N-11019/108/2006-Pol.I(Vol.

II) Ministry of Panchayati Raj

Date: 19th March, 2010

Subject: Revised Note on Decentralised Governance in the North Eastern States (NE) 1. Background 1.1 The Second Administrative Reforms Commission (ARC in brief) in its Seventh Report (Feb 08) entitled Capacity Building for Conflict Resolution has especially dealt with Conflicts in the North East (NE) in Chapter 12. Besides dealing with the general theme of capacity building in administration, the ARC has focused particularly on three aspects of Local Government Institutions (LGIs), namely (i) Autonomous District Councils (Council in brief) in the Sixth Schedule areas, (ii) Village level self governance therein, and (iii) Tribe specific Councils in Assam. The relevant recommendations are listed in Thematic Appendix 1A. 1.2 The Ministry of Panchayati Raj (MoPR) had appointed an Expert Committee (Committee in brief) chaired by Shri V. Ramachandran (an ARC member) in 2006 for examining in detail functioning of the self-governing institutions under the Sixth Schedule. The Committee submitted its Report in Sept. 2007. The major policy issues of self-governance dealt by the Committee are naturally subsumed in the ARC recommendations. State-wise recommendations of the Committee on general administration including finance, accounts and audit are listed in Thematic Appendix 1B. 1.3 The relevant recommendations of the Third Report of the Standing Committee on Institutional Issues relating to Tribal Development on Standards of Administration and Governance in the Scheduled Areas with Dr Mungekar as Chairperson (Feb. 2009) have also been incorporated in the proposals ( See Thematic Appendix 1C). 1.4 The NEHU Report (2008) has also been considered that has provided some factual position on the ground. 2. Ideal and Reality of LGIs in Tribal Areas 2.1 Article 244 of the Constitution (Annexure 2) envisages three categories of Tribal Areas, namely, (i) areas listed as Tribal Areas in the Sixth Schedule in NER, (ii) areas notified as Scheduled Areas in the specified States, and (iii) areas not covered in the above two categories. While the Sixth Schedule concerns Administration of Tribal Areas, the Fifth
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Schedule relates to Administration and Control of Scheduled Areas and Scheduled Tribes. There is no special schedule for the rest (Annexure 3&4). 2.2 Each tribal area mentioned in Para 20 of the Sixth Schedule is designated as an autonomous district. The area inhabited by each of the tribes in a district may be carved out as autonomous region. Each autonomous district is governed by a District Council (Council in brief) and autonomous region by a Regional Council. This unique Council frame comprises the third tier of legislature for Tribal Areas about matters specified in Para 3 of the Sixth Schedule. These Councils, endowed with legislative, judicial and executive powers, virtually function as state within state(See Thematic Appendix 3 & Annexure 6). 2.3 This ideal Constitutional frame has remained rather ineffective. As noted in NEHU study (2008), most of the Councils could not even constitute village bodies and where constituted, they remained ineffective except in mixed areas like Tripura. Similarly formal Courts have little work to do in the face of effective traditional system. The Councils have been formally assigned developmental functions as well. They are, however, quite diverse, for example, from the bare minimum functions for Councils in Meghalaya to extensive functions in Bodoland. There is, however, general resistance to this function of District Councils from the State Departments. 2.4 Perhaps considering this big gap between the ideal and the reality of self-governance that Governors Conference (September, 2008) recommended Dispense with District Councils in some NE States and introduce Panchayati Raj system for better development. Given the sensitivity and ground reality of NE, abolition of Councils may not be a feasible or even desirable option. 2.5 The ARC and also the Expert Committee in this context have commended the Provisions of Panchayats (Extension to the Scheduled Areas) Act, 1996, (PESA) (Annexure 1) as land mark legislation. The experience there-of can be a dependable guide in resolving some of the vexed issues, especially harmonizing the traditional-formal interface, that have rendered the Sixth Schedule virtually non-functional. 2.6 Part IX of the Constitution basically specifies the structural aspects of local administration. So far as endowment of powers and assignment of functions to the local bodies are concerned, Part IX abides by the scheme of Seventh Schedule. Art 243A leaves the endowment of powers etc to the Gram Sabha to the State Legislatures. In the case of Panchayats, however, Art 243G specifies some items including those in the 11th Schedule that may be entrusted to the Panchayats by the State Legislatures in their discretion.
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2.7 Art 243M (4) makes a major departure from the above position about extending provisions of Part IX to the Tribal and Scheduled Areas. The Parliament is empowered to make any exceptions and modifications therein Notwithstanding any thing in this Constitution. But the Parliament did not invoke this power while enacting PESA. It preferred to outline the basic features of self governance in Section 4 of PESA and constrained the State Legislatures from making any law that is inconsistent with those features. These features are unique in the realm of village governance. (See Para 20A of Thematic Appendix 5A, Annexure5) 3. The Constitutional Frame of LGIs in NE The legal frame of LGIs in NE broadly comprise three typologies, viz., (i) Sixth Schedule Frame (Meghalaya, parts of Assam, Mizoram and Tripura), (ii) State Legislation Frame (Nagaland and non-Council Areas in Mizoram), and (iii) National Frame (Arunachal Pradesh, Sikkim, Manipur excluding hill areas and non-Council areas in Assam and Tripura). Accordingly different Constitutional measures will be necessary for any reform in the specific context of each State. (See details in Part 3 of Thematic Appendix 2) 4. The Broader North Eastern Perspective The recommendations of the Commission and Committees have to be considered in the larger context of self-governance in NE. For example, there is compelling need to balance security, tribal identity and institutions, economic development and natural resource management. Various attempts for achieving needed balance became infructuous because of the complex structures, overlapping jurisdictions, ad hoc decisions and non-implementation of agreements even when embodied in the Constitution. Important features of NE that must be taken in account are given in Thematic Appendix 2A. 5. Frame for Dealing with ARC Recommendations and other Key Issues The consideration of self-governance issues that follows, cover the ARC recommendations and other key issues, under two broad sections, viz, A. Realigning Relevant Constitutional Provisions, and B. Issues for Further Dialogue. Part A 6. Realigning Relevant Constitutional Provisions 6.1 The issues that require realigning relevant Constitutional provision(s) are briefly presented here. The relevant ARC/Committee recommendation(s) is (are) mentioned at the end. A
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detailed write-up on some issues, where necessary, is given in the related Thematic Appendix. The proposed Constitutional amendments are given in Constitutional Appendices 1 to 3. (i) Governance at the Village level in NE 6.1.1 The traditional self governing village institutions are strong throughout NE especially in tribal territories. But the formal institutions such as the Village Council or Gram Sabha under various State laws including the Sixth Schedule are rather weak. Accordingly, the traditionalformal impasse continues (Para 2.3). This issue has been resolved under PESA in the Scheduled Areas (Para 2.5 & 2.6). In NE, Nagaland has taken some ingenious measures in Village Council Act, 1978. But there are some inherent anomalies therein like the Village Development Board (VDB), analogous to the Gram Sabha, being answerable to traditional Village Council (which is not a elected body) and an official functioning as its chairman (see comparative Statement of Nagaland Village Council Act and PESA in Part 4 of Thematic Appendix 2 Part 4 ). They have to be remedied in keeping with the spirit of rising democratic aspirations (see Thematic Appendix 5). 6.1.2 This traditional versus formal impasse is equally pervasive in Council Areas and other tribal territories in NER. The core elements of PESA frame can be adopted as a model for resolving the prevailing anomalous situation in NER. Accordingly, Schedule 6 may be suitably amended to empower Gram Sabhas in Council Areas as in PESA. These provision empowering Gram Sabha in the Sixth Schedule should be extended to the non-Council Areas in all the NE States by amending Article 243A and adding a new Schedule 13 to the Constitution regarding powers and functions of Gram Sabha. At the same time, democratic Village Councils, with the option for election of Village Councils as per prevailing customary practices if the Gram Sabha so decides, may be promoted, and an option for intermediate tier may be created. Provisions for reservations for Scheduled Tribes etc. may be made in accordance with the provisions in PESA, and for women in accordance with the proposed 50% reservation in Panchayats. The mode of elections to all Councils may be brought in alignment with those in Part IX of the Constitution for Panchayats and entrusted to the State Election Commissions. The Councils may be empowered to undertake developmental functions as per the Eleventh and Twelfth Schedule of the Constitution. Other issues such as the powers of Panchayats throughout NE would be taken care of in the amendments to Part IX of the Constitution for the country as a whole, being proposed separately. (ii) Urban Bodies in Tribal Areas 6.2 Local Government in general areas comprises of two parts, i.e., Panchayats (Part IX) and Municipalities (Part IXA). But the jurisdiction of Councils in the Sixth Schedule is unified. This unified Council frame should continue. In fact, as envisaged in PESA and recommended by the ARC in its Report on LSG, the Sixth Schedule Council pattern could be
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followed in the whole country. The biggest challenge that people face in urbanization is from (i) initial adverse forces in the 'transitional areas', and (ii) the backwash effect around industrial/mining ventures. A provision should be made to identify both these special categories of urbanizing areas in the Sixth Schedule and effective protection of tribal interests. A provision should also be made for reservation of (i) not less than 50% seats and (ii) all the office, of Chairperson in all urban bodies in Tribal Areas for Scheduled Tribes and (iii) 50% seats and offices of chairpersons should be reserved for women (see Thematic Appendix 7, Constitutional Appendix 1). (iii) District Council and District level Planning 6.3 Article 243ZD in Part IXA of the Constitution envisages constitution of a District Panning Committee (DPC) at the district level. However Part IXA at the moment does not apply to the Scheduled and Tribal Areas. Accordingly a provision should be made in the Sixth Schedule to the effect that District Council itself, or sub Committee thereof, should also be the DPC where Council covers a whole district. In case a Council covers more than one district, the DPCs of the districts concerned should be mandated to function under the guidance of the Council. If the Council covers less than one district, there should be appropriate representation of the Council in the DPC of that district. 6.4 With due recognition of their being Councils prior to the creation of Mizoram State, the legislative powers of the three Councils in Mizoram can be enlarged as in Para 3A of the Sixth Schedule to bring them at par with North Cachar and Karbi Anglong, apart from endowing the three Mizoram Councils with all powers under Paragraphs 3A and 3B of the Sixth Schedule and 11th and 12th Schedules. (iv) Raising the level of administration of the Tribal and Scheduled Areas 6.5 Article 275 (1) underwrites the cost of raising the level of administration of Scheduled Areas and Tribal Areas to that of the rest of the State concerned by the Union Govt. NE has a special problem with regard to Assam as the reference State because of the changing status of different areas within the erstwhile Assam. This anomaly should be made good by (i) a provision for raising the level of administration of the entire Tribal Area in NER to the general level in NER, and (ii) preparing a 10 years perspective plan with annual action plans with the approval of Government of India, for raising the level of administration in all Tribal Areas to the rest of the country, taking advantage of other area schemes as well. Separate annual plans for raising the level of administration should be prepared by the States concerned under the guidelines of MoTA along with the developmental plan. (See for details Thematic Appendix 4 and Constitutional Appendix 3) (v) District Councils and State Finance Commissions (SFCs):
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6.6 The Committee has noted that some States that are outside the purview of Part IX have not established SFCs. To ensure due consideration towards the finances of LGIs in the region, the Governor may be empowered to set up a State Finance Commission with terms of reference as in Art. 243I for reviewing the financial position of Panchayats and recommending devolution of funds thereto from the State. (vi) District Council, State Government, Common Commission and Governor 6.7.1 Governor is the final authority on administration of Tribal Areas in the Sixth Schedule. He is answerable to the President. But there is no provision for Governors Report as in the Fifth Schedule. The Sixth Schedule has a provision for appointment of Commissions by Governors to report about the administration in Tribal Areas. ARC has recommended (Item 12d) to amend this Schedule to enable the Union to appoint a common Commission for all NE Tribal Areas. Instead of making a provision in the Sixth Schedule, Article 339 (1) should be amended to include Tribal Areas in its terms of reference (See Thematic Appendix 8, Constitutional Appendix 3 and Annexure 6 & 7). 6.7.2 The Governor in the new frame will have a central role to play. The Union Govt. must remain well informed about the state of administration and ensure concurrent corrective measures. A provision should therefore, be made in the Sixth Schedule for Governors Annual Report to the President (See Thematic Appendices 8, Constitutional Appendix 1). Part B 7. Issues for Further Dialogue 7.1 The ARC and other reports have thrown up a number of issues including the roles of and inter-relationship amongst, various institutions in the NER, State-Council relations, administrative reforms, needed improvement in finance, accounts and audit etc. There are also other issues that need to be addressed such as those related to the Forest Rights Act and new issues may emerge from time to time. It is proposed that a High Powered Committee comprising MoPR, MHA, MoTA, MoE&F, DoNER, Planning Commission and MoF, besides prominent public men be set up to address issues outlined below, and those that may emerge from time to time. (i) State-Council Relations and establishment of more Councils (Items 12 b, 12c) 7.1.1 The ARC has underlined the need for further dialogue amongst the Councils, the State Governments and the Union about the strained State-Council relations. Some States like Meghalaya and Mizoram consider the very concept of Councils as redundant. The other issues include enlarging the legislative domain and further delegation of powers to Councils in Mizoram, demand for establishing Councils in Arunachal Pradesh, Tribal Area status for hill
