DEMOCRATIC DECENTRALISATION IN INDIA: AN OVERVIEW

Introduction

Decentralization is a process of transferring power to popularly elected local

governments. Transferring power, means providing local governments with greater
political authority (e.g., convene local elections or establish participatory processes),
increased financial resources (e.g., through transfers or greater tax authority), and provide
more administrative responsibilities. Enthusiasm for, and experiments with,
decentralization have swept the world over the past four decades. Theory strongly argues that
decentralization should increase citizen voice and participation in the political process, and
so make government more responsive and accountable to the governed. These
intuitions have prompted a massive policy response across the globe, with an estimated 80-
100 percent of the world‘s countries experimenting with some kind of decentralization
reform.

Decentralization is a widely used concept, and it is closely linked with democracy,

development and good governance. Many research findings clearly demonstrate that
decentralization provides an institutional mechanism through which citizens at various
levels can organize themselves and participate in the decision making process.Local
government is one form of a decentralized system which is affected by the transfer of
authority or responsibility for decision making, management or resources allocation from
higher level of government to its subordinate units. The role of local government varies from
one country to another, but in every democratic society local government has some part to
play. In most South Asian countries, rural authorities are characterized by a weak institutional
capacity to deliver public services and promote local development.

Since the early 1980s, decentralization has re-emerged as a valued political and
economic goal in most developing countries. According to a recent World Bank study,
―out of 75 developing and transitional countries with populations greater than 5 million, all
but 12 claim to be embarked on some form of transfer of political power to local units of
government.‖ Advocates of decentralization justify it on grounds of increased efficiency,
more thorough going equity, and/or greater participation and responsiveness of
government to citizens. Despite these claims, most decentralization efforts end up not
significantly increasing the powers of local authorities or peoples. Decentralization has
been defined as any act in which a central government formally cedes powers to actors and
institutions at lower levels in a political administrative and territorial hierarchy. Devolving
powers to lower levels involves the creation of a realm of decision making in which a
variety of lower-level actors can exercise some autonomy. For a short statement on the
degree of local autonomy in several developing countries, and the relationship of such
autonomy to the colonial experience, Deconcentration (or administrative decentralization)is
said to occur when powers are devolved to appointees of the central government.
Political decentralization is different from deconcentration since powers in this case are
devolved to actors or institutions that are accountable to the population in their jurisdiction.
Typically, elections are seen as the mechanism that ensures accountability in political
decentralization.

Most justifications of decentralization are built around the assumption that greater
participation in public decision making is a positive good in itself or that it can improve
efficiency, equity, development and resource management. By bringing government
decision making closer to citizens, decentralization is widely believed to increase public–
sector accountability and therefore effectiveness. At its most basic, decentralization aims to
achieve one of the central goals of just political governance—democratization, or the
desire that humans should have a say in their own affairs.

Decentralization is not unique to India, but a global trend. Institutions of local

governance - Panchayati Raj, have existed in India since 1882. The Indian Constitution
defines PRIs as institutions of Self Government. This means, there must be unambiguous
administrative, fiscal, and political devolution such that local governments are empowered to
address local development needs. But there is only minimum administrative and fiscal
decentralization. Hence PRIs do not have such capacity to implement assigned functions,
which remain de facto under the control of the state administration. And because PRIs
control few resources, do not make relevant decisions, and are dysfunctional, the rural
constituency shows little interest in them. Through the 73rd amendment to the Constitution
and subsequent developments, local government took on a qualitatively different hue in India.
This act is a significant landmark in the evolution of grassroots democratic institutions
in the country. It transfers the representative democracy into participatory democracy.
It provides greater opportunities to the local people to participate in the democratic
process. It is a revolutionary concept to build democracy at the grassroots level in the
country. It makes decentralization process in India successful to a large extent.

