31

COMMISSIONS

This Chapter is taken from our:

ISBN : 9789386146977
 32

5 COMMISSIONS
CHAPTER

1. Finance Commission Functions

The constitution of the Finance Commission
is laid down in Art. 280, which has to
be read with the Finance Commission
(Miscellaneous Provisions) Act of 1951.
The Commission has to be constituted by
the President, every five years.
The Chairman must be a person having
experience in public affairs; and the other
four members must be appointed from
amongst the following
(a) A High Court Judge or one qualified to
be appointed as such;
(b) person having special knowledge
of the finances and accounts of the
Government;
(c) a person having wide experience in
financial matters and administration;
(d) a person having special knowledge of
economics.
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;
(c) The measures needed to augment
the Consolidated Fund of a State
to supplement the resources of the
Panchayats in the State;
(d) The measures needed to augment
the Consolidated Fund of a State
to supplement the resources of the
Municipalities in the State;
(e) Any other matter referred to the
Commission by the President in the
interests of sound finance.

Finance Year of Chairman Operational Year of Submitting

Commission Establishment Duration Report
I 1951 K.C. Niyogi 1952-57 1952
II 1956 K. Santhanam 1957-62 1956* and 1957
III 1960 A.K. Chanda 1962-66 1961
IV 1964 P.V. Rajamannar 1966-69 1965
V 1968 Mahaveer Tyagi 1969-74 1968* and 1969
VI 1972 Brahma Nand 1974-79 1973
Reddy
VII 1977 J.M. Shellet 1979-84 1978
VIII 1983 Y.B. Chawan 1984-89 1983* and 1984
IX 1987 N.K.P.Salve 1989-95 1989
X 1992 K.C. Pant 1995-2000 Nov. 26, 1994
 33

XI 1998 A.M. Khusro 2000-2005 Jan. 15, 2000* &

7 july, 2000 & 31
Aug. 2000
XII 2003 C.Rangrajan 2005-10 Report submitted
on Nov. 30, 2004.
XIII 2007 Vijai L. Kelkar 2010-15 Submitted Report
on December 30,
2009
* Interim Report
The recommendations of the various commissions can be divided under three heads:
(A) Division and distribution of Income Tax and other taxes (show in Table 1 & 2)
(B) Grants-in-aid
(C) Loans to the states by the Centre

Table 1: Recommendations of Finance Commissions on Income Tax

Finance States Share of Distribution of Income Tax to the
Commission Income Tax States on the Basis of
(%) Population & Tax Contribution
other Criteria
I 55 80 20
II 60 90 10
III 65 80 20
IV 75 80 20
V 75 90 10
VI 80 90 10
VII 85 90 10
VIII 85 90 10
IX 85 90 10
X 77.5 20 80 (Other basis)

Table 2: Recommendations of Finance Commissions on Excise Duty

Finance States Share of Distribution of Excise Duty(%)
Commission Excise Duty
On the On the basis of backwardness
basis of of states the percentage of
population the poor in the states etc.
I 40% of 3 duties 40 60
II 25% of 8 duties 40 60
III 20% of 35 duties 40 60
 34
IV 20% of 45 duties 80 20
V 20% of 45 duties 80 20
VI 20% of 45 duties 75 25
VII 40% of all duties 25% of Four Factors
VIII 45% of all duties New Formula
IX 45% of all duties New Formula
X 47.5% of all duties New Formula

Highlights : At a Glance
Thirteenth Finance Commission 2010-15
Chairman Mr. Vijai Kelkar
About Devolution
States to get 32% of central taxes, compared to 30.5% now.
Up to 2.5% of dividible pool may be transferred as grants to local bodies.
Total transfers to states on the revenue account be capped at 39.5% of the Centres
gross tex revenue, compared to 37.5%.
About Fiscal Correction
Centre should target a revenue surplus by 2014-15.
Combined debt of Centre and states should be capped at 68% of GDP by March
2015; currently at 82%.
In the case of macroeconomic shocks, Centre to borrow and devolve to states
instead of relaxing the state borrowing limits.
The medium term fiscal plan should be made a statement of commitment.
About the Goods and Services Tax
Single rate for goods services proposed.
To make, GST purely consumption based, taxes and cesses should be subsumed.
Petrol, diesel, alcohol, tobacco may be charged to GST with additional levies by
the Centre and states.
Only public services, unprocessed food items, health education and transactions
between employer and employee be exempted.