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areas in Manipur, establishment of tribe specific Councils in Assam and direct Central assistance to the Councils. An important issue is whether the Governor should act on the advice of Council of Ministers in the Council matters. 7.1.2 3 Councils covering whole of Meghalaya is not a very comfortable situation. However, it may not be feasible to abolish these Councils. 7.1.3 GoI has not accepted the proposals for establishment of Autonomous Councils in Arunachal Pradesh, and tribe-specific Councils in Assam since Councils have not led to effective basic changes in local governance in NE States and created tension with the State Councils (Thematic Appendix 6). 7.1.4 Council status for hill areas of Manipur would not be desirable or feasible since their area covers 9/10th of the geographical area of the State and this could leads to conflict between the Council & the State Government. The purpose of self-governance could be served by empowering the Gram Sabha and Panchayats. (ii) 7.2 Administrative & Financial Reforms 7.2.1 The new opportunity of strengthening self-governing institutions in NE should be used for basic administrative reforms. The uniqueness of small-sized States should be harnessed in terms of simpler systems with drastically reduced hierarchy engendering greater opportunities for closer interaction between the people and the administration (See Thematic Appendix 10). 7.2.2 The Ramachandran Committee has made some state wise recommendations (See Thematic Appendix 1B) regarding finance, accounts and audit. The implementation of these recommendations should be incorporated in the Governors annual reports on the Administration in Tribal Areas. 7.2.3 Direct transfer of funds to Councils would not be desirable, given the federal structure of the Country. But State Governments may be mandated to follow an efficient and transparent system of fund transfer as has been outlined in MoPRs advisory dated 23.02.2010 (Annex 8). (iii) 7.3 Forest Rights Act: (Item 1 h) The Scheduled Tribes and other Traditional Forest Dwellers (Recognition of Rights) Act, 2006 (FRA) is a landmark law about tribal rights in forests. This Act, however, does not extend to the Tribal Areas in the Sixth Schedule, except in small stretches of Reserved Forests therein, if any. This law also has far reaching implications for extensive Non-Council Areas in NER.
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There are some crucial matters like shifting cultivation, operationalisation of ownership of Minor Forest Produce and powers of Gram Sabha to protect forests that have not been duly considered so far. The High Powered Committee should study the situation in NE, especially the above mentioned issues and report within 3 months (see Thematic Appendix 9 for details). (iv) 7.4 Role of and inter-relationship amongst MoPR, MoTA, DoNER, NEC, ISC, NCST and NEHU in NER (Items 5h, 15 d, e & h, 16e, 22a, 23a) 7.4.1 The ARC and other Reports have thrown up a number of issues about the roles of and inter-relationship amongst, various institutions concerning the NE. The ARC has even recommended abolition of DoNER. Seven major institutions noted above are responsible for various administrative and developmental tasks. They must work in unison especially when the basic structural change in administration in the form of an effective self-governing system is being developed in NE. 7.4.2 The scope of direct involvement of MoTA in the affairs of Tribal Areas in the Sixth Schedule has been limited in the context of limited Central role therein. In the new frame, especially with the introduction of Governors annual reports to the President, this would change. 7.4.3 The NEC is a prestigious body with all NE Governors and Chief Ministers as its members. Inter-State disputes, therefore, should get resolved in the NEC parlays. The need for ISC intervention, if at all, will be rare. The very presence of ISC, however, should serve as a distant monitor. The NEC with direct link with the DPCs below and Planning Commission above, should function as the Chief Advisor of DoNER as also its representative in NER. NEC should function as the Planning Commission for the NER. NEC should also promote, and where necessary establish, Regional Training Institutes of excellence in the required disciplines. 7.4.4 All the three reports under consideration are unanimous that the key to development with equity, peace and harmony lies in the effective self-governance. The role of MoPR along with MoTA and MHA in this situation is central. It should be responsible for providing institutional support for promoting simple governance and legal frame, its dissemination, effective administration, concurrent monitoring coupled with effective incentives and disincentives. 7.4.5 The presence of NCST in NE is rather weak. Its focus should shift from individual complaints to the issues of Constitutional mandate. NCST should have a well-equipped field unit for NER at Shillong, where NEC is located.
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7.4.6 NEHU should develop as a Center of advanced study in various disciplines. All Central Universities in NER must work in unison. A Council of North-Eastern Universities (CoNEU) should be established for this purpose. NEHU should serve as the Convener of CoNEU (see for details on all the above points Thematic Appendix 11). 8. Decisions required A. Amendments in the Sixth Schedule and relevant Articles in the Constitution besides adaptation of State Panchayat laws (Details in Constitutional Appendices 1-3) for reinforcing self-governance in NE States as follows--8.1 (a) (i) Council Areas: Laying the framework of self-governance in Sixth Schedule areas by: taking out traditional Village Council from legislative jurisdiction of District Council, and making it a Constitutional imperative; constitution of Village Councils by direct election or as per prevailing customary practices if the Gram Sabha so decides by 2/3rd majority; constitution of elected Municipalities in urban areas; adoption of powers and duties of the Gram Sabha as per PESA template; option for constitution of elected Intermediate Councils in States with a population above 20 lakhs; mandatory reservations for Scheduled Tribes and women in all Councils; superintendence, direction and control of State Election Commission over elections to all Councils and Municipalities; and devolution of powers for socio economic development as envisaged in the 11th and 12th Schedule to the Councils and Municipalities (Para 6.1.1 & 6.1.2 with details in Theme Appendix 5 & Constitutional Appendix 1); 8.2 (ii) Councils in Mizoram: Enlarging the legislative domain of the three Councils in Mizoram as in Para 3A of the Sixth Schedule; (Para 6.4 and Constitutional Appendix 1). 8.3 (b) Non-Council Areas in NER 8.3.1 Empowering Gram Sabhas in Non-Council Areas in all NE States: Adding a Provision in Article 243A to the effect that the rights, duties and powers of Gram Sabha shall be as per Schedule 13 to be added to the Constitution (Para 6.1.2 and Thematic Appendix 5A). 8.3.2 (ii) Hill Districts of Manipur: Amending sub-clause (2) of Clause 4 of Article 243M authorizing Parliament to extend the provisions of Part IX to the hill districts (See Thematic Appendix 5A, Constitutional Appendix 2); 8.4 (c) Other Aspects of Governance 8.4.1 (i) Urban Bodies / Municipalities: Reinforcing the unified (rural & urban) District Council frame of the Sixth Schedule with amendments to ensure (i) equitable sharing of benefits of development, (ii) effective protection of tribal interests especially in the
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transitional areas and Zones of Urban Influence, and (iii) reservation of not less than 50% seats and all positions of Chairpersons in urban bodies in Tribal Areas for STs (See Para 6.2, Thematic Appendix 7, Constitutional Appendix 1); 8.4.2 (ii) District Planning Committees: Designating the District Council as District Planning Committee in single District Councils mandating DPCs in multi-district Councils to function under its guidance, and providing for appropriate representation of Councils covering less than one district in the DPC. (See Para 6.3, Constitutional Appendix 1); 8.4.3 (iii) Raising the level of Administration: Amending Article 275(1) for renewed commitment for (a) raising the level of administration in all Tribal Areas to the level of entire NER and (b) widening the perspective of raising the level of administration of all Tribal Areas in the country to the national level within a decade or so by preparation to a 10 year perspective plan and annual action plans in consultation with Government of India (See Para 6.5, Constitutional Appendix 3); 8.4.4 (iv) State Finance Commissions: Empowering the Governor of those States that have not constituted State Finance Commissions to set up State Finance Commissions, with terms of reference as in Article 243I (See Para 6.6); 8.4.5 (v) Enquiry about Administration: Amending Article 339(1) to add Tribal Areas therein enlarging the jurisdiction of the Commission appointed by the President periodically under this Article to report about the administration of the Scheduled Areas. (See Para 6.7.1, Thematic Appendix 9, Constitutional Appendix 3); 8.4.6 (vi) Governors Report to President: extending executive power of the Union to Tribal Areas in the Sixth Schedule and establishing an effective link through Governors Annual Report to the President on their administration, as in the Fifth Schedule (See Para 6.7.2, Thematic Appendix 8, Constitutional Appendix 1); 8.4.7 (vii) Accounts and Audit: Making it mandatory for Village, Intermediate Councils and Municipalities also to follow the guidelines of the Comptroller and Auditor General of India regarding accounts and audit (Para 7.2 & Constitutional Appendix 1). 8.5 B. Issues for further dialogue Constitution of a high powered Committee comprising representatives of MHA, MoPR, Planning Commission, Ministry of Finance, MOTA, MoE&F and DoNER besides prominent public men to make recommendations, among others, on the following issues:
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8.5.1 (i) State and Council Relations and establishment of more Councils: relationship between the Councils and State Governments about the issues that remain unresolved ; dialogue with concerned Governments and Councils regarding the need of tribe specific Councils and their role in the context of proposed empowerment of self-governing village institutions (See Para 7.1, Thematic Appendix 6); 8.5.2 (ii) Administrative and Financial Reforms: Administrative reforms in the NER aimed at a simpler system with reduced hierarchy in smaller States and of direct interface between the people and the administration; Forwarding State wise recommendations of Ramachandran Committee regarding finance, accounts and audit for necessary action and report (See Para 7.2). 8.5.3 (iii) Forest Rights: examining implications of non-application of Forest Rights Act to non-reserved forests in Sixth Schedule Tribal Areas and lack of a clear position about jhoom, ownership of MFP especially bamboo and powers of Gram Sabha to protect forest (See Para 7.3); 8.5.4 (vi) Role of and interrelationship among key institutions: Clear articulation of the role of MoPR, MoTA, DoNER, NEC, ISC,NCST and NEHU in NER and organic inter-relations amongst them for meeting the current challenges and achieving the national goals (See Para 7.4). 9. Views of Ministries / State Governments 9.1 While considering the recommendations of the ARCs Seventh Report titled Capacity Building for Conflict Resolution, the Core Group on Administrative Reforms headed by the Cabinet Secretary had stated that these issues would be considered in detail in the CoS on the basis of a note to be circulated by MoPR. MoPR had circulated a draft note on Decentralized Governance in the North-East, which was also discussed in interMinisterial meetings held on 8th July, 2009 and 12th August, 2009. On the basis of these discussions, the CoS Note was refined further and re-circulated on 18th November, 2009, to the Ministries and State Governments indicated in Annex 9A. Responses received and MoPRs response are summarized below and details are at Annex 9B & C. 9.2 Ministry of DoNER and Department of Land Resources have supported MoPRs proposals, and have suggested that the States be consulted. It may be noted that the CoS Note has been circulated to the State Governments. Further consultations will be undertaken once a view is firmed up at the Union level.
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9.3 Ministry of Tribal Affairs has stated that they support the need to have an administrative and financial structure to lay down the extent of autonomy of Autonomous Councils, and have also pointed out the likely mis-match between hereditary traditional structures of North East Councils vis--vis provisions of Part IX and Part IXA of the Constitution. It may be noted that MoPRs proposal does not mechanically apply provisions of Part IX & IXA to the NE region, but has been adapted to the specific conditions in the area to promote grassroots democracy. 9.4 Ministry of Home Affairs (MHA) has stressed the need for further dialogue with the States, which is proposed as indicated above. Several features of MHAs Note on Sixth Schedule Areas have been incorporated, as may be seen at Annex 8C. These include composition of Village Councils on the basis of adult suffrage, provision for Intermediate Councils, Rule making powers to District / Regional Councils regarding constitution of Village & Intermediate Councils and Municipalities, constitution of State Finance Commissions, powers to Councils / Municipalities as per Schedule XI and XII of the Constitution etc. 9.5 The Planning Commission has supported MoPRs proposal, except for the establishment of a separate State Finance Commission. However State Finance Commissions are proposed to be set up only in States where these have not already been set up. 9.6 The Ministry of Urban Development has stated that consultation with State Governments may be considered as Local Government is a State subject. MoPRs views are as per (9.2) above. 9.7 Government of Sikkim has supported MoPRs proposal. 10. The NE region is highly sensitive, and the CoS Note spans issues across several Ministries. It is essential that there be an internal consensus within the GoI among various Ministries before further dialogue with the States. Approval of the CoS is solicited for proposals contained in para 8 of the Note.