Democratic Decentralization in India: An overview

Decentralized governance is a process which allows people's involvement in
administration and development programmes. It remains significant for the realization of
people-centred development and therefore, decentralized governance is a strategy for all
people to enjoy equal rights, and is an instrument for building the capacity for economic
development. India, of course, is not alone in this process. Decentralisation has emerged
as a dominant trend in world politics. In 1998, the World Bank estimated that all but 12 of the
75 developing and transitional countries with populations greater than 5 million had
embarked on a process of political devolution. International comparisons of rural
decentralization suggest Indian states are amongst the most politically decentralized, are at
the level of other countries/states on fiscal decentralization, and are lagging on
administrative decentralization (World Bank overview).Democratic decentralization is
neither deconcentration nor delegation. It is devolution. A Task Force on Decentralization of
the government of India (GOI) defines devolution thus ―Devolution in the context of the
Panchayats, means that when the authority in respect of a specific activity is transferred from
the state to the local governments, the latter should have the prerogative of taking decisions in
respect of planning and implementation of such activity. In fact functions, funds and
functionaries are complementary to one another in the process of devolution of
responsibilities and powers upon the Panchayats‖. GOI (2001): 5). Here local governance is
seen as an integral element of the federal system and involves devolution of functions, funds
and functionaries to Panchayats.
Many analyses of decentralization consider the transfer of powers in three sectors to be
necessary for success. Manor, for example, argues, ―If it is to have significant promise,
decentralization must entail a mixture of all three types: democratic, fiscal, and
administrative. These Political, administrative, and fiscal decentralization can appear in
different forms and combinations across countries, within countries and even with in
sectors. Political decentralization is the transfer of authority to a sub national body.
Political decentralization aims to give citizens or their elected representatives more power in
public decision making. It is often associated with pluralistic and representative
government, but it can also support democratization by giving citizens, or their
representatives, more influence in the formulation and implementation of policies. This
form of decentralisation is synonymous with democratic decentralisation or devolution.
Fiscal decentralisation, entailing the transfer of financial resources in the form of grants and
tax-raising powers to sub-national units of government. Administrative decentralisation,
(sometimes referred to as deconcentration), where the functions performed by central
government are transferred to geographically distinct administrative units.

The status of citizens and progress of the society to a large extent depends on the good
governance at the grassroots level. Democratic decentralization at the grassroots level is
envisages as the most important strategy to make democracy meaningful and achieve greater
goals of a responsive, corruption free, effective and transparent administration and delivery of
services to the rural and urban population. Decentralization and development of local
administration widely recognised an effective political instrument and means realisation
of balanced and equitable development in Indian states. Decentralization of power aims at
better and faster communication, involvement and commitment of the people in
development, mobilisation of support and utilization of resources in a greater manner for
national development, reduction in delay in decision-making, greater equity in allocation of
resources and investments as well as reduction in apathy of administration to client. In this
context, a 22 years after the 73rdConstitutional Amendment, it is universally and acutely
realised that the process of democratic decentralization cannot be complete without
devolution of adequate and rightful financial and administrative powers to the grassroots
institutions.

Democratic Decentralization and 73rd Amendment Act 1992

When the constitution of independent India was written Panchayati raj institutions did
not get a place in its main body; only a reference in the directive principles of state policy.
Therefore, the state did not take both the Urban and rural local bodies seriously. The Indian
states were functioning as a federation only at two levels- Union and States. Due to the
indifferent attitude of the central and state governments towards the devolution of powers to
PRI‘s made no headway in the years after independence, though a lot of noise was made at
every possible juncture.

Milestones in Indian decentralisation

1882 The Resolution on Local Self-Government.

1907 The Royal Commission on Decentralisation.
1948 Constitutional debates between Gandhi and Ambedkar on Gram Swaraj, ‗self-rule‘.
1957 Balwantrai Mehta Commission – an early attempt to implement the Panchayat structure
at district and block (Samithi) levels.
1963 K.Santhanam Committee – recommended limited revenue raising powers for
Panchayats and the establishment of State Panchayati Raj Finance Corporations.
1978 Asoka Mehta Committee – appointed to address the weaknesses of PRIs, concluded that
a resistant bureaucracy, lack of political will, ambiguity about the role of PRIs, and élite
capture had undermined previous attempts at decentralisation, recommending that the
District serve as the administrative unit in the PRI structure. Based on these
recommendations, Karnataka, Andhra Pradesh and West Bengal passed new legislation
to strengthen PRIs.
1985 G.V.K. Rao Committee – appointed to address weaknesses of PRIs, recommended that
the block development office (BDO) should assume broad powers for planning,
implementing an monitoring rural development programmes.
1986 L.M. Singvhi Committee – recommended that local self-government should be
constitutionally enshrined, and that the Gram Sabha (the village assembly) should be
the base of decentralised democracy in India.
1992 The 73rd Amendment to the Indian Constitution – PRIs at district, block and village
levels are granted Constitutional status. The Gram Sabha is recognised as a formal
emocratic body at the village level. The 74th Amendment, granting Constitutional
status to municipal bodies, is passed soon after.
1996 The Adivasi Act – Powers of self-government are extended to tribal communities living
;lin Fifth Schedule‘ areas.

