subject under the charge of a popular minister of the provincial legislature. The Act increased the taxation powers of local bodies, lowered the franchise, reduced the nominated element and extended the communal electorate to a later number of municipalities.
  • This experiment was a success as well as a failure. It was a success because the local bodies became popular bodies and they imparted a certain amount of political education to the people.
  • It was a failure because communal representation dampened the spirit of unity, the system of dyarchy was very confusing and the municipal personnel were untrained. Lastly, the Government of India Act 1935, which emphasized provincial autonomy, again declared local government as a provincial subject. The Act earmarked no taxes

The main recommendations of the Mehta Committee were:

  • for local bodies. The municipal institutions were to be revitalised with the induction of popular ministries. However, due to the outbreak of World War II, little progress could be made in this direction.

The Post – Independence Period:

  1.  The Constitution of India, which came into force on 26 January 1950, directs the state through Article 40 to organize panchayats but does not give a corresponding duty to the state with regard to the creation of urban bodies.
  2. The only reference to urban self-government is to be found in two entries:
  • (1) Entry 5 of List 11 of the Seventh Schedule, , the State List says: “Local Government, that is to say, the constitution and powers of Municipal Corporations, Improvement Trusts, District Board, mining settlement authorities and other local authorities for the purpose of local self-government or village administration”.
  • (2) Entry 20 of the Concurrent List reads: “Economic and Social Planning, Urban Planning would fall within the ambit of both Entry 5 of the State List and Entry 20 of the Concurrent List.”
  • The quest for the revival of villages in free India was supported by the several innovations aimed at institution-building. The first such experiment was the Community Development Programme (CDP) inaugurated on 2 October 1952.
  • The CDP created an infrastructure for local governance and set up an entirely new unit called the CD block, each of which was headed by a Block Development Officer. It brought in several schemes for the socio-economic upliftment of the villagers.
  • The reliance was on government schemes supported with people’s participation. This, the CDP aimed at “Retention or revival of the Rurality which was taken for granted not only as a hallmark of village life in India but almost as the source of cultural continuity of the Indian civilization”.
  • The second experiment was the National Extension Service (NES) launched in 1953. NES blocks were carved out as the lowest administrative and development units, each comprising 300 villages and functioning under the supervision of a Block Development Officer. Besides, Extension Officers were posted in the blocks to provide technical guidance to farmers and small entrepreneurs.
  • Though both the programmes were initiated with great expectations, they failed to achieve the desired results. It met with only partial success in creating a truly decentralized system of development administration.
  • Anxious to redress this imbalance, the Government of India appointed on 16 January 1957, a committee, under the chairmanship of Shri Balwantray Mehta, to examine the working of the CDP and the NES and to report on the creation of institutions through which the participation of the rural population could be elicited. The committee submitted its report to the National Development Council on 24 November 1957.
  1. The philosophy underlined in the report was to move the decision-making centres closer to the people. A three-tier system of panchayati raj from the village to the district level with multi- level linkages, be created. The institutions envisaged were zila parishad at the district level, panchayat samiti at the block level and gram panchayat at the village level.
  2. There should be genuine transfer of power to these institutions.
  3. Adequate resources should be transferred to these bodies.
  4. All developmental schemes at these levels should be channelled through these PR institutions.
  • The Union, as well as state governments, welcomed the scheme of decentralization of governance, particularly for strengthening development administration. Soon, the process of adoption of the scheme started at the state level.
  • Panchayati raj was launched on 2 October 1959, Mahatma Gandhi’s birthday, in Nagaur district in Rajasthan. Andhra Pradesh followed suit the same year.
  • Thereafter, a majority of the states passed the necessary legislation to set up the PRIs.
  • However, by mid-1960s, it started losing its appeal for reasons such as the increasing tendency towards centralisation in the state governments and even the Central government, lack of resources with the panchayat, corruption and inefficiency in the working of PRIs and repeated postponement of elections to these bodies.
  • In 1977, the Janata Government, with a view to exploring the possibilities of reviving and strengthening panchayati raj, appointed the Asoka Mehta Committee, which reported in 1978.