(A.N.P. Sinha) Secretary (PR)

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Constitutional Appendices Constitutional Appendix 1 Proposed Constitutional Amendments Amendment in the Sixth Schedule Ref.para 8.1, 8.2, 8.4 8.3 Page no. 17

Amendments in Part IX (Exempted Areas in Article 243M) Amendments in Other Articles (Article 275) Thematic Appendices

27

8.4.3

28

1A

Recommendations Commission

of

the

Administrative

Reforms

1.1

30

1B 1C 2.

State wise Recommendations of Ramachandran Committee Recommendations of Dr Mungekar Committee Status of North-Eastern States with regard to Self-Governing Institutions The Broader North Eastern Perspective Administration of Tribal Areas under the Sixth Schedule Raising the level of Administration of Scheduled and Tribal Areas Governance at the Village level-1: Council Areas Governance at the Village level-2: General and Scheduled Areas Tribe specific Councils in Assam and new Councils in Arunachal

1.2 3 3

35 38 39

2A 3. 4.

4 2.2 6.5

45 47 49

5. 5A.

6.1.1 2.7

51 54

6.

7.1.3

65

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7. 8. 9. 10. 11.

Urban Bodies in Tribal Areas District Council, State Government and the Governor Forest Rights Act Reduced hierarchy & simpler system Inter-relationship amongst National and Regional bodies in NER Annexures PESA Relevant Constitutional Provisions The Fifth Schedule Abstract of the Sixth Schedule Legislative Jurisdiction in Seventh Schedule Autonomous District/Regional Councils Role of Governor under Sixth Schedule Efficient & simple Financial Management System and online transfer and tracking of funds Status of responses received from Ministries / State Governments Summary of responses received and MoPRs comments Comments of Ministries on revised draft note for CoS on Decentralised Governance in North Eastern States

6.2 6.7.1 7.3 7.2.1 9.6

67 70 73 74 75

1 2 3 4 5 6 7 8

2.5 2.1, 2.6 2.1 2.2 2.7 2.2 6.7 7.2.3

83 87 95 98 101 102 106 107

9A

110

9B 9C

9 9

111 117
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Constitutional Appendix 1 Amendments in the Sixth Schedule 1. A new Paragraph 1A may be added in the 6th Schedule defining the basic village level institutions on the same lines as in PESA for the Scheduled Areas 1A Definitions In this Schedule, unless the context otherwise requires,-(a) Gram Sabha: Gram Sabha means a body consisting of persons whose names are included in the electoral rolls of the village within the area of the Village Council. (b) Intermediate Council: Intermediate Council means an institution of self government constituted below the district level as per para 2 of the Schedule. (c) Municipality: Municipality means an institution of self government in urban areas constituted as per para 2 of the Schedule. (d) Village: Village means a habitation or a group of habitations or a hamlet or a group of hamlets comprising a community and managing its affairs in accordance with its traditions and customs. (e) Village Council (by whatever name called amongst different communities): Village Council means an institution elected by villagers on the basis of adult suffrage or in accordance with the prevailing customary practices and usages as provided for in para 2 of the Schedule. 2. Paragraph 2 shall be amended as follows:

(a) After the sub-para (2) of para 2 the following sub-para 2(i) shall be substituted, namely: (i) The rural area of an Autonomous District or Region shall be constituted into Village Councils for a village or a group of villages. All seats in the Village Council shall be filled by persons chosen by direct election.
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(ii)

Provided that the Gram Sabha, if it so decides with a two thirds majority of the total electors in the village, may elect the Village Council in accordance with its prevailing customary practices. (iii) The Governor, in consultation with the Autonomous District/ Regional Council, shall notify an area as an urban area of appropriate category as envisaged in Article 243Q. There shall be constituted in all urban areas Municipalities as envisaged in Article 243Q. Intermediate Councils may be constituted in a State having a population exceeding 20 lakh by the Governor in consultation with the District or Regional Council as the case may be. All seats in Intermediate Councils, if constituted, shall be filled by direct election.

(iv)

(v)

(vi) (b)

The following 2 (6) (i) may be added to Para2 (6).

The Governor, in consultation with the District or Regional Council, as the case may be, shall make rules to provide for (i) (ii) the number of Village Councils to be constituted; the composition of the Village and Intermediate Councils and Municipalities and the allocation of seats therein;

Provided that seats shall be reserved for communities as indicated in Part IX &IXA of the Constitution as nearly as may be in proportion to their population where the proportion of population of the reserved community is not less than 5%; Provided further that the reservation for the Scheduled Tribes shall not be less than one-half of the total number of seats; And provided further that not less than one half seats in the Village and Intermediate Councils and Municipalities shall be reserved for women. (iii) the manner of election of chairpersons to the Village, and Intermediate Councils and Municipalities.
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Provided that not less than one half of offices of chairpersons in Village and Intermediate Councils and Municipalities shall be reserved for women by rotation. Provided further that all offices of chairpersons of Village and Intermediate Councils and Municipalities where the proportion of Scheduled Tribes is 5% or more, shall be reserved for the Scheduled Tribes. (iv) The District or Regional Council as the case may be shall make rules as to the delimitation of territorial constituencies for the purpose of election to Village and Intermediate Councils and Municipalities.

Provided that the ratio between the population of the territorial area of the Village and Intermediate Councils and Municipalities and the number of seats in the Village and Intermediate Councils and Municipalities to be filled by election shall, so far as practicable, be the same throughout the autonomous districts/regions. (v) The District or Regional Council, as the case may be, shall make rules with respect to any other matter related elections and nominations to Village and Inter-mediate Councils and Municipalities not specified in this Schedule.

(c)

In paragraph 2, for sub-paragraph 6(A) the following sub-paragraph shall be substituted, namely:(i) Every Council constituted under this Schedule, including a District, Regional, Village and Intermediate Council and a Municipality, unless sooner dissolved under any law for the time being in force, shall continue for five years from the date appointed for its meeting and no longer; (ii) No amendment of any law for the time being in force shall have the effect of causing dissolution of any Council which is functioning immediately before such amendment, till the expiration of its duration under the law prevailing before this amendment; (iii) An election to constitute any Council viz., District, Regional, Village and Intermediate Council and Municipality shall be completed a) b) before the expiry of its duration specified in clause (i) above; before the expiry of the period of six months from the date of its dissolution.
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(v)

All Councils, Village, Intermediate, Regional and District, and Municipalities constituted upon the dissolution of a Council before the expiration of its duration shall continue only for the remainder of the period for which the dissolved Council would have continued under clause (i) had it not been dissolved. In paragraph 2 after sub-paragraph (6A), the following shall be inserted:

(d)

6(B) Subject to the provisions of this Schedule, the superintendence, direction and control of the preparation of electoral rolls for the conduct of all elections to all the Councils and Municipalities shall be vested in the State Election Commission of the State constituted as envisaged in Article 243 K of the Constitution. (e) In paragraph 2, point (a) of sub-paragraph (7) shall be deleted and the following subparagraph 7 (A) shall be substituted namely:7A i) Each Village and Intermediate Council and Municipality shall after its first constitution makes rules, with the approval of the District/Regional Council concerned, with regard to the matters relating to its procedure and conduct of business. ii) The said rules shall be submitted to the concerned District/Regional Council by the Village/Intermediate Council or Municipality for approval, which may be accepted or returned by the concerned District / Regional Council with comments, and suggested modifications, if any, within 30 days, subsequent to which the concerned Village/Intermediate Council and Municipality shall reframe its rules and resubmit to the District/Regional Council. In case no comments are made by the District/Regional Council within 30 days, the rules shall be deemed to have been accepted. (f) In paragraph 2 after sub-paragraph (7), the following sub-paragraph shall be inserted:2(8) The criteria for disqualification of a person from being elected to any Council or Municipality shall be the same as those identified for Panchayats in Article 243F and for Municipalities in Article 243V. 3. Paragraph 3 shall be amended as follows: (a). The references in sub-paragraph (1) of Paragraph 3 pertaining to items in the following shall be deleted:
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(i) Village Council in sub-clause (e), (ii) village administration and village police in sub-clause (f), and (iii) The entire sub-clause (g) dealing with succession and appointment of Chiefs and Headmen. (b) Paragraph 3A shall be amended as follows: The clause the Chakma District Autonomous Council, the Mara District Autonomous Council and the Lai District Autonomous Council shall be added after the clause the North Kachar Hills Autonomous Council and the Karbi Anglong Autonomous Council in Paragraph 3A of the Sixth Schedule wherever the later Clause appears in the said Paragraph. (c) Two new paragraphs 3C and 3D shall be added as follows: 3C. District Council to function as District Planning Committee: The District Council or a committee constituted by the District Council shall assume the role of District Planning Committee (DPC) with powers and functions as envisaged in Article 243ZD in case the Council covers a whole district. In case a Council covers more than one district, the DPCs of the districts concerned shall function under the guidance of the District Council. In case a Council covers less than one district, representation of the area of that Council shall be ensured in the DPC in consultation with the Council. 3D. Powers of Gram Sabha: The Gram Sabha shall have powers given in Annexure and such other powers as the Governor, in consultation with the District / Regional Council, may deem necessary for effective self- governance at the village level. Provided that the Gram Sabha may delegate such powers as may be deemed necessary to the Village Council and the Council shall be accountable to the Gram Sabha. 4. (a) Paragraph 6 shall be amended as follows: In paragraph 6 after sub-paragraph (2) the following sub-paragraph shall be inserted: (i) Subject to provisions of this Constitution, the Legislature of a State shall, by law, endow the Councils at the appropriate level and Municipalities with such powers and authority, in addition to the powers specified in this Schedule, as may be necessary to enable them to function as institutions of self government in respect of all functions which can be performed at the local level including subjects listed in the Eleventh and Twelfth Schedule.
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5. Paragraph 7 shall be amended as follows: (a) After paragraph 7, the following paragraph 7A shall be inserted:All Councils and Municipalities shall prepare their own budgets following the principles of financial prudence. The Governor shall have the power to approve the budget of Autonomous Councils and the budgets of Village and Intermediate Councils and Municipalities shall be approved by the District / Regional Councils. (b) In paragraph 7 after sub-paragraph (2) following sub-paragraph shall be inserted:2(A) State Government shall release plan and non-plan funds by evolving criteria on the basis of population, area and socio economic indicators for developmental activities and to run the administration. (c) In paragraph 7, after (4), the following sub-paragraph 4(A) shall be added namely: 4(A) Village and Intermediate Councils and Municipalities shall follow the guidelines of the Comptroller and Auditor General of India with respect to accounts. The auditing of the accounts of these Councils shall be as per guidelines issued by the C&AG. 6. After paragraph 8, the following paragraph 8(A) shall be inserted: 8A the Governor of a State shall, as soon as may be, in any case within one year from the commencement of the Sixth Schedule to the Constitution (Amendment) Act, 2009 and thereafter at the expiration of every fifth year, constitute a State Finance Commission as envisaged in of Article 243H and 243I. Provided that if the State Government has already constituted a State Finance Commission for the State, the same State Finance Commission may look after the work of the Sixth Schedule areas. 7. A new Para 12Z be added as in the following:

12Z. Administration of urban areas: (1) The Autonomous District/Regional Council shall have an Urban Affairs Committee to oversee the process of urbanisation and ensure equitable development in the District/Region.
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(2) There shall be a Standing Committee for Tribal Affairs in each Municipality for ensuring that due care is taken of tribal interests in the master plan and regulations and laws about the same. (3) The District/Regional Council, shall periodically identify -(i)Special Growth Centers (SGC) marking the beginning of urbanization, and (ii) Zone of Urban Influence (ZUI) in the periphery of all urban centers with the objective of ensuring development with equity. 8. A new Paragraph 12A may be added regarding Governors Report to the President about tribal areas as follows: 12A. Report by the Governor to the President regarding the administration of tribal areas.The Governor of each State having tribal areas therein shall annually, or whenever so required by the President, make a report to the President regarding the administration of the tribal area in that State and the executive power of the Union shall extend to the giving of directions to the State as to the administration of the said areas. 9. Paragraph 16 shall be amended as follows: (a) In sub clause (b) of clause (1) of paragraph 16, the word twelve shall be replaced by six in the fifth line. (b) In the third and second lines respectively of first and second provisions to sub clause (b) of clause (1), the word paragraph shall be substituted by sub- paragraph (c) Sub paragraph (2) and (3) of paragraph 16 shall be deleted.

10.

The following shall be added after para 20(C): 20(D) Notwithstanding anything in this Schedule a) The validity of any law/rule relating to the delimitation of the constituencies or the allotment of seats to such constituencies made or purporting to be made under paragraph 2 of this Schedule shall not be called in question in any court. b) No election to any Council or Municipality shall be called in question except by an election petition presented to such authority and in such manner as is provided for by or under any law made by the Legislature of a State. ------------21/107

Annexure in Sixth Schedule / Schedule 13 [Paragraph 3D] [Powers and functions of Gram Sabha] 1. Competence to resolve disputes in respect of all matters that are included in this Schedule and other matters that may be specified under Nyaya Panchayat Act. 2. Competence to safeguard and preserve the community resources including land, water, forest and minerals 3. Ownership over minor forest produce 4. planning and management of minor water bodies. 5. Control over Village Panchayat 6. Developmental Programmes : The powers to (i) control over local plans and resources for such plans; (ii) approve the plans, programmes and projects for social and economic development before such plans, programmes and projects are taken up for implementation by the Village Panchayat; (iii) identify and select persons as beneficiaries under the poverty alleviation and other programmes: (iv) conduct regular social audit at least once in two months to assess the progress of any work or other activities taken up in the village by any agency what so ever, expenditure incurred, quality, quantity and rates of materials purchased, wages disbursed and such like as. (v) certify utilisation of funds by Gram Panchayat on the basis of social audit. 7. Other Matters (i) (ii) (iii) (iv) Regulation or restriction on the sale and consumption of any intoxicant; Managing village markets by whatever name called; Control over money lending; Control over institutions and functionaries in all social sectors;

8 Consultation with Gram Sabha Consultation with Gram Sabhas concerned before-(i) making acquisition of land for development projects and before re-settling or rehabilitating persons affected by such projects; (ii) granting prospecting license or mining lease for minor minerals; (iii) granting concessions for the exploitation of minor minerals by auction. Explanation: The term concerned shall include all Gram Sabhas in the zone of influence of proposed project- industrial, mining, township and such like.
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Constitutional Appendix 2 Amendment in Part IX Article 243A Gram Sabha Add the following provision in Article 243A Provided notwithstanding anything in the Constitution, the Gram Sabhas in NE States shall have all the powers conferred on Gram Sabhas as per Schedule 13. Article 243MPart not to apply to certain areas: . . (4) Notwithstanding anything in this Constitution, .. (b)Parliament may, by law, may extend the provisions in this Part to the Scheduled Areas and the Tribal Areas referred to in clause (1) and hill areas in the State of Manipur referred to in subclause (b) of clause (2) subject to such exceptions and modifications as may be specified is such law, and no such law shall be deemed to be an amendment of this Constitution for the purposes of article 368.