International Journal of Social Science & Interdisciplinary

Research_____________________________ ISSN 2277-3630
IJSSIR, Vol. 3 (7), JULY (2014)
Online available at indianresearchjournals.com

200

Against this backdrop that on 15 May 1989 the Constitution (64th Amendment) Bill was
drafted and introduced in Parliament. Although the 1989 Bill in itself was a welcome step,
there was serious opposition to it.Though the Constitution Bill won a two-thirds
majority in the LokSabha, it failed to meet the mandatory requirement by two votes in the
RajyaSabha .The National Front government introduced the 74th Amendment Bill (a
combined bill on panchayats and municipalities) on 7 September 1990 during its short
tenure in office but it was never taken up for discussion. By this time, all the political parties
had supported a constitutional amendment for strengthening panchayats in their statements
and manifestos and a pro-panchayati raj climate prevailed in the country. In September
1991, the Congress Party government introduced the 72nd (Panchayats) and 73rd
(Municipalities) Constitutional Amendment Bills, which were passed in both chambers
in December 1992 as the 73rd and 74th Amendment Acts, and came into force in 1993.

This journey from the local self-government idea of Lord Ripon to the institutions of self-
govern ment concept in the 73rd Constitution Amendment, which took more than a century,
has been described at some length to bring home the fact that today‘s decentralisation
and local government in India is the result of an evolutionary process that a traditional and
complex society has gone through because of internal compulsions, pressures and
demands from the people, channelled through communities, civil society organisations,
intellectuals, political parties and ideologies, people‘s movements, occasional
interventions of the state (provincial) and central (federal) governments – and above all
because of people‘s urge for participation in development and governance through
democratically elected bodies. The panchayati raj institutions in India have been ordained to
empower people at the three appropriate levels but the aim has fulfilled to a greater extent
with the promulgation of 73rd Constitutional Amendment Act 1992. 73rd amendment
strengthens administrative federalism in order to facilitate and encourage delegation of
administrative and financial powers from the states to the local bodies. There administrative
powers and to discharge their responsibilities, are entirely derived from legislation that will
have to passed by the states. Decentralization denotes the transfer of power and authority
from the central government to local units of the government for the meeting of grass root
peoples demand. The 73rd Amendment gives village, block and district level bodies a
constitutional status under Indian Law. The more important features of the amendment are
summarized below:

1.The act provides for a Gram Sabha as the foundation of the Panchayati raj system.
2.The establishment of three tier system of Panchayati Raj Institution (PRI), with elected
bodies at village, block and district level, however, a States with population less than 20
lakh are not required to introduce block level Panchayat.
3.Direct elections to 5 year terms for all members at all levels.
4.Reservation of 1/3 of the seats for women and for backward classes.
5.A state election commission will be created to supervise, organize and oversee
Panchayat elections at all level. A State Finance Commission will be established to
review and revise the financial position of the Panchayats on five year intervals and to
make recommendations to the State Governments about the distribution of
Panchayat funds.

6.The governor of a state shall, after every five years, constitute a finance
commission to review the financial position of the panchayats.

It would be proper to assess the significance of Democratic Decentralization in India