The Asoka Mehta committee offered the following recommendations for strengthening the PRIs:

  1. Creation of a two-tier system of panchayats raj, with zila parishad at the district level and, below it, the mandal panchayat consisting of a number of villages having a population of 15,000 to 20,000,
  2. Nyaya panchayat, presided over by a qualified judge, to be kept as a separate body,
  3. Open participation of political parties in PRIs through elections contested on a party basis,
  4. PRI elections to be organised by the Chief Electoral Officer of the state in consultation with the Chief Election Commissioner,
  5. Zila parishad to be made responsible for planning at the district level
  6. Reducing the dependence of PRIs on state funds and, instead, endowing them with powers of taxation,
  7. Development functions to be transferred to zila parishads,
  8. State government not to supersede the PRIs on partisan grounds and
  9. Appointing in the state council of ministers, a minister for panchayats raj, to look after the affairs of the PRIs.
  • Due to the collapse of the Janata Government in 1980, no progress could be registered in the direction of implementing the Asoka Mehta Committee report. Another committee, known as the Committee on Administrative Arrangements for Rural Development (CAARD), was set up under the chairmanship of V.K. Rao in 1985.
  • The report of the Working Group on District Planning set up under the chairmanship   of H. Hanumantha Rao (1984) which advocated separate district planning bodies under either a minister or the Collector with a major role for the latter in the decentralised planning, though PR bodies would also be associated with the process. In 1986, the M. Singhvi Committee of the Department of Rural Development, Government of India, recommended constitutional status for panchayat raj. It also emphasized the importance of the gram sabha with a reorganization of villages and suggested the creation of nyaya panchayats, which already existed in some states like Rajasthan, for clusters of villages.
  • The 64th amendment introduced in the Parliament in July 1989 by the government of
  • Rajiv Gandhi. However, the bill could not be passed in the Rajya Sabha. Though passed in the Lok Sabha, the bill was defeated in the Rajya Sabha in October 1989. Most of the provisions of 64th Constitutional Amendment Bill 1989 were later incorporated in the 73rd Constitutional Amendment, except the powers proposed for the Governor or the Central government in the 64th Amendment Bill, which had been given to the legislature in the 1992 amendment.
  • In June 1990, under the chairmanship of Prime Minister V.P. Singh, a conference of the state chief ministers was organised to discuss reforms in the panchayati raj On the basis of the suggestions received, the cabinet formulated the 74th Constitution Amendment Bill, which was introduced in the Lok Sabha in September 1990.
  • However, due to the political upheaval that followed, the amendment could not get through.
  • The Congress Government, which took charge in June 1991, modified the amendment drastically and reintroduced it in the Parliament in the shape of the 73rd It was passed by the Lok Sabha on 6 December 1992 and by the Rajya Sabha on 23 December 1992.
  • The amendment came into force on 24 April 1993, on which date, all provision in various state acts that were repugnant to the provisions of the constitutional amendment ceased to remain in force. Many states had, by then, amended their own acts.

The 73rd Constitutional Amendment act 1992

  • The main provisions of the 73 rd Constitutional Amendment can be grouped under two categories: Compulsory and Voluntary.

I. Compulsory Provisions:

These are specifically provided for through the Constitution. They are

  • Organisation of gram sabhas,
  • Creation of a three-tier panchati raj structure at the zila, block and village levels,
  • All posts at all levels (with two exceptions) to be filled by direct elections,
  • The minimum age for contesting elections to PRIs to be 21 years,
  • Indirect elections to the post of chairman at the intermediate and apex tiers,
  • Reservation of seats for SC/ST, in panchayats (chairman and members), in proportion to their population,
  • Reservation for women, in panchayats (chairman and members) up to 1/3 rd seats,
  • Creation of a State Elections Commission to conduct elections to PRIs,
  • Tenure of PRIs fixed at five years and, if dissolved earlier, fresh elections to be held within six months, and
  • In order to review the financial position of the PRIs, each state to set up a State Finance Commission every five years.