-------------------

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Constitutional Appendix 3 Amendments in Other Constitutional Provisions 1. Article 339 Control of the Union over the administration of Scheduled Areas, Tribal Areas and the welfare of Scheduled Tribes: (1) The President may at any time and shall, at the expiration of ten years from the commencement of this Constitution by order appoint a Commission to report on the administration of the Scheduled Areas, Tribal Areas and the welfare of the Scheduled Tribes in the States. The order may define the composition, powers and procedure of the Commission and may contain such incidental or ancillary provisions as the President may consider necessary or desirable. 2. Article 275(1) Grants from Union to certain States (Second Proviso) 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 and other NE States sums, capital and recurring, equivalent to (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 NE States.

------------------------

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Thematic Appendices

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Thematic Appendix 1A Recommendations of the Administrative Reforms Commission about Capacity Building in Local Governance Institutions in the North East 1. Left Extremism 1e Training and reorientation including sensitising the police and paramilitary personnel to the root causes of the disturbances that they are seeking to curb, are necessary. 1h. For effective implementation of the Scheduled Tribes and other traditional Forest Dwellers (Recognition of Rights) Act, 2006, multidisciplinary Oversight Committees may be constituted to ensure that the implementation of this ameliorative legislation does not adversely affect the local ecosystems. 1i. Special efforts are needed to monitor the implementation of constitutional and statutory safeguards, development schemes and land reforms initiatives for containing discontent among sections vulnerable to the propaganda of violent left extremism. 1k. Performance of the States in amending their Panchayati Raj Acts and other regulations to bring them in line with the provisions of the Panchayats (Extension to the Scheduled Areas) Act, 1996 (PESA) and in implementing these provisions may be monitored and incentivised by the Union Ministry of Panchayati Raj. 5. Issues Related to Scheduled Tribes 5h. There should be convergence of regulatory and development programmes in the tribal areas. For the purpose, a decadal development plan should be prepared and implemented in a mission mode with appropriate mechanism for resolution of conflicts and adjustments. 10 Capacity Building in Administration in the North East 10a. A composite criteria for identifying backward areas (with the Block as a unit) based on indicators of human development including poverty, literacy and infant mortality rates, along with indices of social and economic infrastructure, should be developed by the Planning Commission for the 12th Five Year Plan. 10c. Regional training institutions for various branches of administration, including the technical services may be operated by the North Eastern Council.
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10e. NEC and the Ministry of Home Affairs may, in collaboration with the States, draw up an agenda for administrative reforms for the region with its implementation being monitored systematically. Satisfactory performance in implementation of this charter may qualify the States to additional funding including special economic packages. 12 Sixth Schedule Councils 12a. To avoid complaints of less favourable treatment to Scheduled Areas in certain respects, suitable amendment may be made in the Sixth Schedule of the Constitution to enable the Autonomous Councils to benefit from the recommendations of State Finance Commissions and the State Election Commissions provided respectively under Articles 243I and 243K of the Constitution of India. 12b. The Union Government, Government of Meghalaya and the Autonomous Councils in that State may review the existing pattern of relationship between the Councils and the State Government to evolve a satisfactory mechanism to resolve conflicts between the Councils and the State Government. 12c. Ministry of Home Affairs may, in consultation with the concerned State Governments and the Autonomous Councils, identify powers under the Sixth Schedule that Governors may exercise at their discretion without having to act on the aid and advice of the Council of Ministers as envisaged in Article 163 (1) of the Constitution. 12d. Paragraph 14 of the Sixth Schedule may be suitably amended to enable the Union Government to appoint a common Commission for all autonomous districts for assessing their state of administration and making other recommendations envisaged in that paragraph. A periodicity may also be provided for the Commission. 12e. Government of Assam should review the existing arrangements of determining budgetary allocations and release of funds to the original Autonomous Councils with a view, as far as practicable, to bringing them at par with the arrangements for the Bodoland Territorial Council. 13. Village Level Self-governance in the Tribal North East 13a. Measures should be taken to ensure that all the Autonomous Councils pass suitable legislation for establishing of village level bodies with well defined powers and a transparent system of allocation of resources.
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13b. Stipulation may be made in the rules relating to release of grants to the Autonomous Councils to the effect that passage of appropriate legislation for elected village level bodies and its implementation, will entitle the Councils to additional funding. 13c. To enable the Autonomous Councils to discharge their responsibilities satisfactorily, it is imperative that the requirement of funds by these bodies is worked out normatively with reference to the minimum standards of service to be provided and capacity to raise local resources. Such exercise could be undertaken by the State Finance Commission. 13d. Nagaland has made commendable efforts to usher in a paradigm of decentralised village self-governance, which combines the elective element with traditional power centers. The Ministry of Rural Development should formally recognise this arrangement for implementation of various development and poverty alleviation initiatives. 13e. Government of Meghalaya may take steps for extension of the experiment of elected village committees in the Garo Hills for implementation of the National Employment Guarantee Act throughout the State for implementation of all rural development programmes. 13f. It is imperative that in all States where village bodies administer justice under customary laws by virtue of the Sixth Schedule or other laws, such laws are duly codified. 14. Tribe Specific Councils in Assam and other Issues 14a. Government of Assam may apportion functions between the tribe specific Councils/village Councils and the Panchayati Raj Institutions in a manner that schemes involving individual tribal beneficiaries may be assigned to the Tribe Specific Councils while area development schemes are left to the latter. 14b. State Governments may initiate a system of meeting at least the establishment costs of the Councils from sources outside the tribal sub plan and build in these requirements in their projections to the next Finance Commission. 14c. State Governments may take steps to identify innovative initiatives which could be entrusted to the Tribe Specific Councils without affecting area development concerns. 14d. Suitable guidelines may be prepared for preparation of District and sub-District plans in the relevant areas through joint efforts of the Tribe Specific Councils and the Panchayati Raj Institutions.
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14e. While continuous and vigorous measures are needed to bring about a consensus between various sections of society in Manipur about revival of the Hill Districts Councils, steps may be urgently taken to bring in suitable legislation to introduce elected village level bodies in the hill areas of that State. 15. Capacity Building in Regional Institutions in the North East NEC and DONER 15d. The Planning Commission needs to lay down a framework for preparation of integrated regional plans, with priorities and not as an assortment of schemes by the NEC. The regional plan should focus on areas with a bearing on intra-regional, inter-State priorities which have the potential of avoiding conflicts and promoting regional integration. 15e. Planning Commission should ensure the association of the NEC in the State plan formulation exercise by suitably amending their guidelines. 15h. The Ministry for Development of North Eastern Region (DONER) may be abolished and the responsibility for the development of the region, including the infrastructure sectors, and utilisation of the non-lapsable fund should be restored to the subject matter Ministries, with the MHA acting as the nodal Ministry. 16. Capacity Building in 0ther Regional Institutions in the North-East 16e. NEC and the Ministry of Home Affairs may, in collaboration with the States, draw up an agenda for administrative reforms for the region with its implementation being monitored systematically. Satisfactory performance in implementation of this charter may qualify the States to additional funding including special economic packages. 18. Capacity Building in the North East Miscellaneous Issues 18a. The recommendations of the High Level Commission contained in its Report Transforming the North East - and the report of the Task Force on Development Initiatives prepared by the North Eastern Council should be implemented to fill the gaps in infrastructure in the region. 18g. There is need for setting up of centers of excellence for professional and higher education in the North East. In addition, a large-scale expansion of facilities for technical education, such as ITIs, should be carried out to create a pool of skilled work force and generate entrepreneurial capacity as well as employment.
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18h. There is a need to make an in-depth study of the customary judicial system in order to achieve better understanding and dissemination of the prevailing norms and practices. 21. Civil Society and Conflict Resolution 21a. While social capital formation needs encouragement to improve delivery of services and build community self reliance, it is imperative that such 2initiatives also attempt to involve communities in in-house conflict resolution. 22. Institutional Arrangements for Conflict Management The Inter-State Council 22a. The conflict resolution role envisaged for the Inter-State Council under Article 263 (a) of the Constitution should be effectively utilised to find solutions to disputes among States or between all or some of the States and the Union. 23. Institutional Arrangements for Conflict Management The National Commission for Scheduled Tribes 23a. The National Commissions for Scheduled Castes and Scheduled Tribes have an important mandate to guide review and monitor the implementation of safeguards provided for SC/STs in various fields, including in the2matter of their service conditions. It is imperative that the focus of the two Commissions remains on policy and larger issues of implementation rather than on cases of an individual nature which can be looked into by the administrative Ministries/appropriate forum with the Commissions playing a critical oversight role.

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Thematic Appendix 1B Important State-wise Suggestions by Ramachandran Committee not covered by the points of action by the Union Government 1. Assam 1. Transfer of Subjects to the Councils as provided in the Sixth Schedule to be completed. 2. Representative bodies at the sub-district level: Legislation to be enacted by the Councils. (a) Village Councils Nagaland pattern may be adopted. (b) Intermediate level arrangements Strengthening of Block Level Coordination Committee in Bodoland Territorial Council (BTC) Areas. 3. Fiscal Decentralization: (a) Annual Plan Allocations Present arrangement to continue . (b) The Single Window System adopted for Bodoland Territorial Council (BTC) Areas to extended to other Autonomous Councils. (c) Delegation of Financial Powers to Councils Such as signature of Utilization Certificates (UCs). (d) Central Sector Projects and Schemes relating to devolved activities to be handled by the Councils. 4. Planning and Project Formulation (a) Preparation of Annual and Five Year Plans by Councils. (b) Arrangements at the District Level Committee under Chairperson of District Autonomous Council to prepare and consolidate the district plans. (c) Representatives of the Councils to be included in the State Planning Board (d) Flexibility of fund usage Autonomy in implementation of select schemes. (e) Strengthening project formulation capabilities Hiring of Professionals and Experts. 5. Monitoring and Evaluation Setting up of Directorate of Economics, Statistics and Monitoring and Evaluation in each Council to institutionalize monitoring and evaluation. 6. Employment Opportunities and Capacity Building Funds to be earmarked for skill development. 2. Meghalaya 1. District Councils to undertake reforms Maximise participation of village people, women and the marginalized. Setting up of village employment councils all over Meghalaya as development agencies. The village Dorbar to continue with traditional powers may be given additional regulatory powers. 2. Demarcation of jurisdiction between the State Government and District Council.
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3. Women may be represented in the Hill Councils. 4. Proposed bill for community level planning should be approved by the State Government. 5. Need for an intermediate institution between the village council and the district council. 3. Tripura 1.Village Level Planning already done by Village Councils under the Gramodaya and Nagarodaya initiatives to be continued, 2. As all districts comprise of both TTAADC and Panchayat areas, DPCs can be constituted in all districts with due representation to representatives of TTAADC. District Collector may be the Member-Secretary 3. TTAADC to nominate its members to the DPC. It should also be represented in the State Planning Board and invited to State plan discussions in the Planning Commission. 4. System of sub zones and zones at the intermediate level to be harmonised with blocks, so that there is only one common intermediate level. 4 Manipur 1. Constitution of District Councils- Immediate constitution of elected councils pending decision of inclusion in Sixth Schedule. 2. Devolution of Subjects to the Councils District Councils be transferred departments of health, animal husbandry, agriculture, public works, forests and small town administration. 3. Representative bodies at the sub-district level. Village Councils- Village Development Bodies be constituted -Provisions of Hill Village Authority Act 1956 be operationalized in consultation with the traditional tribal chief or NREGA arrangement be adopted. 4. Harmonization between Traditional Councils and Village Development Bodies 5. Annual Plan Allocations to be communicated to the district and villages. 6. Centrally Sponsored Scheme allocations to districts and village levels be publicized 7. District planning guidelines to be issued immediately on the pattern of Planning Commission guidelines. 8. Strengthening project formulation capabilities- technical advisory committees be constituted by the District Planning Body. 5. Mizoram 1. Operationalising devolution of subjects to the District Councils Activity Mapping of the roles of the State Government, District Council, the Village Council and the District Administration required. 2. Issuing guidelines on decentralized planning patterned on Planning Commission Guideline. 3. Ensuring transparency of Annual Plan allocations- . 4. Release of Annual Plan Allocations regular Fund transfers from State to District Councils- Monthly/ quarterly basis. Transfers in respect of funds for CSS to be monitored
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for one year. In case of delay, direct funding of Councils be considered. Releases to village councils to be communicated to each village council. Data base of bank accounts of village councils to be compiled. 5. Administrative reform of the District Council Administration: The Governor may constitute a group to come out with a blue print for reform. 6. Strengthening project formulation capabilities: Project consultants be hired by the district councils. 7. Coordination and Monitoring Committee be constituted either within the State Planning Board or under the Chief Secretary with the CEMs of all the three Councils and Deputy Commissioners as members, NGOs, associations of women and the youth and selected chairpersons of the village council 6. Nagaland. 1 Village Level Planning-Nagaland has a time tested system of village councils and village development boards. System of assessment of VDBs is under consideration. VDBs could be classified into performing, average and non-performing to work out a basket of incentives. Rural Department officials assist the VDBs in planning. Experts may be empanelled to assist VDBs. 2. Arrangements at the District Level-Guidelines for the District Planning Board be reworked to align the process of planning with the Eleventh Plan and preparation of a consolidated District Plan including the State Sector plans and the VDB plans. ---------------------