by analyzing the level of progress made by the initiative. Using the conventional
classification of political, administrative and fiscal decentralization, the World Bank‘s
three Volume study of Indian Decentralization ranks India among the best Performers
internationally in terms of Political decentralization but close to the last in terms in terms of
administrative decentralization. M A. Oommen‘sPanchayat Finance and Issues concludes that
the conformity acts have generally been an exercise in amending existing Panchayat
legislation for the sake of satisfying the mandatory provisions of the 73rd Amendment. He
raises the following concern; Village Panchayats have been delegated functions without
proper administrative and financial support. Panchayats lack discretionary powers
overspending and staff. States reserve the rights to assign or withdraw functions to and
from the Panchayats by ‗Executive Fiat. Panchayats lack autonomous budgeting powers.
Still much work needs to be done including the removal of corruption to make more
effective, the decentralization initiative, which has shown a respectable level of progress.
To sum up we may say that, the most revolutionary measures in recent decades in the
process of decentralization have been the 73rd Constitutional Amendments. According to
S N Jha; ―The 73rd and 74th amendments are designed to promote self-governance
through statutory recognition of local bodies. The latter are expected to move away
from their traditional role of simply executing the programs handed down to them by the
higher levels of government‖.
Conclusion
Decentralization is widely lauded as a key component of good governance and
development. Decentralization and democracy may improve the chances for successful
economic development. It is clear that an honest effort to alleviate poverty and promote
sustainable development in India requires considerable decentralisation of government
authority, well beyond the state level. The passing of the 73rd Constitutional Amendments in
1992 was a crucial step in this direction, identifying Panchayati Raj Institutions (PRIs) as
agents of self-governance and giving them the responsibility for preparing plans for
promoting economic development and social justice. While most states have ratified the 73rd
Amendments in state acts and held elections, the quality of political, administrative and fiscal
decentralisation varies widely from one state to the other. In general, states have not matched
the functions devolved to local government institutions with the necessary administrative
reforms, or by devolving financial powers. As a result, have neither the capacity to
implement assigned functions – which remain de facto under the control of state
administration – nor do they have the control on resources to make relevant decisions. In
order to strengthening the decentralization process 73rd amendment must be more
practical. All activities need to be identified and developed at the three levels of local
government without duplication. This principle holds that anything that can be done at a
lower level should be done at that level and not at any higher level. Government should
ensure both fair and regular elections for local government bodies. Without proper popular
representation, local interests would not be protected and local initiatives would not
receive the required levels of support. Unnecessary interference by bureaucrats, political
leaders and members of parliament must be stopped. The relationship between MPs and local
government should be cooperative and complementary, not domination and subjugation.
Evolution of Rural Local Self Government

The establishment of a military state by the Mughals was the end of the rural system of local
communities about which Sir Charles Metcalfe wrote that they contributed more than any
other cause to the preservation of the people of India through all the revolutions and changes
which they have suffered. From Akbar to Aurangzeb, the empire maintained a district
administration without any local bodies.

The English rulers found the countryside blank and a French model of perfecturate of a
collector was their natural response. With their commercial establishments at port cities and
in the rim land belt, the Board of Directors of the company thought of urban local bodies first
and created corporation in Madras (1688) Calcutta (1722) and Bombay (1793).

The British collector found the rural countryside non-conducive for local reforms. It was as
late as the year 1864 that Lord Lawrence brought a resolution in the Governor General’s
Executive Council about Indian peoples capability to run their own local affairs. Lord Mayo
(1870) in a resolution adopted decentralisation with respect to sanitation and public works.

In 1871 and 1874, new municipal Acts were passed providing for elective municipal bodies.
But the most important step came in 1882 when the famous Ripon Resolution of Local Self-
Government, became the basis of local self-government in India. But after Ripon’s governor-
generalship local self-government did not receive much encouragement. In 1915, the
Government of India resolved to reform local bodies and the declaration of 1917 assured a
progressive realisation of responsible government in India.

Under dyarchy, the provincial governments exhibited some progress of local reforms. The
provincial autonomy enshrined in the Government of India Act, 1935 marked by a significant
move in the direction of democratising local bodies and strengthening them. There were
variations in the nomenclatures of different institutions in different provinces.

Like the guilty men of partition, the founding fathers of the Constitution have been called the
betrayer of Mahatma’s dream of autonomous village republics. They systematically avoided
the basic provisions for a gramrajya or a ‘Ramrajya’ and like the Royal Proclamation of
1917, only promised to put rural India “on the road to self-government by developing self-
governing institutions in installments”.

The local bodies were made the creatures of state legislatures without any independent and
separate status of their own. Entry fifth in the Seventh Schedule included “local government,
that is to say, the constitution of municipal corporations, improvement trusts, district boards,
mining settlement authorities and other local authorities for the purpose of local self-
government or village administration”. The Article 40 of the Constitution on Directive
Principles of State Policy got away by enjoining upon the state to “take steps to organise
village panchayats and endow them with such powers and authority as may be necessary to
enable them to function as units of local government”.

Pandit Nehru unlike Gandhi had a different philosophy and vision of rural development. He
resolved to launch community development projects in the countryside through a special
ministry of CD and through an ongoing thrust of Five-Year Plans to be formulated by the
Planning Commission.

In pursuance of the Directive Principles of State Policy for a new social order, ways and
means were explored and the Fiscal Commission of 1949 recommended the launching of a
national extension service for the entire country. The Planning Commission in the First Five-
Year Plan made a proposal for setting up a rural extension service for securing integrated
development.