II.       Voluntary Provisions:

 The implementation of voluntary provisions has been left to the will of the state. They are:

  1. Giving voting rights to members of the Union and state legislatures in these bodies,
  2. Providing reservation for backward classes,
  3. Giving the PRIs financial powers in relation to taxes, levy, fees etc.,
  4. Making the panchayat autonomous bodies, and
  5. Devolution of powers to the panchayat bodies to perform some or all of the functions suggested in the Eleventh Schedule added to the Constitution through the 73rd Amendment, and/or to prepare plans for economic development.

gram sabha :

  • The Balwantray Mehta Committee report which envisaged a three-tier structure at the local level, made no formal mention of the gram sabha.
  • Despite the omission, the gram sabha exists as a statutory body in almost all the states, except in Kerala and Tamil Nadu.
  • In states like Bihar, Orissa and Rajasthan, all the adult residents of a village or a group of villages are its members. In others, it consists of all the voters in the area, i.e. persons whose names appear on the electoral rolls for the state legislative
  • assembly. It is thus a body consisting of the people themselves rather than their representatives.
  • The membership of a gram sabha ranges from 250 to 5000. It generally meets twice a year, soon after the rabi and the Kharif
  • The gram sabha elects from among its members an executive committee which is generally known as the Besides, it elects the sarpanch and deputy sarpanch of the village panchayat. The sarpanch presides over the meetings of the gram sabha.
  • Before, it are placed the budget, plans and programmes, audit reports and progress reports relating to the activities undertaken by the
  • The 73rd Amendment to the Constitution seeks to rectify the existing lacunae in the
  • gram sabha. Most importantly, it gives a constitutional status to this grassroot institution.
  • Under the new provisions, two meetings of the sabha must be called compulsorily and, in case this is not done, the post of the sarpanch will be declared vacant. Now the Constitution fixes a quorum for the meetings of the gram sabha at 1/10 of the total members.
  • The panchayat Secretary will be the secretary of the sabha as well.
  • The budget and programmes of the panchayat will now be framed, keeping in view the suggestions of the All public problems of the village will be discussed in the sabha and, if need be, explanations on these can be demanded from the sarpanch. The beneficiaries of the various government welfare programmes would continue to be identified in the meetings of the sabha. Besides, it would assist the panchayat of its area in the execution of various rural development schemes.

gram panchayat:

  •  The panchayat is the executive committee of the gram sabha. A panchayat generally caters to a population of about 2,000. Thus, there could be one panchayat for a village or a group of small-sized villages.
  • The Administrative Reforms Commission had recommended that, as a general rule, there should be a panchayat for each village. This recommendation, however, has yet to be implemented by the states.
  • The tenure of a panchayats until recently, ranged from three to five years, but the 73rd Amendment fixes its tenure uniformly at five years. The members of the
  • panchayat are called panchas and, in most of the states, they are elected by the gram sabha by secret ballot.
  • For purposes of election the entire gram sabha area is divided into wards, with each ward electing one The membership varies between five and thirty-one. The 73rd Amendment fixes the age limit for contesting these elections at 21 years in place of the earlier limit of 25 years.
  • It has been laid down that each state will set up its own independent State Election Commission for holding the panchayat The Commissioner of this Commission will be appointed by the Governor of the state.
  • If the panchayat is dissolved before the expiry of the fixed term, fresh elections have to be held within a period of six months. Generally, in all the states seats are reserved for SC/ST and women.
  • The 73rd Amendment states that 1/3rd of the panchas in each panchayat would be
  • women. Wards for women would be reserved from which only women candidates can stand for election. Yet, they can also contest from male wards. The panchayat is expected to meet once in 15 days.
  • The presiding officer of the panchayat is known as the sarpanch in most of the states. Below him is the
  • The panchayat have wide ranging functions to perform . Some of them are: construction of public wells, supply of drinking water, maintenance of streets, rural electrification, sanitation, development of agriculture, promotion of cottage industries, prevention of fires, promotion of cooperatives, improvement of cattle, help in census operations, promotion of social education, control over offensive trades, regulation of shops and buildings, maintenance of panchayat property, organising voluntary labour, distribution of improved seeds, management of public markets, collection of statistics etc. For administrative convenience and discharge of these functions, committees of the panchayats can also be set up.

