ARTICLE
282. Expenditure defrayable by the
Union or a State out of its revenues.
268. Duties levied by the Union but collected and appropriated
by the States.-
(1) Such stamp duties and such duties of excise on medicinal and toilet
preparations as are mentioned in the Union List shall be levied by the Government of India
but shall be collected-
(a) in the case where such duties are leviable within any Union
territory, by the Government of India, and
(b) in other cases, by the States within which such duties are
respectively leviable.
(2) The proceeds in any financial year of any such duty leviable within
any State shall not form part of the Consolidated Fund of India, but shall be assigned to
that State.
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269. Taxes levied and collected by the Union but assigned to
the States.-
226A[(1) Taxes on the sale or purchase of
goods and taxes on the consignment of goods shall be levied and collected by the
Government of India but shall be assigned and shall be deemed to have been assigned to the
States on or after the 1st day of April, 1996 in the manner provided in clause (2).
Explanation-For the purposes of this clause, -
(a) the expression “taxes on the sale or purchase of goods”
shall mean taxes on sale or purchase of goods other than newspapers, where such sale or
purchase takes place in the course of inter-State trade or commerce;
(b) the expression “taxes on the consignment of goods” shall
mean taxes on the consignment of goods (whether the consignment is to the person making it
or to any other person), where such consignment takes place in the course of inter-State
trade or commerce;
(2) The net proceeds in any financial year of any such tax, except in
so far as those proceeds represent proceeds attributable to Union territories, shall not
form part of the Consolidated Fund of India, but shall be assigned to the State within
which that tax is leviable in that year, and shall be distributed among those States in
accordance with such principles of distribution as may be formulated by Parliament by
law.]
_227[(3) Parliament may by law formulate
principles for determining when a _230[sale or purchase of,
or consignment of, goods] takes place in the course of inter-State trade or commerce.]
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270. Taxes levied and distributed between the Union and the
States
_227A[(1) All taxes and duties referred to
in the Union List, except the duties and taxes referred to in articles 268 and 269,
respectively, surcharge on taxes and duties referred to in article 271 and any cess levied
for specific purposes under any law made by Parliament shall be levied and collected by
the Government of India and shall be distributed between the Union and the States in the
manner provided in clause (2).
(2) Such percentage, as may be prescribed, of the net proceeds of any
such tax or duty in any financial year shall not form part of the Consolidated Fund of
India, but shall be assigned to the States within which that tax or duty is leviable in
that year, and shall be distributed among those States in such manner and from such time
as may be prescribed in the manner provided in clause (3).
(3) In this article, “Prescribed” means -
(i) until a Finance Commission has been constituted, prescribed by the
President by order, and
(ii)after a Finance Commission has been constituted, prescribed by the
President by order after considering the recommendations of the Finance Commission.’]
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271. Surcharge on certain duties and taxes for purposes of the
Union.-
Notwithstanding anything in articles 269 and 270, Parliament may at any
time increase any of the duties or taxes referred to in those articles by a surcharge for
purposes of the Union and the whole proceeds of any such surcharge shall form part of the
Consolidated Fund of India.
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274. Prior recommendation of President required to Bills
affecting taxation in which States are interested.-
(1) No Bill or amendment which imposes or varies any tax or duty in
which States are interested, or which varies the meaning of the expression
"agricultural income" as defined for the purposes of the enactments relating to
Indian income-tax, or which affects the principles on which under any of the foregoing
provisions of this Chapter moneys are or may be distributable to States, or which imposes
any such surcharge for the purposes of the Union as is mentioned in the foregoing
provisions of this Chapter, shall be introduced or moved in either House of Parliament
except on the recommendation of the President.
(2) In this article, the expression "tax or duty in which States are interested"
means-
(a) a tax or duty the whole or part of the net proceeds whereof are
assigned to any State; or
(b) a tax or duty by reference to the net proceeds whereof sums are for
the time being payable out of the Consolidated Fund of India to any State.