Highlights of 14th Finance Commission Report

Grant-in-aid for Revenue Deficit States (2015-2020)

States 2015-20(`crores)
Andhra Pradesh 22, 113
Assam 33, 79
Himachal Pradesh 40, 625
Jammu and Kashmir 59, 666
Kerala 9,519

Manipur
Meghalaya
Mizoram
Nagaland
Tripura
West Bengal
Total States
Criteria and Weights for Calculating
tax devolution
Criteria Weight (%)
Population 17.5
Demographic Change 10
Income Distance 50
Area 15
Forest Cover 7.5
GOVERNMENT ACCEPTS
14TH FINANCE COMMISSION
RECOMMENDATION FOR TAX
DEVOLUTION.
Major recommendations of
Fourteenth Finance Commission
(FFC) accepted by the government
States share in the net proceeds of
Union tax revenues increased to 42%
from 32% earlier. This is the largest
ever jump in percentage of devolution.
In the past, changes have ranged
between 1-2% increase.
Eight Centrally Sponsored Schemes
(CSS) delinked from support from the
Centre. Finance Commissin has identified
over 30 CSS schemes to be delinked from
Centres support but all have not yet
been delinked considering the national
priorities and legal obligations.
Sharing pattern under various CSS to
undergo a change, with States sharing
higher fiscal responsibility for scheme
implementation.
Distribution of grants to States for
local bodies based on 2011 population
35
10,227
1,770
12,183
18,475
5,103
11,760
1, 94,821
data (90% weight) and area (10%
weight)
Other key recommendations
of FFC that government will
examine
Revenue compensation to States under
GST should be for five years; 100%
in first three years, 75% in fourth year
and 50% in fifth year.
Create an autonomous and independent
GST Compensation Fund through
legislative actions to facilitate the
compensation process.
Suggesting a fiscal consolidation road
map, FFC puts a ceiling on fiscal deficit
at 3% of GDP from 2016-17 onwards.
Some flexible provisions for States
borrowings over and above the annual
limit of fiscal deficit at 3% of GSDP.
Establish an independent Fiscal Council
to undertake ex-ante assessment of
fiscal policy implications of budget
proposals and their consistency with
fiscal policy and rules.
Suitably amend Electricity Act 2003 to
facilitate levy of penalties for delays
in payment of subsidies by the state
governments.
Have independent regulators for
road sector for tariff setting, quality
regulation, among other functions.
Several recommendations made for
evaluating governments ownership,
disinvestment in Central Public Sector
Enterprises.