panchayat samiti:

  •  The panchayat Samiti represents the intermediate level in the panchayat raj It functions at the block level. There have been a number of variations of this institution in various states.
  • Until recently, the tenure of a panchayat samiti varied from three to five years in the various states of the country.
  • Each district is divided into several blocks and each block has one panchayat samiti. So far, there has not been complete congruence between the territorial areas of revenue and developmental administration.
  • Such congruence, however, would be ideal for rationalizing the regional and the local administration. It is in this perspective that the Administrative Reforms Commission had recommended that the areas covered by the block should be so redemarcated that the territorial unit of development administration would correspond to a tehsil or subdivision.
  • The pattern of composition of panchayat samities has differed from state to state, though, normally, its membership has ranged from 15 to 20 It is composed of ex- officio members (all sarpanchas of the panchayat samiti area, the MPs and MLAs of the SC/ST and women), associate members (a farmer of the area, a representative of the cooperative societies and one of the marketing services) and some elected members. The BDO has been the secretary, as also the executive officer of the samiti. He has been functioning with the help of several extension officers.
  • The enactment of the 73rd Constitutional Amendment, the chairman of a panchayat
  • samiti is called the pradhan in some states. Below him is the The pradhan can be removed from office by a no confidence motion of the panchayat samiti.

The functions of a panchayat samiti can be classified into two parts :

  1. a) Functions normally entrusted to the panchayat samiti which include supply of drinking water, drainage, construction of roads, establishment of youth organizations, encouragement to cultural activities and provision of health services, and
  2. b) Development functions, which include execution of development programmes entrusted to it, distribution of improved seeds and fertilizers, conservation of soil, providing credit for agricultural purposes, providing irrigation facilities, improvement of forests, improvement of cattle and fodder, development of cottage and small scale industries and opening of cooperative societies. For the efficient discharge of these duties, a panchayat samiti can set up functional committees.

zila praishad:

  •  A zila parishad is the apex body in the system of democratic decentralization. In certain states, it has its counterparts under different names.
  • A zila parishad comprised the presidents of all the panchayat samities in the district, all members of the Union and state legislatures of that area (including members and some associate members such as the chairman of the cooperative bank of the areas. As the zila parishad consisted of members, mostly in their ex-officio capacity, their tenure depended on their substantive tenure. The term of the other members varied from three to five years. However, as per the 73rd Amendment, all the members of the zila parishad are elected directly by the people and its tenure is five years.
  • The salient functions of a zila parishad, so far, have been as follows: a) examine and approve the budget of panchayat samities for efficient performance of their duties, c) coordinate the development plans prepared by the panchayat samities d) advise the state government on all matters relating to development activities in the district, e) distribute funds allocated by the state to various panchayat samities, f) inform the Divisional Commissioner and the District Collector about irregularities in PRIs g) coordinate the work of the various panchayat samities and h) advise the state government on the allocation of work to be made among the PRIs.

Urban Local Government:

 The Constitution 65th Amendment Bill, 1989

  •  The Constitution 65th Amendment Bill brought by the then Prime Minister, Rajiv Gandhi, sought to ensure municipal bodies being vested with necessary powers and removing their financial constraints to enable them to function effectively as units of local government.
  • Three types of Nagar Palikas were envisaged; Nagar Panchayat for a population between 10,000 and 20,000; Municipal Council for urban areas with a population between 20,000 and 3, 00,000 and Municipal Corporation for urban areas with a population exceeding 3, 00,000.
  • It made provisions for elected Ward Committees, adequate representation for women and SC/ST in the urban bodies, conduct of elections by the Central Election Commission, setting up Finance Commissions in the states to ensure soundness of
  • local body finances, audit of accounts by the Comptroller and Auditor General of India and creation of district level committees to co-ordinate the plans of Nagar Palikas and Panchayats. It also envisaged granting of urban bodies with a constitutional status.
  • Though passed in the Lok Sabha, the bill was defeated in the Rajya Sabha in October 1989.