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Thematic Appendix 1C Select Recommendations of Mungekar Committee on Standards of Administration and Governance in the Scheduled Areas 3 (ii) (c) Issue of Guidelines about the role, responsibilities and functioning of Gram Sabhs honouring their competence 3(iv) Guidelines for ensuring that the Gram Sabha should become fully functional in the image of village republic within this year6(iii) PR Institutions as decision making bodies, implementation the exclusive domain of administration 7(i) Raising the level of administration as envisaged in Article 275(1). 9(vi) Urban Centers as pulsating centers of holistic development. 12 The issues of implementation of Forest Rights Act. 5.11 (vi) Separate budget head and Demand for TSP. 5.11.2 Principle of supplementation: The principle of supplemental was crucial. The earlier practice of matching grants was discontinued. All partners must contribute to the best of their capacity while the nodal authority was committed to supplement to the desired extent. The supplemental outlay was non-lapsable The spirit of supplementation could not persist for long. Now the State Governments often are not willing to make a claim for central funds on the ground of their own constraints for bringing their own share. -------------

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Thematic Appendix 2 Part 1: Status of North-Eastern States with regard to Self-Governing Institutions under Part IX and Part IXA of the Constitution and Special Constitutional Provisions *The relevant points in these Articles are given in the page that follows.
Areas Covered by Part IX 1. Arunachal Pradesh No ADC 2. Assam Three ADCs Other Areas 3. Manipur (i) Hill areas (ii) Valley 4. Meghalaya Three ADCs (No other areas) 5. Mizoram Three ADCs Other areas 6. Nagaland Nil 371G
(243M(2)(a)

State/Autonomous Councils

Areas Exempted as 6th Schedule Areas Part IX IX A Otherwise

Part IXA

Special Const. Provisions

Nil 371B*

371C
(243M )(2)(b)

(243M)(2)(a)

371A

Tuensang Regional Council under 371A 7. Sikkim No special area 8. Tripura One ADC General areas

371F Nil

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Part 2: Special Constitutional Provisions: Article 371-A: This Article enacted after Naga Hills-Tuensang Area became a separate State has extensive special provisions. In particular it envisages that (i) no Act of the Parliament on subjects specified therein will apply to the State without the approval of State Assembly; (ii) the Governor shall have special responsibility about law and order in the State; and (iii) a Regional Council shall be established for Tuensang with Deputy Commissioner in chair. It functions under guidance of the Governor. No Act of Nagaland Assembly shall apply to Tuensang unless authorised by the Governor, on the recommendations of the Regional Council. Article 371B: The Article envisages establishment of a committee of the Legislative Assembly elected from tribal areas. Article 371C: The hill areas in the state of Manipur largely inhabited by tribal communities are not covered by the 6th Schedule. The special provision envisages constitution of Hill Areas Committee of State legislature. The Governor is mandated to report to the President regarding the administration of hill areas. Article 371F: According to this Article (i) Governor has special responsibility for peace and making, in his discretion, equitable arrangement for ensuring the social and economic advancement for different sections of the population of Sikkim; (ii) President can extend any enactment of any State with such restrictions or modifications to Sikkim as he may deem necessary as also remove other difficulties; and (iii) Parliament may, for the purpose of protecting the rights and interests of the different sections of the population of Sikkim may make provision for the number of seats in the Legislative Assembly of the State of Sikkim, which may be filled by candidates belonging to such sections. Article 371G: The Article envisages that no Act of Parliament with regard to matters specified there in, including customary law and transfer of land, can apply to Mizoram unless the State Legislative Assembly by a resolution so decides.

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Article 371H: The administration of the then North East Frontier Agency, now the State of Arunachal Pradesh, was a special responsibility of the Governor of Assam. The special provision for Arunachal Pradesh in this Article envisages special responsibility of the Governor in respect of law and order. Accordingly, the tribal state of Arunachal Pradesh is doubly ignored. It has no special provision for administration as envisaged for tribal areas in North East under the 6th Schedule or even Schedule Areas in other States. Part 3: The Legal Frame of Self-Governance in NER and its Implications: 3.1 In sum, the States in NER broadly comprise three legal typologies as follows(a) Sixth Schedule Frame: The Council areas, that is, entire Meghalaya, parts of Assam, Mizoram and Tripura are governed by the provisions of Sixth Schedule. Parts IX and IXA of the Constitution have not been extended to these areas so far. (b) State Legislation Frame: Part IX does not cover (i) Nagaland and (ii) non-Council Areas in Mizoram. In their case the State laws continue as they are. (c) National Frame: The national self-governance frame in Part IX (Panchayats) and Part IXA (Municipalities) covers (i) Arunachal Pradesh, (ii) Sikkim, (iii) Manipur excluding hill areas and (iii) non-Council areas in Assam and Tripura. Note: The hill areas of Manipur have been excluded from the purview of Part IX but without any provision for an alternative creating vacuum in the legal frame for this area. 3.2 The States in Frame (a) are dependent on Parliament under Article 243M (4) (b) for extension, if any, of the national Panchayat Raj (PR) frame to the tribal areas. The tribal States in Frame (b) can incorporate, on their own, the provisions of Part IX under Article 243M (4) (a), in their State laws. But these provisions have covered in routine the States in Frame (c) including Arunachal Pradesh, a predominantly tribal State. Consequently the special benefit of PESA for Scheduled Areas is not available to Arunachal Pradesh. 3.3 Part IXA covers entire NER except Council Areas in Frame (a) with no indication about their future. Therefore, the provision about District Planning Committees (DPC), central in decentralized planning, is presently not available to Council Areas in NER and also Scheduled Areas elsewhere.

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Part 4: Comparison of Nagaland Act and PESA

Nagaland Village Council Act 1978

PESA

A. Constitution of VC / VP Village council (VC) chosen as per Village Panchayat (VP) elected as in Part IX customary practice Reservation for STs and women BCs as per State Hereditary chief, Gaonbura and Angs law. members of VC VP Chairperson directly or indirectly elected as VC to choose chairperson per Part IX B. VDB / Gram Sabha Village Development Board (VDB): all Gram Sabha (GS): All persons in village. permanent residents of village. DC / ADC chair person of VDB. Management Committee of VDB chosen by VC. Women members not less than one fourth. Decisions of the Management Committee taken in meetings open to the public. Gram Sabha meetings organized as designated in Disputes of VDB Management Committee State Acts (usually chaired by VP Chairperson) first settled by VC, subsequently DC/ADC/; then State Government. C. Powers of VC / VP VC has powers to Powers devolved to VPs as per State laws. i) formulate development schemes and Following mandatory in PESA areas: assist government in development Gram sabha or panchayats at appropriate level: works (i) Be consulted for land acquisition & RR ii) Borrow money, receive grants and (ii) Recommend grant of prospecting licence, subsidies, lend to villagers mining lease and concession for exploitation iii) Supervise maintenance of public (minor minerals) assets, education and welfare (iii) Prohibit / regulate intoxicants activities (iv) Ownership of minor forest produce iv) Maintenance of law and order (v) Prevent alienation of land v) Consent of VC needed for transfer (vi) Manage village markets of immovable property (vii) Control over money lending Though VC does not have judicial powers (viii) Control over social sector institutions and by law, in actual fact exercises them. functionaries (ix) Control over local plans and resources D. Powers of VDB / GS (i) Subject to directives of Village In addition to above: Council, VDB to exercise financial and (i) GS competent to safeguard and preserve the developmental functions traditions and culture of people, their cultural (ii) Management Committee of VDB identity, community resources and
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entrusted with management and funds customary mode of dispute resolution. of VDB. (ii) GS to approve plans, etc for development. (iii) VDB to place accounts before the (iii) Responsible for selection of beneficiaries. Village Council, Village Council may (iv) VP to obtain certification of utilization of cause VDB accounts to be audited. funds from GS E. Intermediate Institutions Role of S/G No intermediate institutions Intermediate and District Panchayats as State Level Advisory Board headed by prescribed under Part IX. Minister to review functioning of Village State Legislatures to endeavour to follow pattern Councils and advise about allotment of of Sixth Schedule at district level. funds State Legislation to be in consonance with customary law, social and religious practices and traditional management practices of community resources State Panchayat Acts articulate powers of State Governments. F. Parallel Bodies State Government to constitute Panchayats and Gram Sabha are to exercise Boards or Committees or declare control over institutions and functionaries in all any local authorities and social sectors. Delegate powers w.r.t. education, water supply, roads, forests, power sanitation, health and other welfare and development Schemes. Persons authorized by S/G have power to inspect. S/G may declare an authority incompetent Conclusions Nagaland Village Councils lack elements of democracy, while Panchayats in PESA are democratic Community subordinate to VCs in Nagaland while PESA makes Village Panchayat accountable to community State Government enjoys wide powers in Nagaland, in PESA State legislation to be in consonance of practices of community PESA like provisions or PETA to be promoted -----------

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Thematic Appendix 2A The Broader North Eastern Perspective Some important special features of NER are: (i) NER is a sensitive region. There is compelling need to balance security, tribal identity and institutions, economic development and Natural Resource Management. (ii) Various attempts for achieving needed balance became infructuous because of the complex structures, overlapping jurisdictions, ad hoc decisions and non-implementation of agreements even when embodied in the Constitution. (iii) The Constitutional innovation of Councils in NE has become ineffective over time, mainly because of non-resolution of the contradiction between traditional institutions enjoying the strength of custom and usage and formal institutions having legal powers on paper. (iv) The District Councils in most cases have not constituted Village Councils. And where constituted, they have remained ineffective in the face of strong traditional Councils. (v) The establishment of formal courts, as brought out in NEHU study, has made no significant contribution in the administration of justice so far. The dispute resolution in Council areas is largely dealt by the traditional system. (vi) The role of Councils is not appreciated in Meghalaya and Mizoram. There is impasse in Manipur, due to non-recognition of hill areas as tribal area. The formal position of Councils is better in Assam due to its long experience. Five new Councils have been formed under State law and a few more are under consideration. (vii) The establishment of some Councils and even States in NER is rooted in accords between Government and concerned tribes. This has led to variation in Councils powers. For example, Bodo Territorial Council and Karbi Anglong Council in Assam have been given extensive powers that is causing discontentment amongst others especially North Cachar Hills Council. (viii) The District level self-governing institutions in NE are quite varied. There are District Panchayats in Part IX areas and District Councils in tribal areas. Nagaland has no district level body. State deals directly with Village Councils. (ix) Part IXA does not cover Council areas. The urban bodies in Council areas, albeit rare, are functioning under Council laws and regulations enacted under the Sixth Schedule. (x) The States are reluctant to devolve funds to Councils. There is no devolution of funds from National Finance Commission or State Finance Commissions even where they are established. ------------------

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Thematic Appendix 3 Administration of Tribal Areas under the Sixth Schedule Tribal Affairs is not formally included in any of the Lists of the Seventh Schedule. But there are substantial provisions in various Articles in the Constitution. Part X concerns the Scheduled and Tribal Areas. The provisions of the Sixth Schedule apply, under Article 244(2), to the administration of tribal areas in the States of Assam, Meghalaya, Tripura and Mizoram. The provisions of the Fifth Schedule apply, under Article 244(1), apply to the administration and control of the Scheduled Areas and the Scheduled Tribes in any State except the four covered by the Sixth Schedule. Article 339 concerns the Control of the Union over the administration of the Scheduled Areas and the welfare of Scheduled Tribes Clause (1) of this Article concerns the Presidents power to appoint a Commission to report on the administration of the Scheduled Areas and the welfare of the Scheduled Tribes in the State. Clause (2) extends the executive power of the Union to the giving of the directions to a State as to the drawing up and execution of schemes specified in the direction to be essential for the welfare of the Scheduled Tribes in the State. Scheduled Areas and the Union The Fifth Schedule of the Constitution concerns Provisions as to the Administration and Control of the Scheduled Areas and the Scheduled Tribes. Para 2 of the Schedule envisages that the executive power of a State in Scheduled Areas shall be subject to the provisions of the Fifth Schedule. The Governor is mandated to send a Report to the President regarding regarding the administration of the Scheduled areas in that State. Further, the executive power of the Union shall extend to the giving of directions to the States as to the administration of the said areas. The only provision in the Fifth Schedule for States not having Scheduled Areas concerns establishing Tribes Advisory Council under Para 3(1). Tribal Areas, Self-Governance and the Governor The Sixth Schedule [Articles 244(2) and 275(1)] of the Constitution is entitled as Provisions as to the Administration of Tribal Areas in the States of Assam, Meghalaya, Tripura and Mizoram. These provisions are exclusive for the tribal areas specified in Para 20 of the Schedule. The members of the Scheduled Tribes living in other States and even outside the tribal areas in specified States do not have the benefit of exclusive provisions for self governance as envisaged for those living in the tribal areas of the four States of the NER.

