(Sample Material) UPSC IAS Mains GS Online Coaching : Paper 2 - "Statutory, Regulatory And Various Quasi Judicial Bodies"

Sample Material of Our IAS Mains GS Online Coaching Programme

Subject: General Studies (Paper 2 - Governance, Constitution, Polity, Social Justice and International relations)

Topic: Statutory, Regulatory And Various Quasi Judicial Bodies



To bring about meaningful co-operation among the States Art. 263 contemplates establishment of an Inter-State Council. The Sarkaria Commission recommended the setting up of an Inter-State Council for resolving Centre-State problems. The Council has been established by an order dated 28th May 1990. It consists of the Prime Minister, the Chief Ministers of all States and Union Territories and Six Union ministers, the Chief Ministers of all States and Union Territories and Six Union ministers of cabinet rank.

A Minister of State with independent charge may be invited if there is in the agenda a matter pertaining to this Department. The Prime Minister is the Chairman of the Council. It is required to meet thrice a year. Decisions are required to be based on consensus. It is a recommendatory body and was established forty years after the Constitution came into force. After its establishment there exists a forum for inter-governmental consultation, co-ordination and co-operation.

The duties of the Council are:

(a) investigating and discussing such subjects in which one or more of the States have common interest.
(b) to make recommendations upon such a subject and for better coordination of policy and action in respect to that subject.
(c) Deliberating on such other matters of general interest to the States as may be referred by the Chairman.

In the present milieu where there are more than 7 different parties in power in the States and a coalition government at the Centre the Inter-State Council is a useful device to iron out differences and adopt a national view based on consensus.


In India we have witnessed a spectacle where the States do not have adequate financial resources. Some States are entirely dependant on Central grants while others are substantially dependant. No State can claim to be financially self-sufficient. After the implementation of the recommendations of the 5th Pay Commission (1995) some of the States do not have revenues to meet the expenditure on salaries of government staff. In Canada and Australia also the States survive on Central grants. In U.S.A. gradually the resources of the Union have increased and the States need grants to meet both ends meet.

It has a certain extent made the federations as partnership between unequals. It has led to partial erosion of independence and reduction of autonomy of the States.

Our Constitution contains detailed provisions allotting financial resources between the Union and the States. It has provided a complex mechanism to make the distribution of financial resources equitable. Care has been taken to ensure that the division is not permanent and for all times but is subject to review and adjustments at regular intervals. The Constitution makes a distinction between power to levy and collect tax and to appropriate the tax so collected. Income-tax may be levied and collected by the Union but the proceeds of the Income-tax are to be shared by the Union and the States.


No tax may be levied or collected except by authority of law (Art. 265). Tax cannot be imposed by executive order. It can be levied only by an Act of appropriate legislature. The law must be a valid law. The courts examine it from three angles (a) The law is within the legislative competence of the legislature related to an entry in the relevant list, (b) The law is not prohibited by any specific provision of the Constitution e.g. 276,285,286,287 etc. (c) The law is not void under Art. 13 for violating a fundamental right.

The difference may be thus tabulated:



1. A compulsory exaction from all 1. A compulsory exaction from all
persons who fall in tax net. person who derive a
benefit or obtain a service.
2. Taxation is an imposition for purpose. 2. Fees are related to specific purposes public
and objects.
3. There is no quid pro quo between payer
and the public authority.
3. There must be some quid pro quo. The the tax relation may be tenuous or thin.
It may be absent in case of license fee.
4. Taxation is part of common burden. 4. Fees are regarded as charge for specific service rendered
by the government or its agency.
5. Taxes are credited to the 5. Fees are gradually kept separate but Consolidated Fund.
may be credited to the Consolidated Fund. It does not effect its validity.
Creation of separate fund not necessary.
6. Taxes are not related to services. 6. Fees may sometimes be not related to services e.g.
license fee charged for regulating some activities.
The activities may be hotels, nursing, homes, beauty parlours.

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