2. Administrative Reforms
Commission (ARC)
The Administrative Reforms Commission
or ARC is the committee appointed by the
Government of India for giving recommendations
for reviewing the public administration system
of India. The first ARC was established on
5 January 1966.The Administrative Reforms
Commission was initially chaired by Morarji
Desai, and later on K. Hanumanthaiah became
its chairman when Desai became the Deputy
Prime Minister of India.
The Second Administrative Reforms
Commission (ARC) was constituted on 31
August 2005, as a Commission of Inquiry,
under the Chairmanship of Veerappa
Moilyfor preparing a detailed blueprint for
revamping the public administrative system
1st ARC
Mandate
The first Commission was mandated to give
consideration to the need for ensuring the
highest standards of efficiency and integrity
in the public services, and for making public
administration a fit instrument for carrying
out the social and economic policies of
the Government and achieving social and
economic goals of development, as also one
which is responsive to the people. In particular
the Commission is to consider the following:
1. The machinery of the Government
of India and its procedures of work;
2. The machinery for planning at all
levels;
3. Center-State relationships;
4. Financial administration;
5. Personnel administration;
6. Economic administration;
7. Administration at the State level;
8. District administration;
9. Agricultural administration; and
10. Problems of redress of citizens griev-
ances.
36
Exclusions
The Commission may exclude from its purview
the detailed examination of administration
of defence, railways, external affairs, security
and intelligence work, as also subjects such
as educational administration already being
examined by a separate commission.
Recommendation
The Commission submitted the following
20 reports before winding up in mid-1970s:
1. Problems of Redress of Citizens
Grievances (Interim)
2. Machinery for Planning
3. Public Sector Undertakings
4. Finance, Accounts & Audit
5. Machinery for Planning (Final)
6. Economic Administration
7. The Machinery of GOI and its
procedures of work
8. Life Insurance Administration
9. Central Direct Taxes Administration
10. Administration ofUTs&NEFA
11. Personnel Administration
12. Delegation of Financial &
Administrative Powers
13. Center-State Relationships
14. State Administration
15. Small Scale Sector
16. Railways
17. Treasuries
18. Reserve Bank of India
19. Posts and Telegraphs
20. Scientific Departments
The above 20 reports contained 537 major
recommendations. Based on inputs received
from various administrative Ministries, a
report indicating implementation position
was placed before the Parliament in
November,1977.
2nd ARC
Composition:
Veerappa Moily- Chairperson
V. Ramachandran- Member

Dr. A.P. Mukherjee - Member
Dr. A.H. Kalro - Member
Jayaprakash Narayan - Member
Vineeta Rai - Member-Secretary
Veerappa Moily resigned with effect from 1
April 2009. V. Ramachandran was appointed
chairman. Jayaprakash Narayan resigned
with effect from 1 September 2007.
Mandate
The Commission was given the mandate
to suggest measures to achieve a proactive,
responsive, accountable, sustainable and
efficient administration for the country at all
levels of the government. The Commission
was asked to, inter alia, consider the following:
(i) Organisational structure of the Government
of India,
(ii) Ethicsingovernance,
(iii) Refurbishing of Personnel Administration,
(iv) Strengthening of Financial Management
Systems,
(v) Steps to ensure effective administration
at the State level,
(vi) Steps to ensure effective District Admini-
stration,
(vii) Local Self-Government/Panchayati Raj
Institutions,
(viii) Social Capital, Trust and Participative
public service delivery,
(ix) Citizen-centric administration,
(x) Promotinge-governance,
(xi) Issues of Federal Polity,
(xii) Crisis Management,
(xiii) Public Order
37
Exclusions
The Commission was to exclude from
its purview the detailed examination of
administration of defence, railways, external
affairs, security and intelligence, as also
subjects such as Centre-state relations, judicial
reforms etc
Working
The Commission will devise its own
procedures (including for consultations
with the State Government as may be
considered appropriate by the Commission),
and may appoint committees, consultants/
advisers to assist it. The Commission may
take into account the existing material
and reports available on the subject and
consider building upon the same rather
than attempting to address all the issues ab
initio. The Ministries and Departments of
the Government of India were to furnish
such information and documents and
provide other assistance as may be required
by the Commission. The Government of
India entrusted the State Governments
and all others concerned to extend their
fullest cooperation and assistance to the
Commission.
3. LAW COMMISSION
Law Commissions were constituted by the
Government from time to time and were
empowered to recommend legislative
reforms with a view to clarify, consolidate
and codify particular branches of law
where the Government felt the necessity
for it. The first such Commission was
established in 1834 under the Charter
Act of 1833 under the Chairmanship of
Lord Macaulay which recommended
codification of the Penal Code, the Criminal
Procedure Code and a few other matters.
Thereafter, the second, third and fourth
Law Commissions were constituted in