The Constitution 74th Amendment Act:

  •  With the assumption of power by the National Front Government in December 1989, the provisions of the Constitution 65th Amendment Bill 1989 were reviewed.
  • A revised Amendment Bill, incorporating the provisions relating to Panchayats as well as municipalities, was introduced in the Lok Sabha in September, 1990. This bill also lapsed on account of dissolution of the then Lok Sabha.
  • When the Narasimha Rao government took charge in 1991, it introduced a Constitution Amendment Bill pertaining to municipalities in the Lok Sabha on 16 September 1991. With a few modifications, it was essentially based on the 65th Amendment Bill. It was passed by both the House in December 1992.
  • The bill has since been ratified by a resolution of at least half the number of state legislatures. It received the assent of the President on 20 April 1993 and was published in the gazette on the same day as the Constitution 74th Amendment Act, 1992.
  • The Act introduces a new part, namely, Part IXA, in the Constitution. This part deals with issues relating to municipalities such as their structure and composition, reservation of seats, elections, powers and functions, finances, and some miscellaneous provisions.
  • The 74th Amendment Act thus gives a constitutional status to the municipalities. The
  • provisions of the Act apply to the states as well as the union territories. However, in relation to the later, the President can make certain reservations and modifications. The provisions do not apply to the Scheduled Areas and Tribal Areas governed by Article 244 (1) and (2) of the Constitution.
  • All elected bodies in municipalities existing immediately before the commencement of the Act, shall continue till the expiry of their elected duration, unless they are dissolved earlier by the state legislature. In order to provide time to allow changes to be made in the existing laws which are inconsistent with the provisions of the 74th Amendment Act, a transition period of one year was allowed.

Structure and Functioning:

  1. In India, for the administration of urban areas, several types of municipal bodies are created for the towns and cities, depending on their size, population, industrial or other importance etc. These bodies are:
  • Municipal Corporation
  • Municipal Council/Committee/Municipality Notified Area Committee
  • Town Area Committee Township
  • Cantonment Board, and Special Purpose Agency/Authority

2, These local bodies do not exist in all the states and union territories strictly in order of hierarchy. Similarly, several other variations regarding these bodies may exist.

Municipal Corporation:

  •  Municipal Corporations are set up only in big cities. The 74 th Amendment Act provides that the areas for different types of urban bodies would be specified by the Governor of the state, taking into account the population, density of the population therein, revenue generated by the local body, percentage of employment in non- agricultural activities, and other factors.
  • A municipal corporation has a statutory status as it is created by an Act of the state legislature or of the Parliament in case of a union territory.
  • The municipal corporation is a popular body that provides representation to local people. Most of its members are directly elected on the basis of adult franchise. It does not have a sovereign status or inherent powers.
  • It exercises only those functions which are allocated to it by the state government. An important feature of a corporation is that there is a statutory separation of the legislative (or the deliberative) wing and the executive wing.
  • The council of a corporation is headed by the Mayor and its standing committees constitute the deliberative wing which takes decisions. The Municipal Commissioner is the executive authority, responsible for enforcing these decisions. Collectively, the council, headed by the Mayor, the standing committees and the Municipal Commissioner make up the corporation.
  • The council of the corporation consists of councillors who function for a period of five years. The composition of the municipal bodies has also undergone a change after the Constitution 74th Amendment Act.
  • It lays down that all the seats shall be filled by direct elections for which the municipal area would be divided into wards. Each seat shall represent a ward in the municipality. Apart from the seats filled by direct elections, some seats may be filled
  • by nominations of persons having special knowledge or experience of municipal administration, but such members would not enjoy any voting right.
  • Besides the members of Parliament and of the state legislature will also be voting members in a municipality. The Act also gives details regarding the reservation of seats for SC/ST, women and backward classes.
  • The proportion of seats to be reserved for SC/ST to the total number of seats shall be the same as the proportion of the population of SC/ST in the municipal area to the total population of that area. Not less than one-third of the total number of seats reserved for SC/ST shall be reserved for women belonging to SC/ST. Not less than one-third of the total seats in the municipal body will be reserved for women. (This is inclusive of the seats to be reserved for women belonging to SC/ST).
  • An optional provision for a state legislature is that it can make reservations for backward classes also. The state law is also expected to provide for adequate representation of SC/ST sand women in relation to the office of chairperson of the municipality.
  • The Constitution 74th Amendment Act does not specify the manner and procedure of
  • election of the chairperson. It has been left to the state legislature. It may either be by direct elections or from amongst the elected members of the municipality concerned.