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275. Grants from the Union to certain States.-
(1) Such sums as Parliament may by law provide shall be charged on the
Consolidated Fund of India in each year as grants-in-aid of the revenues of such States as
Parliament may determine to be in need of assistance, and different sums may be fixed for
different States:
Provided that there shall be paid out of the Consolidated Fund of India
as grants-in-aid of the revenues of a State such capital and recurring sums as may be
necessary to enable that State to meet the costs of such schemes of development as may be
undertaken by the State with the approval of the Government of India for the purpose of
promoting the welfare of the Scheduled Tribes in that State or raising the level of
administration of the Scheduled Areas therein to that of the administration of the rest of
the areas of that State:
Provided further that there shall be paid out of the Consolidated Fund
of India as grants-in-aid of the revenues of the State of Assam sums, capital and
recurring, equivalent to-
(a) the average excess of expenditure over the revenues during the two
years immediately preceeding the commencement of this Constitution in respect of the
administration of the tribal areas specified in _232[Part I]
of the Table appended to paragraph 20 of the Sixth Schedule; and
(b) the costs of such schemes of development as may be undertaken by
that State with the approval of the Government of India for the purpose of raising the
level of administration of the said areas to that of the administration of the rest of the
areas of that State.
(1A) On and from the formation of the autonomous State under article
244A,-
(i) any sums payable under clause (a) of the second proviso to clause
(1) shall, if the autonomous State comprises all the tribal areas referred to therein, be
paid to the autonomous State, and, if the autonomous State comprises only some of those
tribal areas, be apportioned between the State of Assam and the autonomous State as the
President may, by order, specify;
(ii) there shall be paid out of the Consolidated Fund of India as
grants-in-aid of the revenues of the autonomous State sums, capital and recurring,
equivalent to the costs of such schemes of development as may be undertaken by the
autonomous State with the approval of the Government of India for the purpose of raising
the level of administration of that State to that of the administration of the rest of the
State of Assam.]
(2) Until provision is made by Parliament under clause (1), the powers
conferred on Parliament under that clause shall be exercisable by the President by order
and any order made by the President under this clause shall have effect subject to any
provision so made by Parliament:
Provided that after a Finance Commission has been constituted no order
shall be made under this clause by the President except after considering the
recommendations of the Finance Commission.
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280. Finance Commission.-
(1) The President shall, within two years from the commencement of this
Constitution and thereafter at the expiration of every fifth year or at such earlier time
as the President considers necessary, by order constitute a Finance Commission which shall
consist of a Chairman and four other members to be appointed by the President.
(2) Parliament may by law determine the qualifications which shall be requisite for
appointment as members of the Commission and the manner in which they shall be selected.
(3) It shall be the duty of the Commission to make recommendations to
the President as to-
(a) the distribution between the Union and the States of the net
proceeds of taxes which are to be, or may be, divided between them under this Chapter and
the allocation between the States of the respective shares of such proceeds;
(b) the principles which should govern the grants-in-aid of the
revenues of the States out of the Consolidated Fund of India;
[(bb) the measures needed to augment the Consolidated Fund of a State
to supplement the resources of the Panchayats in the State on the basis of the
recommendations made by the Finance Commission of the State;]
[(c) the measures needed to augment the Consolidated Fund of a State to
supplement the resources of the Municipalities in the State on the basis of the
recommendations made by the Finance Commission of the State;]
[(d)] any other matter referred to the Commission by the President in
the interests of sound finance.
(4) The Commission shall determine their procedure and shall have such
powers in the performance of their functions as Parliament may by law confer on them.
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281. Recommendations of the Finance Commission.-
The President shall cause every recommendation made by the Finance
Commission under the provisions of this Constitution together with an explanatory
memorandum as to the action taken thereon to be laid before each House of Parliament.
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282. Expenditure defrayable by the Union or a State out of its
revenues.-
The Union or a State may make any grants for any public purpose,
notwithstanding that the purpose is not one with respect to which Parliament or the
Legislature of the State, as the case may be, may make laws.