1853, 1861 and 1879 respectively which,
during a span of fifty years contributed
a great deal to enrich the Indian Statute
Book with a large variety of legislations on
the pattern of the then prevailing English
Laws adapted to Indian conditions.The
Indian Code of Civil Procedure, the
Indian Contract Act, the Indian Evidence
Act, the Transfer of Property Act. etc. are
products of thelabourof the first four Law
Commissions.
POST-INDEPENDENCE
DEVELOPMENTS
After independence, the Constitution of
India with its Fundamental Rights and
Directive Principles of State Policy gave a
new direction to law reform geared to the
38
needs of a democratic legal order in a plural
society. Though the Constitution stipulated
the continuation of pre-Constitution
Laws (Article 372) till they are amended
or repealed, there had been demands in
Parliament and outside for establishing a
Central Law Commission to recommend
revision and updating of the inherited
laws to serve the changing needs of the
country. The Government of India reacted
favourably and established the First Law
Commission of Independent India in 1955
with the then Attorney-General of India,
Mr. M. C. Setalvad, as its Chairman. Since
then twenty one more Law Commissions
have been appointed, each with a three-year
term and with different terms of reference.
The names of Chairman who presided over
these Commissions are given below:

Commission Duration Chairman

1. First Law Commission 1955-58 Mr. M. C. Setalvad
Former Attorney General of India
2. Second Law Commission 1958-61 Mr. Justice T. V. Venkatarama
Aiyar.
3. Third Law Commission 1961-64 Mr. Justice J. L. Kapur
4. Fourth Law Commission 1964-68 Mr. Justice J. L. Kapur
5. Fifth Law Commission 1968-71 Mr. K. V. K. Sundaram, I. C. S.

6. Sixth Law Commission 1971-74 Mr. Justice Dr. P. B. Gajendragadkar

7. Seventh Law Commission 1974-77 Mr. Justice Dr. P. B.
Gajendragadkar
8. Eighth Law Commission 1977-79 Mr. Justice H. R. Khanna
9. Ninth Law Commission 1979-80 Mr. Justice P. V. Dixit

10. Tenth Law Commission 1981-85 Mr. Justice K. K. Mathew

11. Eleventh Law Commission
12. Twelfth Law Commission
13. Thirteenth Law Commission
14. Fourteenth Law Commission
15. Fifteenth Law Commission
1985-88 Mr. Justice D. A. Desai
1988-91 Mr. Justice M. P. Thakkar
1991-94 Mr. Justice K. N. Singh
1995-97 Mr. Justice K Jayachandra Reddy
1997-2000 Mr. Justice B. P. Jeevan Reddy
 39

16. Sixteenth Law Commission 2000-2001 Mr. Justice B. P. Jeevan Reddy

2002-2003 Mr. Justice M. Jagannadha Rao

17. Seventeenth Law Commission 2003-2006 Mr. Justice M. Jagannadha Rao

18. Eighteenth Law Commission 2006-2009 Dr. Justice AR Lakshmanan

19. Nineteenth Law Commission 2009-2012 Mr. Justice P. V. Reddi

20. Twentieth Law Commission 2012-2013 Mr. Justice D. K. Jain

2013-2015 Mr. Justice A. P. Shah
21. Twenty first Law Commission 2015-2018 Justice Balbir Singh Chauhan