 The list of functions that has been laid down in the Twelfth Schedule is as follows

  1. Urban planning, including town planning.
  2. Regulation of land use and construction of buildings
  3. Planning for economic and social development
  4. Roads and bridges.
  5. Water supply for domestic, industrial and commercial purposes
  6. Public health, sanitation, conservancy and solid waste management.
  7. Fire services.
  8. Urban forestry, protection of the environment and promotion of ecological aspects.
  9. Safeguarding the interests of weaker sections of society, including the handicapped and the mentally retarded.
  10. Slum improvement and upgradation.
  11. Urban poverty alleviation.
  12. Provision of urban amenities and facilities such as parks, gardens, playgrounds.
  13. Promotion of cultural, educational and aesthetic aspects.
  14. Burials and burial grounds; cremations, cremation grounds and electric crematoriums.
  15. Cattle ponds; prevention of cruelty to animals.
  16. Vital statistics including registration of births and deaths.
  17. Public amenities, including street lighting, parking lots, bus-stops and public conveniences.
  18. Regulation of slaughter houses and tanneries.

Municipal Council/Committee/Municipality:

  •  A municipal council is a statutory body created by an Act of the state legislature and
  • the criteria for setting it up vary from state to state. Broadly, these are: population, size, sources of income, industrial/commercial future and prospects of the city.
  • A city which is industrially advanced may have a municipality despite its low population. The size of a municipality is determined by the state government, but the minimum number of councillors should be five. The size increases with the increases in population. Their tenure, under the Constitution 74th Amendment Act, 1992, is five years.
  • A municipal council consists of elected, co-opted and associated members. For the elected seats, elections are held on the basis of adult suffrage and secret ballot and for which purpose, the city is divided into wards. Seats are reserved for SC/ST, women and backward classes. Nominated members and members with voting rights are the same as for the municipal corporation.
  • In order to lessen work load of the council, several sub-committees are set up such as the Ward Committee to manage the affairs of a ward and committees dealing with subjects like buildings, vehicles, works, finance, lease etc.
  • The municipal council elects, from amongst its members, a President for a period of five years. He can be removed by the council as well as by the state government. The council also elects one or two Vice-Presidents-one senior and one junior – who are removable by the council itself.
  • The President plays a pivotal role in municipal administration and enjoys real deliberative and executive powers. He presides over the meetings of the council, guides the deliberations and gets the decisions implemented.
  • He is the administrative head of all the officers of the municipality, is the custodian of municipal records, approves all financial matters before they are placed in the council and represents the council on national and social occasions.
  • He enjoys special extraordinary powers, under which he can order the immediate execution or suspension of any work. The state government also appoints an Executive Officer in the municipal council for the conduct of general administrative work.
  • He exercises general control and supervision over the municipal office, can transfer clerical employees, prepares the municipal budget, keeps an eye on expenditure, is responsible for the collection of taxes and fees and takes measures for recovering municipal arrears and dues.
  • He can be removed by the council or by the state government.