Community development was described as the method and rural extension as the agency
through which the transformation of the social and economic life of villages was to be
attempted.

Thus, the community development programme which was launched on October 2, 1952
aimed at:
(a) All round development of the people in rural areas, and
(b) People’s participation in these programmes of rural reconstruction.

The Experience of Community Development:

The experience of community development experiment through bureaucracy of the district
produced mixed results. The Planning Commission came forward in a big way and the entire
concept of community development and the administration of the programme were entrusted
to a newly created agency called the community projects administration, located in the

Planning Commission.
This agency was raised to the status of a separate and independent ministry of community
development in 1956. The same year the ministry was merged into the ministry of food and
agriculture and continued there till 1974. The main functions of the department of community
development were to lay down policy relating to this programme and formulate the plan of
expenditure to be incurred in the blocks.
The picture differed from state to state and block development and district development
became controversial areas in administrative policy. The CD Ministry and its Secretary
Mukerjee maintained that “community development was a roaring success and extension
scheme should continue”. At this time came the report of BalwantRai Mehta Committee on
the working of plan projects and programmes in the states. This 1957 report not only strongly
refuted the claim of bureaucracy but maintained its following position in very strong words:
So long we do not discover and create representative and democratic institution which will
supply the local interest, supervision and care necessary to ensure that expenditure of money
upon local objects conforming with the needs and wishes of the locality and invest it with
adequate powers and assign to it appropriate finances, we will never be able to evoke local
interest and excite local initiative in the field of development.
With these words, the Mehta Committee wrote the Magna Carta of rural folks of India who
were to have a three-tier structure of local bodies at village, block and district levels under the
scheme of democratic decentralisation. The Mehta Committee conceived the middle tier of
panchayatsamiti as an executive body and zilaparishad as a coordinating and supervisory
body with district collector as chairman of the zilaparishad. All planning and development
activities were to be entrusted to the elected representatives.

The major recommendations of BalwantRai can be summed up as under:

1. A three-tier system of Panchayati Raj from the village to the district level with multi-
level linkages be created. The institutions envisaged were zilaparishad at the district
level, panchayat samiti at the block level and gram panchayat at the village level.
2. There should be a genuine transfer of power of these institutions.
3. Adequate resources should be transferred to these bodies.
4. All developmental schemes at these levels should be channeled through these PR
institutions.
5. The system of Panchayati Raj should facilitate further devolution and disposal of
power, responsibilities and resources in the future.

The National Development Council accepted these recommendations in January 1959 and
desired flexible patterns to grow as per needs of the states. The credit goes to B.R. Mehta for
legitimizing the system and presenting a concrete and viable alternative to develop popular
participation in development administration.

The panchayati institutions were to groom rural leadership and could bring rural people to the
main stream of national life. Given the opportunity, these institutions were going to develop
democratic traditions and help in revitalising self-confidence and responsible citizenship in
rural areas.

The state governments were to initiate and monitor this change and the three-tier system
acquired different institutional forms in the states of Rajasthan, Andhra Pradesh, Karnataka
and Maharashtra. This phenomenal growth of PRI in the country since 1975 to 2005 speaks
volumes about the dynamism of rural people of India.

The B.R. Mehta report entrusted three specific roles to Panchayati Raj bodies:
(1) To work as unit of rural local government.
(2) To serve as an instrument of community development.
(3) To act as an agency of state governments.

The experiment being unprecedented evoked a wide variety of patterns about:

(1) The core unit of development,
(2) Association of the collector, and
(3) The area and size of the panchayat samiti.

The Maharashtra Model made the president of zilaparishad a virtual chief minister of the
district, while the Rajasthan and the Karnataka models made block as the core unit and kept
zilaparishads as supervisory and coordinating units. In Maharashtra, Gujarat, West Bengal
and Karnataka the collector was kept out of the zilaparishad while in Uttar Pradesh and Bihar,
he was entitled to attend the meetings of the panchayatsamiti and its standing committees but
without a right to vote. In Assam, Punjab, and Rajasthan, the collector was a non-voting
member of the zilaparishad. In Tamil Nadu, he was the chairman of District Development
Council as well as of the zilaparishad and in Andhra Pradesh he was not only the member of
the zilaparishad but the chairman of all the standing committees.

From One Mehta to Other Mehta:

The three-tier experiment of Panchayati Raj bodies encouraged research in this area and a
number of committees skirted their findings around the block and district models in
operation.