21st Law Commission Dr. Justice Balbir Chairman

Singh Chauhan
The Union Government has appointed
former Supreme Court (SC) judge Justice Mr. Justice Ravi Member
Balbir Singh Chauhan (66) as Chairman of R. Tripathi
the 21st Law Commission of India (LCI). Member
Currently he is Chairman of the Cauvery Member
River Water Disputes Tribunal. He was
Shri Suresh Chandra, Member
judge of the SC from May 2009 to July Law Secretary (Ex-Officio)
2014. He also had served as Chief Justice
Dr. G. Narayana Raju, Member
of Orissa high court from July 2008 to May
Secretary (Legislative) (Ex-Officio)
2009. Apart from him, Union Government
has appointed former judge of the Gujarat Dr. (Smt.) Pawan Secretary to
Sharma the Law
high court Justice Ravi R Tripathi as
Commission
member of 21st LCI.
The Commission is empowered to have five
Background: Union Government had part-time members depending upon the need
constituted 21st LCI for period of 3 years and on the Approval of the Government.
with effect from 1 September 2015 to 31 The Terms of Reference of the Twenty-first
August 2018. Law Commission are as follows:-
Composition: (i) Chairperson (full-time), A.Review/Repeal of obsolete laws:
(ii) Four Members (full-time). It will in- i.Identify laws which are no longer
clude a Member-Secretary. (iii) 3 Secretar- needed or relevant and can be
ies: Department of Legal Affairs, and Leg- immediatelyrepealed.
islative Department as ex officio Members. ii. Identify laws which are not in harmony
(iv) Up to 5 part-time Members. with the existing climate of economic
Recommendations: 21st LCI will give its liberalization and needchange.
major recommendations on a review of the iii. Identify laws which otherwise require
Indian Penal Code (IPC), the criminal jus- changes or amendments and to make
tice system and the bail law in order to en- suggestions for their amendment.
sure uniformity in the procedure of granting iv. Consider in a wider perspective the
the relief. suggestions for revision/amendment

given by Expert Groups in various
Ministries/Departments with a view to
coordinating and harmonizing them.
v. Consider references made to it by
Ministries/Departments through the
Department of Legal Affairs, Ministry
of Law and Justice in respect of
legislations having bearing on the
working of more than one Ministry/
Department
vi. Suggest suitable measures for
quickredressalof citizens grievances,
in the field of law.
B. Law and Poverty
i. Examine the Laws which affect the
poor and carry out post-audit for socio-
economiclegislations.
ii. Take all such measures as may be
necessary to harness law and the legal
process in the service of the poor.
C. Keep under review the system
of judicial administration to en-
sure that it is responsive to the
reasonable demands of the times
and in particular to secure:
i. Elimination of delays, speedy
clearance of arrears and reduction
in costs so as to secure quick and
economical disposal of cases without
affecting the cardinal principlethat
decisionshould be just and fair.
ii. Simplification of procedure to reduce
and eliminate technicalities and
devices for delay so that it operates not
as an end in itself but as a means of
achieving justice.
iii. Improvement of standards of all
concerned with the administration of
justice.
D. Examine the existing laws in the light
of Directive Principles of State Policy
and to suggest ways of improvement
and reform and also to suggest such
legislations as might be necessary to
implement the Directive Principles
40
and to attain the objectives set out in
the Preamble to the Constitution.
E. Examine the existing laws with a view
for promoting gender equality and
suggesting amendments thereto.
F.Revise the Central Acts of general
importance so as to simplify them and
to remove anomalies, ambiguities and
inequities.
G. Recommend to the Government
measure for making the statute book
up-to-date by repealing obsolete laws
and enactments or parts thereof which
have outlived theirutility.
H. Consider and to convey to the
Government its views on any
subject relating to law and judicial
administration that may be specifically
referred to it by the Government
through Ministry of Law and Justice
(Department of Legal Affairs).
I. Consider the requests for providing
research to any foreign countries as
may be referred to it by the Government
through Ministry of Law and Justice
(Department of Legal Affairs).
J. Examine the impact of globalization
on food security, unemployment
and recommend measures for the
protection of the interests of the
marginalized.
Report
The Reports of the Law Commission
are considered by the Ministry of Law
in consultation with the concerned
administrative Ministries and are
submitted to Parliament from time
to time. They are cited in Courts, in
academic and public discourses and are
acted upon by concerned Government
Departments depending on the
Governments recommendations.
The Law Commission of India has
forwarded262Reports so far on
different subjects.