Some other Provisions of the 74th Constitution Amendment Act:

  •  The Act also provides for setting up Nagar Panchayats. They are existing in some states already. A Nagar Panchayat will be constituted for a transitional area. Such an area is basically rural in character, which over a period of time, is likely to develop urban characteristics. Hence, this urban local body would have to perform both rural and urban functions.
  • Each state/UT will have to constitute a State Election Commission (SEC), headed by a State Election Commissioner appointed by the Governor of the state. The superintendence, direction and control of the preparation of the electoral rolls for, and the conduct of, all elections to the Panchayats and municipalities shall be vested in the SEC. Already, several states have appointed such commissions.
  • In order that the financial position of the municipalities is reviewed periodically, it has been laid down that a State Finance Commission (SFC) will have to be constituted by the Governor of the state within one year from the commencement of the Constitution 74th Amendment Act, and thereafter, at the expiry of every five years.
  • The composition, qualifications and manner of appointment of the members of the SFC will be determined by the state legislature. It will make recommendations to the Governor, who will lay them before the state legislature.
  • The recommendations will broadly cover the following areas: distribution of income between the state government and municipalities, determination of taxes, duties, tolls and fees to be assigned or appropriated to the municipalities, grants-in-aid to municipalities from the Consolidated Fund of the state, measures needed to improve the financial position of the municipalities and allocation of the shares of such proceeds between the municipalities at all levels in a state.
  • The Act also provides for setting up of ward committees in order to provide the citizens ready access to their elected representatives. The composition, territorial jurisdiction and the manner in which seats in ward committees shall be filled has been left to the state legislature to be specified by law.

Notified Area Committee (NAC):

  •  The Notified Area Committee is set up for an area which does not yet fulfil all the conditions necessary for the constitution of a municipality but which the state government otherwise considers important.
  • Generally, it is created in an area which is fast developing and where new industries are being set up. It is not created by statute but by a notification in the government gazette and, hence, the name ‘notified area’.
  • The state government constitutes a committee called the Notified Area Committee (NAC) to administer this area. All the members of this committee are nominated by the state government and there are no elected members. Its Chairman is also appointed by the state government. The criteria for establishing this committee differ from state to state.
  • As all the members of the NAC are appointed by the government, it is clearly a violation of the democratic principle. In a number of states, there are demands for abolishing these committees and setting up municipalities in their place so that the local people can solve their problems themselves.

Town Area Committee (TAC):

  • It is a semi-municipal authority, constituted for small towns. The Town Area Committee (TAC) is constituted and governed by an act of the state legislature and its composition and functions are specified in it.
  • Its membership differs from state to state. The committee may be partly elected, partly nominated or wholly elected or wholly nominated. The committee is assigned a limited number of functions such as street lighting, drainage, roads, conservancy etc.
  • The District Collector, in some states, has been given control and powers of surveillance over a TAC.
  • Following the recommendations of the Rural Urban Relationship Committee (1966) that the smaller TACs be merged with the Panchayat Raj bodies, lately, Madhya Pradesh and Haryana have merged their TACs with Panchayati Raj institution


  •  Several large-sized public enterprises have been set up in India. A few examples are: the steel plants at Rourkela, Bhilai and Jamshedpur, Heavy Electrical Limited near Bhopal and Hindustan Aeronautics near Bangalore.
  • Near the plants, housing colonies have been built for the staff and workers. Since these industries are a source of employment, people from urban as well as rural areas are drawn to them and, resultantly, small townships evolve around them.
  • These townships are administered by the Municipal Corporation or council within whose boundary they fall. For administering them, the corporation or council appoints a Town Administrator, who is assisted by a few engineers and technicians. The townships are well parks etc. The expenditure on these services is shared by the industry concerned. The facilities existing in the townships are generally of a high standard.

Single Purpose Agencies

  •  These agencies are set up as government departments or as statutory bodies under separate Acts of the state government. Some such agencies are housing boards, pollution control boards and water supply and sewerage boards.
  • Such bodies are set up, even though other municipal agencies exist for the same area, since there are certain activities which require expertise, concentrate attention and special skills which the municipal bodies do not possess.