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The exclusive provisions in the Sixth Schedule comprise highest form of selfgovernance comprising legislative, judicial and executive powers all rolled in one that has earned this frame the epitaph of State within State. Clause (b) of Second Proviso to Article 275(1) envisages that the cost of such schemes of development as may be undertaken by that State (Assam) 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 area of that State shall be paid out of the Consolidated Fund of India as grants-in-aid The legislative jurisdiction of the District Council is fully protected against any intrusion by State Legislature. Similarly the Regional Council is protected against intrusion by District Council. The Governor has the powers about creation of autonomous districts, giving assent to all Council laws and regulations, conferment of powers for trial of suits and cases, appointment of Commission to inquire into and report on the administration of autonomous districts. The Report, along with the recommendations of the Governor, is laid before the State Legislature by the concerned Minister along with an explanatory memorandum regarding the action proposed to be taken by the State Government. The Vital Difference Thus there is a qualitative difference between the provisions with regard to administration of the Scheduled Areas under the Fifth Schedule and the tribal areas under the Sixth Schedule. In the Scheduled Areas, the Governor is the sole legislature with power to amend the existing laws and framing of regulations subject to the assent by the President. The executive power of the State in the Scheduled Areas is subject to the provisions of the Fifth Schedule, which endows the Union with the power to giving of directions to the States about administration of Scheduled Areas. So far as the tribal areas in four States in NER are concerned, the legislative power under Para 3 of the Sixth Schedule vests with the District Council subject to giving of assent by the Governor. The President and the Union are conspicuous by their absence from the schema of administration in the Sixth Schedule. The Governor is the final arbiter, albeit with a big question mark as to whether he can act in his discretion or has to go by the advice of the Council of Ministers of the State. ----------------

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Thematic Appendix 4 Raising the level of Administration of Scheduled and Tribal Areas Second Proviso to Article 275 (1) under writes revenue deficit in respect of the administration of the tribal areas and also the cost of schemes undertaken by the State with the approval of the Government of India for the purpose of raising the level of administration there of to that of the rest of the State. The First Proviso has similar provision in respect of promoting the welfare of the Scheduled Tribes in the State and for raising the level of administration of the Scheduled Areas to that of the administration of the rest of the areas of the State. The two provisos were kept outside the purview of the Finance Commission on the ground that it is open to the State to sponsor schemes at any time and not necessarily once in five yearssince this is a continuous process, it is but appropriate that these matters are left to be dealt with between the Government of India and the Government of the States without bringing the Finance Commission into the picture (See Enclosures for details). What was supposed to be a continuous process remained unattended simply because no systematic exercise has been done for raising the level of administration in the tribal areas or even the Scheduled Areas. The Ministry of Home Affairs took up this issue with the Seventh Finance Commission. Even though the terms of reference remained unchanged, the Commission made an ad hoc provision for strengthening administration in the Scheduled Areas. The Eighth Commission continued this special dispensation. The Ninth Finance Commission, however, made no special provision simply because the States did not make necessary proposals. In fact, what elements should comprise raising the level of administration remains undefined to this day. This omission in the case of tribal areas in NE has a special dimension. The reference of State for raising the level of administration of the tribal areas in the Second Proviso has been Assam from the very beginning. As some Council areas like those in Meghalaya and Mizoram became full-fledged States, they got formally excluded from this scheme because the reference State in Second Proviso remained Assam. The issue of raising the level of administration in the case of Council Areas in Tripura and Mizoram also remained unattended for the same reasons. The Constitutional mandate to provide financial assistance for raising the level of administration in the tribal areas to that of the rest of Assam has to be appreciated in its spirit rather than in the mechanical frame of the letter of the law. Special care should have been taken about the raising the level of administration of the entire tribal area as identified in the beginning also additional areas that were brought within its frame later. This was not done.
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This lapse should be made good by launching a scheme under the first and the second provisos of Article 275(1) for raising the level of administration of all tribal areas, past and present, in the NE and also the Scheduled Areas in the rest of the Country. A ten year, perspective plan and annual action plan should be prepared for this purpose to accomplish this task in about ten years or so. Further, these should be prepared in consultation with Government of India. Advantage can also be taken for this purpose of other schemes such as Backward Regions Grant Fund. The specific task of raising the level of administration taking the overall frame of entire NER, and not the reorganized Assam, should be taken up in right earnest. Second proviso to Article 275(1) should be amended so as to make all the State in NER eligible for assistance for raising the level of administration to that of the NER as a whole.

---------------

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Thematic Appendix 5 Governance at the Village level - 1 Council areas The community at the village level in tribal areas throughout the country is still managing its affairs in accordance with its customs and tradition. This tradition is much stronger in NER compared with the rest of the country. Para 3 of the 6th Schedule accords central position to Autonomous District /Regional Council. It authorises them to make laws for the establishment of Village Councils and defining their powers. The traditional bodies have not reconciled to this incongruous position in the 6th Schedule even after half a century. This dissonance has led to a state of virtual impasse in most of the Autonomous Districts in NER. The Nagaland Initiative Nagaland realised this incongruity of the traditional versus the formal stance at the community level quite early. It tried a number of alternatives and finally adopted a single tier local body system in 1990. The Nagaland Village Council Act accepts the prime position of traditional Village Councils, unmindful of the name by which they may be known locally. The concerned community constitutes the Village Council according to the prevailing customary practices and usages, albeit with a qualification, viz, the same being approved by the State Government. The traditional village heads and other leaders are ex-officio members of this Council. The Village Council is envisaged as auxiliary to the administrationwith full powers to deal with internal administration of the village including law and order. In particular, no transfer of immovable property can be done without the consent of the Village Council. The Village Council had the power to administer justice in accordance with the customary law and usages as accepted by the canons of justice established in Nagaland. Village Development Board: The Act further empowers the Village Council to establish a Village Development Board. All permanent residents of the village are members of this Board. The Deputy Commissioner of the District is its ex officio Chairman. But the Board operates all programmes with the sanction of Village Council. The VDB exercises all powers subject to the directions of the Village Council. The general body of VDB shall hold at least two meeting in a year. The decisions of VDB shall be authenticated by the chairman of the Village Council. Management Committees of VDB: The Village Council nominates a Management Committee of the VDB with at least 25% reservation for women. At least one meeting of the Management Committee shall be held every month on the fixed date. The Village Council may cause the VDBs accounts to be audited at such times as it may decide. All disputes arising out of VDB Management Committee shall be settled first by the Village Council. In
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case of any dispute about the interpretation of the rules, the Deputy Commissioners decision thereon shall be final subject to the approval of the State Government. Communitisation of Public Institutions and Services: The Nagaland Communitisation of Public Institutions and Services Act, 2002 provides for empowerment and participation of the community in matters connected with the management of local utilities, public services and the activities of the State Government connected with education, water supply, roads, forests, power, sanitation, health and other welfare and development schemes and to provide for promotion of community based schemes incidental thereto. Three village level services (Elementary Education Institutions, Health Sub-Centers and Village Electricity Management) and one at group of village level (Community Health Centers and Primary Health Centers) were brought under its purview in 2002 itself. The composition of Village Committees is given in the rules. It includes the Chairman elected/selected by the Village Council. The District Coordination Committees, which are constituted for every communitised item, are chaired by the Deputy Commissioner. These Committees report to the State Government especially about financial matters. The Government is also responsible for resolving doubts about rules, if any. Some Questions Unanswered: Nagaland has taken extraordinary ingenious measures to bring the self-governing autonomous Village Councils governed by their tradition and customs within the formal frame of modern State. The traditional Village Council is supreme in the familiar and functional setting of its territorial domain, now formally recognized as Village even under the law. All state-sponsored activities have been assigned to a formally constituted new institution, Village Development Board (VDB), with all permanent residents of the village as its members. VDB is Village General Assembly with a difference. A State representative, the Deputy Commissioner, is its ex-officio chairman. But Management Committee of VDB is nominated by and answerable to the Village Council. While the composition of Village Council is mandated by their tradition, VDB and its Management Committee have adopted inclusive democratic formal frame. Similarly communitised public institutions are operated under the guidance of Village Committees but they are subject to State control through District Coordination Committees chaired by the Deputy Commissioner. This institutional frame is especially designed as an effective check against the malefic influence of money power in simple communities. Preparing for Future Contingencies: In the early phase of experimentation of the traditionalformal interface, the writ of the traditional system has prevailed unequivocally. The anomalies like the general body of the village in the form of VDB being answerable to the Village Council, which in reality is its representative body, have not been noted in the glare of statesponsored innovation. The provisions concerning State control over the traditional system like State approval of prevailing customary practices have remained dormant and unknown to the
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people. But this happy phase of accommodating systemic anomalies may not last long in the event of formal assertion by the system under cover of law and weakening of the traditional with spread of new democratic spirit. A stage therefore has reached when the glaring anomalies should be gradually removed and the well-established democratic norms of selfgoverning systems are adopted even in Nagaland. -------------------

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Thematic Appendix 5A Governance at the Village level-- 2 General and Scheduled Areas Panchayats in Directive Principles: Article 40 envisages organisation of village panchayats by the State and endowment of such powers and authority as may be necessary to enable them to function as units of selfgovernment. The term panchayat here has been used in the natural sense as assembly of the people in a village. That it should lead to reestablishment of village republics in the entire country was the fond hope of the Founding Fathers. But that was not to be. The panchayats were established, but they comprised elected representatives of the people in the concerned village. Local Government in Seventh Schedule: 2 Local government that specifically covers village administration is included in List IIState List as Item 5 in the Seventh Schedule. Accordingly while the Union Government can play advisory role or can even take some executive measures in pursuance of the Directive Principle concerning village panchayats in Article 40, the legislative powers in this regard are unequivocally vested in the Legislature and its implementation in the executive of concerned State. Part IX of the Constitution concerning Panchayats 3. The state of local governance in the country in this frame became highly uneven in different states. This situation was reviewed in 1980s. It was decided that a basic frame of local government such as formal structure of local bodies, electoral process, reservation and such like shall not be left to the States and be incorporated in the Constitution itself. Accordingly the Constitution was amended (73rd Amendment) in 1992 and Part IX concerning Panchayats was added there to. (1) Panchayats under Article 243G 4. Part IX provides the basic frame of local government in rural areas beginning with the village assembly up to the district panchayat. The powers, authority and responsibilities of Panchayats have been laid down in Article 243G. This Article envisages that the Legislature of a State may, by law, endow the Panchayats with such powers and authority as may be necessary to enable them to function as institutions of self-government. The Article also
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specifies certain schemes of economic development and social justice that, inter alia, may be entrusted to the Panchayats at the appropriate level including those given in Schedule 11. 5. The powers etc of Panchayats at appropriate level in Article 243G are subject to the provisions of this Constitution. Thus the Parliament while specifying these powers abided by the schema of legislative domain in Schedule VII, accepted for itself a recommendatory role leaving it the discretion of the State Legislature that may enact a suitable law in that regard with no obligation to accept the propositions in this Article including those in the 11th Schedule. (2) Gram Sabha under Article 243A 6. The provision about powers and functions of Gram Sabha in Article 243A is general with no content whatsoever therein. It does not contain even a suggested frame like that for panchayats in 243G. Moreover, even the policy prescription, viz, to enable them to function as institutions of self-government, that appears in all dispensations about Panchayats is missing here. This Article, therefore, does not add any thing whatsoever to the bare fact that Gram Sabha that is an integral part of village administration , may exercise such powers and perform such functions as the legislature of a State may, by law, provide. (3) Panchayats in State Laws 7. The Panchayat Raj laws enacted by the States after the 73rd amendment did make provisions about Gram Sabha therein. But not all Acts articulate the role of Gram Sabha clearly. (4) Part IX not to apply to certain areas and its extension thereto: (i) Exclusion: 8. Part IX concerning Panchayats does not extend to a number of areas included in Clauses (1) and (2) of Article 243M, that is, (1) the Scheduled Areas and Tribal Areas mentioned in Clause (1), and (2) (i) States of Nagaland, Meghalaya and Mizoram mentioned in Clause (2) (a) and (ii) the hill areas in the State of Manipur for which District Councils exist under any law for the time being in force mentioned in Clause (2) (b).
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(ii) Extension of Part IX: 9. This Part can be extended under Clause (4) of the same Article to the above mentioned areas by (a) the Legislatures of concerned States, that is, Nagaland, Mizoram and Meghalaya (b) the Parliament by law in the case of Scheduled and tribal areas subject to such exceptions and modifications as may be specified in such a law. Note: There is no provision for extension of this Part to the Hill Areas of Manipur. (iii) Scope of Parliamentary Law about Extending Part IX subject to Exceptions and Modifications: 10. The sub-clause (4) of Article 243M concerning extension of the provisions of Part IX begins with the non-obstinate clause Notwithstanding any thing in this Constitution. Accordingly, while extending the provisions of Part IX to the excluded areas, the Parliament is not constrained by any provision of the Constitution including the schema of Seventh Schedule about division of legislative powers between the Center and the State. But the formulations for extending these provisions to the States of Nagaland, Mizoram and Meghalaya and to the Scheduled/Tribal Areas are quite different, that is, (i) In the case of three States of Nagaland, Mizoram and Meghalaya, the concerned State legislature can resolve to adopt Part IX as it is. The law passed by the Parliament for extending the provisions of Part IX to the Scheduled Areas and tribal areas can provide for such exceptions and modification as may be deemed necessary unmindful of the division of legislative jurisdiction in the Seventh Schedule. Moreover, Scheduled Tribes, Scheduled Areas and Tribal Areas are not specifically mentioned in any of the three lists of this Schedule. Therefore, the legislative power to make any law exclusively for tribal affairs, Scheduled Areas and Tribal Areas vests in the Parliament under residual entry 97, namely, any other matter not enumerated in List I or List II

(ii)

Critical Resume of the Constitutional Scheme 11. The position concerning powers, authority and responsibilities of Gram Sabha and Panchayats in the Constitution can be summarized as in the following:
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(1) The State legislature has the exclusive jurisdiction about enacting laws concerning local government including village administration. Accordingly the State laws are expected to be comprehensive covering all aspects of local administration including the powers, authority and responsibilities of Gram Sabha and Panchayats. (2) Certain features of local administration including the tenure of panchayats, elections, and reservations, however, have been firmed up at the national level and added in the Constitution as Part IX. (3) Part IX of the Constitution does not transgress the legislative domain of the States in respect of the powers, authority and responsibilities of Gram Sabha and Panchayats at different levels. But there is significant difference between the provisions of Gram Sabha in Article 243A and Panchayats in Article 243G. While Article 243A concerning Gram Sabha is devoid of any content, Article 243G presents a suggestive frame for powers etc of Panchayats that the State Legislatures may adopt in their discretion. (4) The special situation in tribal territories with regard to self-governance has been recognised in Article 243M. There are four sets of formulations in this regard, viz., (i) In the case of tribal states of Nagaland, Mizoram and Meghalaya, the discretion to adopt the provisions of Part IX has been left to the concerned State assemblies. In the case of Scheduled Areas and tribal areas, the responsibility to extend the provisions of Part IX has been assigned unequivocally to the Parliament notwithstanding any thing in the Constitution. While hill districts in Manipur are excluded from the purview of Part IX, there is no provision about its extension with suitable modifications to these areas. In the case of Arunachal Pradesh, a tribal territory with unique features, there is no special dispensation about self-governance in Part IX. Accordingly the provisions of Part IX became applicable to Arunachal Pradesh as in the general areas in the country without even an indication about its special situation.