Some of the study teams and committees appointed to examine the functioning of
Panchayati Raj between 1960 to 1976 were the following:

These committees helped in evolving the reform model on the basis of field experience of PR
institutions. Meanwhile, the government at Centre got involved into a series of crises and
Prime Minister Indira Gandhi having carved out a Bangladesh found herself trapped in
National Emergency in 1975.

The panchayati experiment was put on the sack burner and the post-emergency Janta
government in 1977 drafted a second Mehta (this time Ashok Mehta) to do the surgery of
ailing panchayati institutions which were mostly in a state of suspended animation. The Janta
coalition wanted to explore the possibilities of reviving and strengthening Panchayati Raj and
Ashok Mehta a veteran socialist and former Deputy Chairman of Planning Commission
submitted his report in 1978.

This Ashok Mehta Committee prefaced its report containing 132 recommendations leading to
a new approach towards Panchayati Raj. This new approach was to view Panchayati Raj as
‘Government’ in its own right at the grass-roots level. The report said, “the formulation of
structural functions and the utilisation of financial, administrative and human resources in
Panchayati Raj institutions should in our opinion be determined on the emerging financial
necessity of management of rural developments.”

1. The Ashok Mehta Committee recommended:

2. A two-tier structure of Panchayati Raj in place of the BalwantRai Structure of three
tiers. The district body to be the executive and the block or taluka bodies as viable
operational units with a population of 15,000 to 20,000.
3. The Nyaya Panchayats to be presided by a qualified judge and function as a separate
unit.
 4. Open participation of political parties in Panchayati Raj affairs by contesting election
on a party basis with reserved constituencies for Scheduled Castes and Scheduled
Tribes and minimum of two reserved seats for women. The Panchayati Raj elections
should be conducted by the Chief Election Officer of the state in consultation with the
Chief Election Commissioner.
5. The zilaparishad should be responsible for planning at the district level with
compulsory powers of taxation to reduce their dependence on the state government.
6. There should be an independent authority to carry out ‘Social Audit’ of the funds to
check whether funds allocated for weaker sections are actually spent on them. A
Social Justice Committee in each zilaparishad should ensure that Panchayati Raj
bodies function for the welfare of the weaker groups.
7. The state government must not supersede Panchayati Raj institution on partisan
grounds. If necessary there should be elections within six months.
8. A minister for Panchayati Raj should hold charge of the Panchayati Raj department to
look after the enactment of Panchayati Raj legislation; elections to Panchayati Raj
institutions; promotion of audit of Panchayati Raj accounts; review of Panchayati Raj
activities for report to the state legislature; and promotion of camp training of elected
members of Panchayati Raj.
9. Development functions should be transferred to the zilaparishads and all development
staff should work under the elected district body.
10. The collector would continue to exercise the regulatory, revenue and other functions
assigned by the state government.
11. The voluntary agencies should mobilise people’s support for Panchayati Raj and
should be strengthened and encouraged to supplement the efforts of the Panchayati
Raj institutions.

The chief ministers at their conference at New Delhi in May 1979 considered the committee’s
report and prepared a set of guidelines to draft a model bill. But the collapse of the Janta
government at the centre put an end to further progress in this direction. Though the
recommendations of the committee were not accepted by the Union government due to
change in the ruling party still, some of these did exercise varying influence upon the
working of Panchayati Raj. The states of Karnataka and Andhra Pradesh took special interest
and a fair trial was given to Ashok Mehta model envisaged in the above recommendations.

From Rajiv to Rao:

The period from 1978-1990 was the most tumultuous period when India was rocked by
political turbulence, instability and assassinations of two prime ministers in succession. The
political landscape changed drastically and Prime Minister Rajiv Gandhi was advised to
revive Panchayati Raj institutions to take care of the non-Congress ruled states which were
threatening to destabilise his sympathy vote bank. The C.H. HanumanthaRao report came on
District Planning in 1984.

The Rao Committee suggested:

(1) Decentralised planning at district level.
(2) Separate district planning bodies under collector.
(3) Panchayati bodies should be associated with collector as coordinator.
(4) Development move function of Panchayati Raj rather than that of district administration.
Another significant area probed in the year 1985 was rural development and poverty allevi-
ation. The Planning Commission appointed G.V.K. Rao Committee which examined the
bureaucratisation of development administration.

The Rao Committee recommended:

(1) District as the unit of planning.
(2) Planning of rural development by PRI.
(3) Decentralised planning by transfer of state planning functions.
(4) District development commissioner to be the chief executive.
(5) Regular elections of Panchayati Raj bodies.