Cantonment Board

  •  This form of urban local government is also a British legacy. Cantonment boards were first set up under the Cantonments Act in 1924. While all other institutions of urban governance are administered by the state government, these are the only bodies which are centrally administered by the Defence Ministry.
  • When a military station is established in areas, the military personnel move in and, to provide them with facilities of everyday life, a sizeable civilian population also joins the developing area. Soon, colonies, markets etc., develop near such military stations. For administering these areas, cantonment boards are created.
  • As of 1987, there were 63 cantonment boards in India which were grouped into three classes:

      1) Class I cantonment in which the civilian population exceeds 10,000

      2) Class II cantonment in which the civilian population is between 2,500 and                  10,000 and

     3) Class III cantonment in which the civilian population is less than 2,500.

  • The board consists of both elected and nominated members. The officer commanding the station is the President of the board. An elected member holds office for three years, while the nominated members continue as long as they hold the office in that station.

Housing Boards 

  • Almost all the states have set up housing boards to deal with problems relating to housing. The Constitution of housing boards varies from state to state.
  • Broadly, however, a housing board at the state level is headed by a chairman, who is either a serving civil servant or a citizen from public life.
  • On the board are representatives of the state departments of finance, industry, education, health, labour and local self-government. Other members are the Chief Town Planner, the Mayor or the Municipal Commissioner and some citizens, including members of the Central and state legislatures.

Planning for Urban and Rural Local Governments

  •  Planning and allocation of resources at the district level, for the Panchayati Raj institutions, are normally to be done by the Zila Parishad, and in the urban areas, the municipal bodies discharge these functions within their jurisdiction.
  • However the need to take an overall view with regard to development of the district as a whole and decide on allocations of investments between the urban and rural institutions was constantly felt.
  • The Constitution 75th Amendment Act makes provision for the Constitution of a
  • planning committee at the district level with a view to consolidate the plans prepared by the Panchayats and the municipalities and prepare a development plan for the district as a whole.

The District Planning Committee (DPC)

  •  In order to impart a democratic character to such committee, it is laid down that not less than four-fifths of the total number of members of these committees should be elected from amongst the members of the panchayats at the district level and of the municipalities in the district in proportion to the ratio between the urban and the rural populations in the district. All other details, regarding the composition, have been left to the state legislatures.
  • The DPC, in preparing the Draft Development Plan, shall have regard to:
  1. Matters of common interest between the panchayats and the municipalities including spatial planning;
  2. Sharing of water and other physical and natural resources;
  3. Integrated development of infrastructure and environment conservation; and
  4. Extent and type of available resources, whether financial or otherwise.
  • The plan so prepared by the DPC is to be sent to the state government by the chairperson of the committee.

Metropolitan Planning Committee (MPC):

  •  As of 1993, there were 23 metropolitan agglomerations in the country. Where the metropolitan area encompassed not only the main city corporation but also a number of other local bodies – both urban and rural – surrounding the main city corporation. In order to ensure orderly development of the urbanising fringe areas, proper development plants of the surrounding towns and villages need to be drawn up in association with the plan of the main city. Besides, their development schemes have also to be coordinated.
  • The Constitution 74th Amendment provides that in every metropolitan area (with a
  • population of 10 lakh or more), a Metropolitan Planning Committee is to be constituted for preparing draft development plan for the metropolitan area as whole.

While preparing the Draft Development Plan, the MPC will take account of the following factors:

  • Plans prepared by the municipalities and the panchayats in the metropolitan areas; Matters of common interest between the two, including coordinated spatial plans of the areas;
  • Sharing of water and other physical and natural resources;
  • Integrated development of infrastructure and environment conservation; Overall objectives and priorities set by the Government of India and the state government;
  • Other available resources, financial and otherwise.
  • The draft so prepared by the MPC will be forwarded by the chairperson of the committee to the state government. Now, we move on to certain problems faced urban bodies.



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