(ii)

(iii)

(iv)

Follow up Action about Exempted Areas under Article 243M

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12. The status of follow up action in respect of exempted areas is as in the following: (1) No action has been taken by the legislatures of Nagaland and Mizoram to extend and adopt Part IX to their respective States. (2) So far as Meghalaya is concerned, this provision is inoperative since the entire Meghalaya comprises tribal areas under the Sixth Schedule in whose case, action in this regard, if any, has to be taken by the Parliament. (3) No follow up action is indicated in Article 243M itself in respect of the hill areas of Manipur. (4) The provisions of Part IX have been extended by the Parliament to the Scheduled Areas with necessary exceptions and modification under The Provisions of Panchayats (Extension to the Scheduled Areas) Act, 1996.(PESA) The law came into effect on 24 th December, 1996. Approach adopted by the Parliament in PESA 13 As stated earlier in Para 10 above the power of the Parliament about extending Part IX to the Scheduled Areas with exceptions and modifications under Clause (4) of Article 243M is absolute notwithstanding anything in the Constitution. It overrides the schema of the Seventh Schedule about the jurisdiction of State Legislatures about local government including village administration. The Parliament, however, did not invoke this power while enacting PESA. It took the alternative course of constraining the Legislatures of concerned States from making any law which is inconsistent with what have been termed as certain features specified in PESA. Thus, Section 4 of PESA begins with a clause as follows: Notwithstanding anything contained under Part IX of the Constitution, the Legislature of a State shall not make any law under this Part which is inconsistent with any of the following features, namely 14. Thus, the Parliament preferred not to specify in PESA the rights, duties and powers of Panchayats and Gram Sabhas in the Scheduled Areas. It preferred to enumerate them under the term features of self governance and directed that the Legislature of the concerned State shall not make any law that is inconsistent therewith. In this approach while the kernel of selfgovernance is defined in the features specified in Section 4, the onus of enacting the law is with the State Legislature. The intention was perhaps to ensure that the vast diversity in the
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socio-economic situation in Scheduled Areas will be taken care of while enacting Panchayat laws. Special Features of Self-Governance in PESA 15. The most notable feature amongst the tribal people is the strong tradition of self governance especially at the village level. The anomalies in the traditional-formal interface have been suitably blended in PESA as in the following: (i) Village as a Natural formation 16. While Village in Part IX is purely a legal construct, PESA defines village as a natural and social formation. (ii) Powers of Gram Sabha, Not endowed but Natural 17. PESA makes a departure from the Constitutional provisions in Articles 40 and 243A that envisage endowing of powers as may be considered necessary to enable them to function as units of self-government. Section 4(d) of PESA envisages that Every Gram Sabha shall be competent to safeguard and preserve the traditions and customs of the people, their cultural identity, community resources and the customary mode of dispute resolution. (iii) Village Panchayat as the Executive Body of Gram Sabha 18. The State Panchayat laws regard Gram Sabha as a deliberative body whose recommendations are considered by the Village Panchayat. But the features outlined in PESA envisage Gram Panchayat as the executive body of Gram Sabha. It is unequivocally answerable to the same. This frame of self-governance has made drastic visible change in the tradition bound tribal communities in the Scheduled Areas. For example, women, according to the tradition in most of the tribal societies, have no place in the village assemblies. Now they are not only participating in them but, in some cases, are effectively using the special prerogative about at least one-third women being present in the village assembly to complete the quorum. The reservation in the positions of Sarpanch in Panchayats has added to their confidence. The anomaly in Gram Sabha-Gram Panchayat relationship has been removed in MP Panchayat Act following PESA position making Village Panchayat as the executive body that implements the decisions of the Gram Saba. The MP Act has been renamed as MP Gram Swaraj and Panchayat Raj Act.
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(iv) Other features of village governance in PESA 19. The features of self-governance in PESA cover virtually all aspects of administration at the village level besides special provisions about reservation and also the role of Panchayats in some spheres in association with or without Gram Sabha. Consultation with Gram Sabha or Panchayat at appropriate level in case of acquisition of land and grant of leases of minor minerals are crucial. Other aspects include resolution of disputes, control over money lending, use etc of intoxicants, management of community resources including water bodies, restoration of illegally alienated land, ownership of minor forest produce, management of village markets, supervision of social services, approval of development programmes, certification of expenditure. (v) Total transformation of Paradigm of Village Administration 20A .Thus the features specified in Section 4 of PESA are unique in many ways: 1. There is basic departure from formally defined village (Art 243 g) to self-evolved natural entity with. a hamlet or group of hamlets as the basic building block. 2. PESA, instead of endowing powers on Gram Sabha (Article 243A), records its competence to manage all its affairs in accordance with traditions and customs. 3. The powers are comprehensive that include, inter alia, approval before taking up any programme, certification of utilisation of funds, consultation before acquisition of land, managing all matters concerning intoxicants, alienation of land, use of water resources, mining leases, forest rights, money lending, local market, social service institutions and their functionaries. 4. The elected Panchayat is the executive of Gram Sabha and answerable to it. 5. PESA envisages State Legislatures to follow Council pattern of the Sixth Schedule for District Panchayats in Scheduled Areas. 20. In brief, notwithstanding the adoption of democratic polity, members of village community, hitherto, had to look beyond to some exotic authority or other for any problem they faced in their day-to-day life. With the enactment of PESA, the perspective has been totally transformed. The sole reference point for any issue what so ever faced by the people is the Gram Sabha which is competent to manage all their affairs according to its own customs and tradition that every member of the community is fully familiar with, and not according to some exotic law that people are not even aware about and experts in the field may find it difficult to unravel. PESA has been rightly hailed as landmark legislation.
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Universalisation of PESA Frame: (i) Panchayats 21. The big anomaly in the position of Gram Sabha vis--vis Gram Panchayat in the Panchayat Raj laws noted in Para 6-7 above must be removed. The Gram Panchayat, the elected executive of the concerned Gram Sabha should be unequivocally answerable to Gram Sabha as is the case in PESA. Moreover, as noted in Para 4-5 above, Article 243G does provide a frame for empowerment of Panchayats. But it leaves the discretion with the State Legislature to adopt the same. This Article should be suitably amended to the effect that the provisions therein shall be incorporated and in the case of non-action by the State, shall be deemed to have been incorporated in the concerned Panchayat Raj Acts. (ii) Gram Sabhas 22. Article 243A concerning Gram Sabha, as noted in Para 6 above, does not even mention the nature of its powers and leaves the field free for the State Legislature. In fact, Article 243A in the present form serves no purpose and is tautological. With the emerging consensus about the effective role that the open village assembly in the form of Gram Sabha should play, Article 243A should be amended. A clear charter of rights, duties and powers entrusted to the village assembly with necessary details should be incorporate in a new Schedule 13 in the Constitution. 23. The Gram Sabha, or village assembly by whatever name called in an area, is central in any system of self-governance. Therefore, the rights, duties and powers in Article 243A have to be accepted as the common kernel of self-governance at the grass roots throughout the country without any exception. The legislature of the concerned State and the Parliament in special cases may enrich this kernel in deference to the political, social and economic situation of concerned area. Three Tiers in Self-Governance in the Country: 24. In conclusion, we arrive at a three tier frame of self-governance as in the following: Firstly: The Sixth Schedule presents the highest form of self governance with virtual State within State legal frame. Necessary amends will have to be made in the role of village assembly defusing the formal-traditional dichotomy.

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Secondly: The self-governing frame in PESA envisages village assembly or Gram Sabha at the center of the Stage. Gram Sabhas in the NE region should be empowered along the lines of PESA. Frame for the North-Eastern Region: 25. The proposed amendments in the Sixth Schedule, PESA and relevant Articles in Part IX of the Constitution should cover all aspects of local self government in NER. However, the complexity of NER situation with significant local variation will not be fully covered by the above mentioned general formulations. The overall situation and some special measures that will still be necessary can be summarized as in the following. (i) Council Areas in General: The tribal areas as mentioned in Para 20 of the Sixth Schedule will be governed by the amended Sixth Schedule. Nagaland: Nagaland with its commendable experiment with village self governance should also remove the anomalies of village governance and emulate elements of Sixth Schedule and PESA suitably. Meghalaya: Meghalaya, except the municipal area of Shillong, is fully covered Council administration. The resultant contradiction in the perception of State leadership and Council leadership will have to be resolved through informed political dialogue. The consensual frame may require some modifications in relevant laws. Mizoram: The revised Council frame will improve the situation in Council area but political dialogue as in Meghalaya about the difference in the perception of State and Council leadership will be necessary. So far as non-Council areas are concerned the initiative about structural change in the system of self governance rests with the State legislature. The Union Government may suitably advise the State as is being proposed for Nagaland. Tripura: The revised frame for the Council areas and the general areas as proposed in general should satisfy all elements in Tripura. Manipur: As hill areas of Manipur have been excluded from the purview of Part IX of the Constitution, the general Panchayat law of the State with special provisions, if any, for the hill areas are deemed to be in vogue. The impasse about the status of the hill areas will have to be resolved at the political level. Besides
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(ii)

(iii)

(iv)

(v)

(vi)

initiating this dialogue, sub-clause (b) of Clause 4 of Article 243M should be amended to bring hill areas under its purview that will authorise Parliament to extend provisions of Part IX to the hill areas of Manipur. (vii) Arunachal Pradesh: Arunachal Pradesh has been covered Part IX in routine as no special dispensation has been made for it therein.

(viii) Sikkim: No case of special dispensation has been made so far. (ix) Assam other than Council Areas: The revised frame for the Council areas and the general areas, as proposed, should in general cover adequately all aspects of selfgovernance. The identity based assertions for establishment of independent councils in tribal areas must be perceived with empathy in the historical setting. The new frame of self-governance is flexible enough to accommodate diverse socio-political sentiments of the people. --------------------

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Thematic Appendix 6 Tribe specific Councils in Assam and new Councils in Arunachal The self-governance model of the Sixth Schedule envisages One Tribe One Council, albeit District or Regional, as the case may be. The early identification of tribal areas for inclusions in the Sixth Schedule covered compact areas some of which rose from the status of Autonomous District Councils to that of Union Territory and the State. In the mean time the opening up of many areas in NE led to intermixing of population transforming some of the compact tribal areas into mixed population areas. The most notable case is that of Tripura and Bodo territory. The Council frame of the Sixth Schedule with virtual State within State status became a symbol of identity for many a tribal community, big and small. This claim of the people was first conceded in Tripura. The dispersed tribal majority areas there were brought under a Council but without the Sixth Schedule status. The demand of Sixth Schedule was conceded in 1984. Many a tribal community in Assam with extensive area of mixed population has been struggling for Sixth Schedule Status on similar grounds. Their demand for Sixth Schedule status have not been conceded. But six tribe specific Councils have been established under State laws in terms of accords entered between the government and the tribes concerned in the 1990s. A major struggle of Bodo people, however, has culminated in establishment of Bodoland Territorial Areas District under the Sixth Schedule in 2003. PR institutions with village, intermediate and District Panchayats cover the area in which six tribe specific councils have been established. There is obvious overlap. Since these institutions have been established in terms of formal accords they cannot be wished away. According to the Commission, even if the tribe specific arrangements and the Panchayati Raj structures are not mutually antagonistic, they certainly lack complementarities. The Commission has also quoted with appreciation the views of One Member Committee on Tribal Affairs in Assam that bringing these Councils under the Fifth Schedule would resolve this duality. However, the Commission preferred not to follow up that suggestion. It has made a series of recommendations about division of responsibilities between PR institutions and Tribe specific Councils.( 14 a to d) The biggest weakness of the Sixth Schedule model is total centralisation of authoritylegislative, judicial and executive- with the Council. This centralised frame became dysfunctional in the face of powerful traditional Village Councils. In the mean time, in the case of Scheduled Areas PESA frame has resolved the riddle of traditional versus formal. The present impasse in the governance at the village level in the Council areas, therefore, is proposed to be resolved by a mix of PESA and Nagaland provisions. (For details see Appendix 3 Governance at the Village Level in Council areas.)
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This contradiction between the formal and the traditional is prevalent even in other parts of NE, which include the tribe specific Council areas. PESA presents a paradigm shift from centralised power with the Council to all powers about governance at the village level to the Village Council. The Area Council with power to resolve inter-village issues in a group of Villages will be a prestigious institution. With such de-centralised institutional frame, even the District Councils will lose much of their aura. In this context the District Councils will have little to share with the tribe specific Councils. The tribe specific Councils have been established basically in assertion of their respective identity as a tribe. These Councils, therefore, can be persuaded to concentrate on enrichment of cultural life and identity through a series of cultural and literary activities drawing upon the rich tradition of NE in this regard rather than seeking a share in routine economic programmes. They should also take up sensitive humane activities that the formal system is incapable of handling such as care of destitute and the aged. The State may give liberal assistance to these Councils in these spheres which in absolute terms may not be large but its contribution may be incommensurable in human terms. It will be premature at this stage to have a dialogue with these Councils or dwell on the recommendations of the Commission. Let this question be discussed along with other suggestions of the Commission about the position of Councils in Meghalaya (12 b) and role of Governor in Council affairs (12 c). Ministry of Panchayati Raj has not approved of creating District Councils in Arunachal giving good reasons. -----------------