EXERCISE
1 . Administrative Reform Commission
(ARC) give recommendation on
(a) administrative system
(b) law reform
(c) fundamental rights
(d) procedure of court
2. Chairman of 2nd ARC is
(a) Veerapa Moily
(b) Morarji Desai
(c) Pt Jawahar Lal Nehru
(d) Deepak Kapur
3. 2nd ARC kept excluded from its purview
are
(a) defence
(b) railway
(c) security and intelligence
(d) all of the above
4. Who among the following is not a part
of 2nd ARC.
(a) A.P Mukherjee
(b) Veerapa Moily
(c) Satish Reddy
(d) Jayaprakash Narayan
5. 1ST ARC was established on
(a) 5 Jan 1966 (b) 10 Jan 1969
(c) 31 Aug 2005 (d) 5 Jan 1986
6. 2nd ARC was established on
(a) 5 Jan 1966 (b) 10 Jan 1969
(c) 31 Aug 2005 (d) 5 Jan 1986
7. Law Commission is a
(a) constitutional body
(b) statutory body
(c) advisory body
(d) advisory and adhoc body
8. Chairperson of 21st Law Commission of
India is
(a) Balbir Singh Chauhan
(b) Mc Setalvad
(c) P Shah
(d) Pv Reddi
41
9. Chairperson of 1st Law Commission of
India is
(a) Mc Setalvad
(b) Balbir Singh Chauhan
(c) AP Shah
(d) Pv Reddi
10. Term of 21st Law Commission is
(a) 4 year (b) 3 year
(c) 2 year (d) 5 year
11. Who among the following has not been
chairperson of Law Commission
(a) Mr. Justice H. R. Khanna
(b) Mr. Justice K Jayachandra
(c) Mr. Justice P. V. Reddi
(d) H l Dattu
12. The first Law Commission during British
rule established under
(a) Charter Act of 1833
(b) Pitts India Act
(c) Montagu Chemsford Reform
(d) Indian Independence Act 1947
13. Whose duty is it to recommend to the
President of India on the issue of the
distribution and allocation of the net
proceeds of taxes in the context of
Centre-State fiscal relations?
(a) Planning Commission
(b) National Development Council
(c) Union Ministry of Finance
(d) Finance Commission
14. Match the List-I with List-II and select
the correct answer using the codes
given below the Lists.
List-I
A. Public Interest Litigation
B. Distribution of powers
C. Article 268-281
D. Article 280
List-II
1. No Plaintiffs no Defendants
2. Distribution of revenue
3. Finance Commission
4. Federal feature

Code
A B C D
(a) 2 4 3 1
(b) 2 4 2 3
(c) 3 4 2 1
(d) 1 2 3 4
15. Who among the following recommend
the Union Government that grant of
financial assistance to the Sates ?
1. The President of India.
2. The Comptroller and Auditor-
General of India
3. The Finance Commission
4. The Planning Commission
(a) 1 and 2 (b) 2 and 3
(c) 3 and 4 (d) 1 and 4
16. The role of the Finance Commission in
Centre-State fiscal relations has been
undermined by
(a) The State Government
(b) The Zonal Councils
(c) The Planning Commission
(d) The Elections Commission
17. Match the List-I (institutions) with
List-II (Article) of Constitution and
select the correct answer by using the
codes given below the lists
List-I
A. Comptroller and Auditor General of
India
B. Finance Commission
C. Administrative Tribunals
D. Union Public Service Commission
List-II
1. Article 315 2. Article 280
3. Article 148 4. Article 323(A)
Code
A B C D
(a) 3 4 2 1
(b) 1 2 4 3
(c) 3 2 4 1
(d) 1 4 2 3
18. Who among the following is responsible
for the final compilation of the accounts
of the Union Government
42
(a) Finance Minister
(b) Secretary (Finance)
(c) Controller General of Accounts
(d) Comptroller and Auditor General
19. Which one of the following statements
about the Finance Commission in India
is not correct?
(a) The Commission comprises a
Chairman and four other members
(b) The Parliament is authorized to
determine by law the qualifications
of the members of the Commission
(c) All the appointments are made by
the President of India
(d) All the members have to be form
Indian Economic Service or Indian
Statistical Service
20. Consider the following statements
The Finance Commission in India is
created
1. By the President of India on the
advice of the Union Cabinet.
2. Under Article 280 of the
Constitution of India.
3. To suggest ways and means to
augment the financial resources of
the Union and States.
4. To make recommendations to the
President defining the principles
which should govern the grants-in-
aid of the revenues of the states out
of the Consolidated Fund in India.
Which of the statements given above
are correct?
(a) 2, 3 and 4 (b) 1, 2 and 3
(c) 1, 3 and 4 (d) 1, 2 and 4
21. Consider the following statements
The Finance Commission of India is
differs from the Planning Commissions
because
1. The former is a constitutional body
and latter a Cabinet creation.
2. The former determines the
principles of allocation of grants-
in-aid to the states and the latter
allocated funds for the Central and
the State Government.