While these explorations were going on Prime Minister was forced by political circumstances
to revitalise democracy and development through Panchayati Raj. The CAARD (Committee
on Administrative Arrangement for Rural Development) report or GVR Rao report paved the
way for another committee for which Rajiv Gandhi selected L.M. Singhvi to be the chairman.
Singhvi Committee of 1986 heralded the era of constitutionalisation of panchayati
institutions.

The Singhvi Committee recommended:

(1) A new chapter should be added in the Constitution to give Panchayati Raj an
inviolable identity through regular free and fair elections.
(2) Naya Panchayats for a cluster of villages.
(3) Gram Sabhas as embodiments of direct democracy.
(4) More financial resources for Panchayats.
(5) Judicial tribunals for election disputes or punishments like dissolution, etc.

The 64th Constitutional Amendment Bill incorporated the recommendations of Singhvi

Committee. It was passed by LokSabha in August 1989 but the RajyaSabha could not muster
up the special majority. In fact, its provisions were later modified and put into the 73rd
Amendment of 1992.

The basic provisions of 64th Amendment were:

1. It should be mandatory for all states to set up PRIs,
2. The tenure of all panchayats would be five years and if dissolved before time, fresh
elections should be held within six months,
3. All seats (except a few meant for the representatives of other institutions) to be filled
through direct elections,
4. Their elections should be conducted by the Chief Election Commissioner,
5. Due reservation of seats to be made for SC/ST and women in all PR bodies,
6. PRIs to be entrusted with an increased range of functions such as minor irrigation, soil
conservation, bio-gas, health, benefits to SC/ST, etc.,
7. Planning and budgeting systems be introduced in an appropriate manner at the
panchayat level (Rajiv Gandhi emphasised this idea),
8. The accounts of PRIs be audited by the Comptroller and Auditor-General of India.
9. A separate commission be set up to review the finance of the PRIs, and
10. The state legislature may authorise panchayats to levy taxes, duties, tolls and fees.

After Rajiv Gandhi’s assassination,Prime Minister V.P. Singh continued the dialogue with
the chief ministers. His cabinet formulated the 74th Amendment but it got delayed on account
of the Congress Party coming to power under (late) P.V. NarsimhaRao as the New Prime
Minister. This time it was presented as 73rd Amendment which LokSabha passed on
December 6th, 1992 and RajyaSabha on December 23rd, 1992. Seventeen state legislatures
ratified it and the amendment could see the light of the day on April 24th 1993 on receiving
presidential assent four days later.

Thus, a glorious and epoch making chapter was added by the 73rd and 74th Amendments. It
fulfilled the gap which the Constituent Assembly left in the draft Constitution by being silent
about district government at the grass roots.

Panchayati Raj - 73rd Constitutional Amendment Act

A three-tier structure of the Indian administration for rural development is called Panchayati
Raj. The aim of Panchayati Raj is to develop local self-governments in districts, zones, and
villages.

73rd Constitutional Amendment Act of 1992

Significance of the Act

 The act added part IX to the constitution, “The Panchayats” and also added the
eleventh schedule which consists of the 29 functional items of the panchayats.
 Part IX of the constitution contains article 243 to Article 243 O.
 The amendment act provides shape to Article 40 of the constitution, (directive
principles of state policy), which directs the state to organise the village panchayats
and provide them powers and authority so they can function as self-government.
 With the act, Panchayati Raj systems come under the purview of justiciable part of the
constitution and mandates states to adopt the system. Further, the election process in
the Panchayati Raj institutions will be held independent of state governments will.
 The act has two parts: compulsory and voluntary. Compulsory provisions must be
added to state laws, which includes the creation of the new Panchayati Raj systems.
Voluntary provisions, on the other hand, is the discretion of the state government.
 The act is a very significant step in creating democratic institutions at the grassroots
level in the country. The act has transformed the representative democracy to
participatory democracy.
Salient Features of the Act

1. Gram Sabha: Gram Sabha is the primary body of the Panchayati Raj system. It is a
village assembly consisting of all the registered voters within the area of the
panchayat. It will exercise powers and perform such functions as determined by the
state legislature.
2. Three-tier system: The act provides for the establishment of the three-tier system of
Panchayati Raj in the states (village, intermediate and district level). States with a
population less than 20 lakhs may not constitute the intermediate level.
3. Election of members and chairperson: The members to all the levels of the Panchayati
Raj is elected directly and the chairperson to the intermediate and the district level is
elected indirectly from the elected members and at the village level the Chairperson is
elected as determined by the state government.
4. Reservation of seats:

 For SC and ST: Reservation to be provided at all the three tiers in accordance
with their population percentage.
 For women: Not less than one-third of the total number of seats to be reserved
for women, further not less than one-third of the total number of offices for
chairperson at all levels of the panchayat to be reserved for women.
 The state legislatures are also given the provision to decide on the reservation
of seats in any level of panchayat or office of chairperson in favour of
backward classes.
Duration of Panchayat: The act provides for a five-year term of office to all the levels of
the panchayat. However, the panchayat can be dissolved before the completion of its
term. But fresh elections to constitute the new panchayat shall be completed

 before the expiry of its five-year duration.

 in case of dissolution, before the expiry of a period of six months from the
date of its dissolution.
Disqualification: A person shall be disqualified for being chosen as or for being a member
of panchayat if he is so disqualified

 Under any law for the time being in force for the purpose of elections to the
legislature of the state concerned.
 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.
 Further, all questions relating to disqualification shall be referred to an
authority determined by the state legislatures.
State election commission:
 The commission is responsible for superintendence, direction and control of
the preparation of electoral rolls and conducting elections for panchayat.
 The state legislature may make provision with respect to all matters relating to
elections to the panchayats.

8. Powers and Functions: The state legislature may endow the Panchayats with such
powers and authority as may be necessary to enable them to function as institutions of
self-government. Such a scheme may contain provisions related to Gram Panchayat
work with respect to

 the preparation of plans for economic development and social justice

 the implementation of schemes for economic development and social justice
as may be entrusted to them, including those in relation to the 29 matters listed
in the Eleventh Schedule.
Finances: The state legislature may
  Authorise a panchayat to levy, collect and appropriate taxes, duties, tolls and
fees.
 Assign to a panchayat taxes, duties, tolls and fees levied and collected by the
state government
 Provide for making grants-in-aid to the panchayats from the consolidated fund
of the state.
 Provide for the constitution of funds for crediting all money of the panchayats.

10. Finance Commission: The state finance commission reviews the financial position of
the panchayats and provides recommendation for the necessary steps to be taken to
supplement resources to the panchayat.
11. Audit of Accounts: State legislature may make provisions for the maintenance and
audit of panchayat accounts.
12. Application to Union Territories: The president may direct the provisions of the act be
applied on any union territory subject to exceptions and modifications he specifies.
13. Exempted states and areas: The act does not apply to the states of Nagaland,
Meghalaya and Mizoram and certain other areas. These areas include,

 The scheduled areas and the tribal areas in the states

 The hill area of Manipur for which a district council exists and
 Darjeeling district of West Bengal for which Darjeeling Gorkha Hill Council
exists.
However, Parliament can extend this part to these areas subject to exception
and modification it specifies. Thus the PESA Act was enacted.
Continuance of existing law: All the state laws relating to panchayats shall continue to be
in force until the expiry of one year from the commencement of this act. In other
words, the states have to adopt the new Panchayati raj system based on this act within
the maximum period of one year from 24 April 1993, which was the date of the
commencement of this act. However, all the Panchayats existing immediately before
the commencement of act shall continue till the expiry of their term, unless dissolved
by the state legislature sooner.
Bar to interference by courts: The act bars the courts from interfering in the electoral
matters of panchayats. It declares that the validity of any law relating to the
delimitation of constituencies or the allotment of seats to such constituencies cannot
be questioned in any court. It further lays down that no election to any panchayat is to
be questioned except by an election petition presented to such authority and in such
manner as provided by the state legislature.

PESA Act of 1996

The provisions of part IX are not applicable to fifth schedule areas. The Parliament can
extend this part to such areas with medication and exceptions as it may specify. Under these
provisions, Parliament enacted Provisions of the Panchayats (Extension to the Scheduled
Areas) Act, popularly known as PESA act or the extension act.
Objectives of PESA act

1. To extend the provisions of part IX to the scheduled areas.

2. To provide self-rule for the tribal population.
3. To have village governance with participatory democracy
4. To evolve participatory governance consistent with the traditional practices.
5. To preserve and safeguard traditions and customs of tribal population.
6. To empower panchayats with powers conducive to tribal requirements.
7. To prevent panchayats at a higher level from assuming powers and authority of
panchayats at a lower level