3. The former emphasizes the
distinction between plan and non-
plan expenditure and the latter
maintains it.
4. The formers report is submitted to
the Union Finance Minister and the
latters to the Cabinet.
Which of the statements given above is/
are correct?
(a) 1 and 2 (b) 3 and 4
(c) 2, 3 and 4 (d) 1, 2, 3 and 4
22. The Central Administrative Tribunal
deals with
(a) Recruitment matters
(b) Promotion matters
(c) Disciplinary matters
(d) Recruitment and all service matters
23. A new All India Service can be created
by
(a) A resolution of the Rajya Sabha
(b) An act of Parliament when Rajya
Sabha authorises by a resolution
(c) An order of the President
(d) A resolution of the UPSC
24. Which of the following are constituted
by the President?
1. The Finance Commission
2. The Planning Commission
3. The Commission of Official Languages
4. The Union Public Service Commission
Which of the statements given above is/
are correct?
(a) 1 and 2 (b) 3 and 4
(c) 1, 3 and 4 (d) 2, 3 and 4
25. The Veerappa Moily Commission is
its report on Administrative Reforms
among other aspects has suggested
doing away with which one of the
following pairs of Articles of the
Constitution of India?
(a) Articles 305 and 306
(b) Articles 307 and 308
(c) Articles 308 and 309
(d) Articles 310 and 311
26. Which of the following is a source of
income of the Gram Panchayats?
43
(a) Income tax
(b) Sales tax
(c) Professional tax
(d) Levy duties
27. The Administrative Reforms Commission
(1966), recommended the establishment
of Lokpal in India on the lines of
Ombudsman of which of the following
countries?
1. Finland 2. Denmark
3. Norway 4. Switzerland
Select the correct answer using the
codes given below:
(a) 1,2 and 4 (b) 1 and 2
(c) 1,2 and 3 (c) 3 and 4
28. The Institution of Ombudsman was first
introduced in:
(a) New Zealand (b) Norway
(c) Finland (d) Sweden
29. According to the Constitution of
India, it is the duty of the President
of India to cause to be laid before the
Parliament which of the following?
1. The Recommendations of the Union
Finance Commission
2. The Report of the Public Accounts
Committee
3. The Report of the Comptroller and
Auditor General
4. The Report of the National
Commission for Scheduled Castes
Select the correct answer using the
codes given below :
(a) 1 only (b) 2 and 4 only
(c) 1, 3 and 4 only (d) 1, 2, 3 and 4
30. Consider the following statements:
1. An amendment to the Constitution
of India can be initiated by an
introduction of a bill in the Lok
Sabha only.
2. If such an amendment seeks to make
changes in the federal character of
the Constitution, the amendment
also requires to be ratified by the
legislature of all the States of India.

Which of the statements given above is/
are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
31. Match List-I with List-II and select the
correct answer using the codes given
below the lists:
List-I (Publisher)
A. Ministry of Industry
B. Central Statistical Organisation
C. Reserve Bank of India
D. Ministry of Finance
List-II (Publication)
1. Report on Currency and Finance
2. Economic Survey
3. Wholesale Price Index
4. National Accounts Statistics
Codes:
(a) A-4, B-3, C-2, D-1
(b) A-3, B-4, C-1, D-2
(c) A-4, B-3, C-1, D-2
(d) A-3, B-4, C-2, D-1
32. In India, the interest rate on savings
accounts in all the nationalized
commercial banks is fixed by
(a) Union Ministry of Finance
(b) Union Finance Commission
(c) Indian Banks Association
(d) None of the above.
44
33. When the annual Union Budget is not
passed by the Lok Sabha ?
(a) The Budget is modified and
presented again
(b) The Budget is referred to the Rajya
Sabha for suggestions
(c) The Union Finance Minister is
asked to resign
(d) The Prime Minister submits the
resignation of Council of Ministers.
34. With reference to the Finance Commission
of India, which of the following statements
is correct?
(a) It encourages the inflow of foreign
capital for infrastructure development
(b) It facilitates the proper distribution
of finances among the Public Sector
Undertakings
(c) It ensures transparency in financial
administration
(d) None of the above
35. The Government of India has established
NITI Aayog to replace the
(a) Human Rights Commission
(b) Finance Commission
(c) Law Commission
(d) Planning Commission

HINTS & EXPLANATIONS
1 . (a) 2. (a) 3. (d)
4. (d) 5. (a) 6. (c)
7. (d) It is truly an ad hoc and advisory
body whose work is to do research
and make recommendations for
law reforms such as amendments
and updations of prevalent and
inherited laws. None of these
recommendations is binding upon
the Government.
8. (a) 9. (a) 10. (b)
11. (d) Handyala Lakshminarayanaswamy
Dattu (born 3 December 1950) is a
former Chief Justice of India(CJI), and
the current chairman of theNational
Human Rights Commission
12. (a) The first such Commission was
established in 1834 under the
Charter Act of 1833 under the
Chairmanship of Lord Macaulay.
13. (d) 14. (b) 15. (c) 16. (c) 17. (c)
18. (c) 19. (d) 20. (d) 21. (a) 22. (d)
23. (b) 24. (c) 25. (d) 26. (d) 27. (c)
28. (d)
29. (c) It is not the duty of the President of
India to cause to be laid report of
public Accounts Committee before
the Parliament.
30. (d) An amendment to the constitution of
India is introduced as a bill in the
Parliament. It then must be approved
by both the houses of Parliament. The
amendments must then be ratified by
the legislatures of at least one half of
the states (not all the states). Once
all these stages are complete the
amendment is bound to receive the
assent of the President of India.
31. (b) Union Government of India
32. (d) It is fixed by Reserve Bank of
India. In 2011, RBI permitted the
commercial banks to fix interest rate
on saving account independently.
45
Rate of interest up to ` 1 lakh has to
be same for every bank.
33. (d) If annual Union Budget is not passed
by the LOK SABHA, it is tantamount
to no confidence motion. So the Govt
submits the resignation of his Council
of Ministers.
34. (d) The Commission shall make
recommendations as to the
following matters, namely :
(i) 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 Chapter
I Part XII of the Constitution and the
allocation between the States of the
respective shares of such proceeds;
(ii) The principles which should govern
the grants-in-aid of the revenues of
the States out of the Consolidated
Fund of India and the sums to be
paid to the States which are in need
of assistance by way of grants-in-aid
of their revenues under article 275 of
the Constitution for purposes other
than those specified in the provisions
to clause (1) of that article; and
(iii) The measures needed to augment
the Consolidated Fund of a State
to supplement the resources of the
Panchayats and Municipalities
in the State on the basis of the
recommendations made by the
Finance Commission of the State.
35. (d) The Government of India has
established NITI Aayog to replace
the Planning Commission. The
announced formation of NITI
Aayog on 1 January 2015 and the
first meeting of NITI Aayog was
held on 8 February 2015.