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Thematic Appendix 7 Urban Bodies in Tribal Areas 1. General Background

Local government covering both urban and village administration is in the State List in the Seventh Schedule. But the legislative jurisdiction of autonomous Council in Para 3 of the Sixth Schedule covers (e) the establishment of town committees or councils and their powers; (f) any other matter relating to town administration, including town police Since the term town has not been defined, the legislative jurisdiction of the District Council covers all types of urban bodies mentioned in Part IXA. Since Part IXA has not been extended to the tribal areas not only the laws enacted by the Councils remain unaffected, the legislative domain of District Councils is not circumscribed by any of its provisions. Part IXA of the Constitution deals with all urban institutions of self-government under the common name of municipality. This Part covers all States in NE except tribal area under the Sixth Schedule. The Parliament can, however, extend it to these areas with exceptions and modifications, if any. 2. Some Anomalies As Part IXA already covers all NE States including tribal States it would seem to be in order if it is extended to tribal areas as well. But, the situation is quite variable as amongst different States. In Assam, the Council laws prevail over State laws under Para 12 of the Sixth Schedule. Similar situation prevails in Tripura and Mizoram where the writ of Councils prevails under provisions of Paras 12AA and 12B respectively. As noted by Ramachandran Committee, there is dichotomy between the local body system and municipalities in Meghalaya. Three Councils cover entire Meghalaya. Therefore, according to Para 12A of the Sixth Schedule, in Meghalaya State laws prevail over Council laws. Nagaland has no Councils. The urban bodies can function in accordance with State law read with provisions of Part IXA. In Manipur, however, the hill areas with predominant tribal population do not enjoy special status as in Council Areas. Therefore with the opening up of this area the State legislature may not keep up with the sensitivity and aspirations of tribal people. Similar may be the position of Arunachal Pradesh. Notwithstanding above anomalies, the Council frame of self-governance is superior to District Panchayats having no role in urban affairs. The Councils are in commanding position in their respective areas. Moreover, the inherent contradiction between traditional and formal is absent in urban bodies. These bodies are established by law with no roots in tradition. Nevertheless, experience of urbanisation has not been happy. As observed by Bhuria
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Committee, which had amongst others 8 MPs from NE, many urban centers have emerged as centers of expropriation unmindful of peoples interests. Moreover, even formal State institutions, which should protect peoples interest, tend to stand by exotic forces that are adept at using the legal system. The simple people are at a loss even to understand the nature of exotic processes. They are rendered totally defenseless in their own land. A duly empowered body nearer the people has a better chance of engendering confidence and protecting their interests 3. Provisions of Part IXA A distinctive feature of Part IXA is that it envisages a holistic frame for urbanisation. There are a series of institutions in clause (1) of Article 243Q from Nagar Panchayat to Municipal Council for smaller area to Corporation for larger area and Industrial Township. The Governor under Clause (2) has the power to specify the category on the basis of specified criteria. There is special mention of transitional areas, in the process of transformation from rural to urban. But there is no indication even in the 12th Schedule about special administrative back up for meeting special problems of urbanisation. A clear vision about transitional areas is crucial especially for tribal areas because the central issue in urbanisation is the influx of exotic forces in these areas inhabited by simple people but endowed with fabulous resources. PESA has no doubt strengthened the communitys position in Scheduled Areas especially with the provision of statutory consultation with Gram Sabha before acquisition of land. But the potential of this statutory obligation remains to be even partially realised because of prevailing systemic indifference if not antipathy. The traditional Village Councils in NE, however, have been quite effective in meeting exotic challenges with their intrinsic strength without any legal sanction in their favour. They will become much more effective if clothed with legal authority with a clear objective to ensure that urban centers function as growth centers and promote the interests and welfare of the tribal people in the hinterland and areas of their respective influence. In sum it is crucial that the Autonomous District Councils remain in command of urban bodies especially in the transitional phase in terms of the provisions of the 6th Schedule. Nevertheless note has to be taken of the fact that even strong Councils may be no match to power structure of larger urban centers, industrial towns and such like. These mega centers by their very nature, therefore, can be reined only by the State through its instrumentalities. 4. A Middle Path There are two facets of urbanisation- the early formative phase and the fall out phase. The State cannot attend to innocuous processes of formative phase. On the other hand,
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big urban centers are unconcerned about the fall out in their periphery. Both these situations are transitional but qualitatively different. While in the formative phase, new exotic or even indigenous forces innocuously enter the area and gradually tighten their grip. In the case of big urban centers, they operate from position of power. 5. The Sixth Schedule shall be amended to provide for establishment of SACs and SZIs and empowering them to ensure that urban centers function as growth centers and tribal people become partners in development. ( See Constitutional Appendix1)

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Thematic Appendix 8 District Council, State Government and the Governor The Sixth Schedule under Para 1(2) envisages a self-governing Autonomous Distinct or Regional Council for every Scheduled Tribe in areas that are designated as tribal area. The administrative character of these areas has changed ubiquitously in response to the political aspirations of concerned communities. The Council model endowed with legislative, judicial and executive powers virtually simulates a state within state ideal. This domain is jealously guarded with President and Governor expected to function as guardian with clear Constitutional responsibility to amend the relevant laws that transgress the dividing line. The Governor in particular has special responsibility in general for all Councils and also special for some. He may place one of the Ministers in the concerned State especially in charge of welfare of autonomous districts/regions. Nevertheless there is no provision for regular review or report at any level. The Governor, however, can appoint a Commission under Para 14 to enquire into and report on the administration of autonomous districts/regions. The report of the Commission with recommendation of the Governor is placed before the Legislature of the State by the Minister concerned along with an explanatory memorandum regarding proposed action. The Governor under Para 16 has the power to dissolve District/Regional Council on the recommendation of such a Commission. These provisions are purely ad hoc. There is no system of regular review. There is no mechanism for sorting out difference between the autonomous Council and the State except the goodwill of the Minister in charge. The result, as pointed out by Ramachanadran Committee, is that unresolved issues of administration pile up. Even laws passed by Autonomous Councils may remain pending for years without even any communication from Governor about its position. The strengthening of the self-governing system envisaged in (i) to (vii) above will remain incomplete without a system of regular review of the state of administration in the tribal areas. Governor is the last reference point in all matters concerning administration as envisaged in the Sixth Schedule. The system was expected to function smoothly in the simple setting of the early days. With Governor answerable to the President, personally in command of all affairs in the tribal areas, a formal communication to the President by way of a Report, as envisaged in Para 3 of the Fifth Schedule about administration of the Scheduled Areas, would have been incongruous. Accordingly it has been left to the discretion of the Governor to appoint a Commission to report on any specific issues or about the administration of the tribal areas.
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ARC Report shows that the early ideal setting in which the parameters of the Sixth Schedule were determined has changed significantly. There is confusion on many a point. Many issues have been identified for urgent corrective measures through amendments in the Sixth Schedule outlined above in various sections of this Part. This is not going to be end of journey. As the pace of development quickens the tribal areas will face countless challenges from unexpected quarters. The Governors will no doubt have to play a crucial role in this transformation. But the isolationist frame pursued so far may prove to be dysfunctional. Accordingly the Union must remain well informed about the state of administration in the tribal areas so that correctives can be applied in time. The NER in its turn should be able to draw upon the experience in rest of the country especially the Scheduled Areas. It is in this context that inter-relationship amongst various institutions in NER and at the Union level will need to be clearly defined. (a) Governors Report to the President A new provision in the Sixth Schedule should be made for submission of Governors Report in a new Para 14A entitled Report by the Governor to the President regarding administration of tribal areas with a clear provision for the executive power of the Union extending to the giving of directions to the State as to the administration for the said area on the same lines as in Para 3 of the Fifth Schedule. The Ministry of Tribal Affairs in association with DoNER and MoPR may process this Report and place the same with Action Taken Report before the Parliament. The Governors reports to the President should present a reasonable picture of the situation in the tribal areas. However comprehensive Guidelines for the preparation of Governors annual report, its processing and follow up action should be issued by the Union Government and its strict compliance should be ensured. A draft of the Guidelines is given in Appendix14 .

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(b) National Commission under Article 339: 6.8.5 The President under Clause (1) may appoint at any time a Commission to report on the administration of Scheduled Areas and the welfare of Scheduled Tribes in the States. There is no formal mention in this Article of tribal areas under the Sixth Schedule in certain States of NER. Nevertheless the ambit of the welfare of the Scheduled Tribes in the States is comprehensive and can be deemed to cover the administration of the tribal areas as well. The next Commission when appointed can be asked to cover this aspect specifically. However, it will preferable to amend Article 339(1) and add the clause tribal areas there in. 6.8.6 In the context of the above provisions it is not necessary to amend Paragraph 14 of the Sixth Schedule as recommended by ARC (Appendix 1 Item 12d) to enable the Union Government to appoint a common Commission for all autonomous districts for assessing their state of administration -------------------------

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Thematic Appendix 9 Forest Rights Act (Item 1 h) The Scheduled Tribes and other Traditional Forest Dwellers (Recognition of Rights) Act, 2006 (FRA) is a landmark law that recognizes tribal rights in forests. But so far tribal areas in NE are concerned it ignores the fact that (i) management of areas other than reserved forests, (ii) allotment of land etc therein and (iii) regulation of jhoom in the tribal areas are in the exclusive legislative domain of the concerned Councils. Accordingly the provisions of FRA do not extend to the tribal areas. FRA has special significance even for Non-Council Areas in the NER, which are similarly placed as tribal areas so far as forests are concerned. It is especially so in three matters, namely, (i) implications for 'shifting cultivation', (ii) ownership over Minor Forest Produce (MFP) that includes bamboo, and (iii) formal recognition of the duty as well as power of the Gram Sabha to protect the forest. The far-reaching implications of these three provisions have not been appreciated so far at any level. For example, there is no policy frame even in the law and also the rules made there under for dealing with shifting cultivation that is primary source of livelihood for hill areas in NE. The attempt to treat the issue of shifting cultivation at par with recognition of occupation of agricultural land under FRA, is bound to lead to serious confrontation in NE. In many tribal areas bamboo is the mainstay of tribal economy next only to food. Once ownership of the community over MFP including bamboo has been accepted in law, all present practices of use of MFP founded on State ownership premise are rendered illegal. The State's authority especially on bamboo in many parts of NE has been ubiquitously challenged. A paper mill in Nagaland remained non-operational for years because concerned Village Councils did not allow the mill access to bamboo. In this situation all State leases about MFP especially bamboo must be reviewed. The powers of Gram Sabha in protection of forests remain to be defined under the rules to date. An inter-ministerial Committee led by MoTA comprising representatives of DoNER, MoEF, MoPR and noted experts should be set up forth with to study the field situation, consider especially the above mentioned four crucial issues for the NE and report within 3 months.

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Thematic Appendix 10 Reduced hierarchy & simpler system Capacity Building in Administration: Training Institutions (Items 10c) and administrative reforms (Item 10 e) As recommended by ARC, capacity building in administration, especially in the rapidly changing socio-economic situation and ambivalence is self-governing systems, is crucial for NER, but with a difference. The institutional design in NER is generally guided by national norms. It leads to mismatch between the expectation from high profile institutions and the goal in the form of actual service they render to the people. It is noteworthy that the span of hierarchy in administration between its top echelons including the political executive and the common man, in terms of layers of all descriptions in the secretariat and in field organisations, even in smaller States in NER is the same as in the largest States in the country. Therefore the great potential of small-sized States in terms of simpler system with drastically reduced hierarchy is not realised. Moreover, the great opportunity of direct interface between the people and the administration is also lost. A new opportunity for making amends in this mismatch will arise with the strengthening of self-governing institutions in all NE States. It should, therefore, be used for reviewing the basic structure of administration especially in smaller States with the objective of reducing hierarchies and creating opportunities for face-to-face interaction between people and administration. The next phase of development should become a joint venture of formal administration and self-governing institutions with the common goal of development with dignity and equity. --------------------

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Thematic Appendix 11 Inter-relationship amongst National and Regional bodies in NER 1. General NER has the privilege of high profile administration for States with smaller territories and limited population. The Governor in many cases has special Constitutional responsibility to oversee administration especially in the tribal areas under the Sixth Schedule. (Annexure 6) ARC recommendations naturally dwell on the role of the Governor, concerned ministries and other institutions like NEC, ISC and NCST including abolition of DoNER. A clear vision about the role of every organization/institution is basic for effective administration. But the perception about the role of other institutions and their mutual relationship in the special setting of NER is crucial for achieving the shared objectives. Besides individual issues, the role of every institution and their interrelationships will have to be perceived in the broader socio-economic situation of NER. There is a sharp difference between the frame of administration of the Scheduled Areas under the Fifth Schedule and the tribal areas under the Sixth Schedule. In the Scheduled Areas, the executive power of the State is subject to the provisions of the Fifth Schedule. In the case of tribal areas in Assam, Meghalaya, Mizoram and Tripura the legislative power vests with the Council subject to assent by the Governor. The Governor is the final arbiter in matters concerning tribal areas but with a big question mark. Can the Governor act in his discretion or has he to go by the advice of the Council of Ministers of the State? The President and the Union are conspicuous by their absence from the schema of the Sixth Schedule. The only reference to the President is about his power to direct that a specific Act of Parliament shall not apply to an autonomous district or shall apply with such exceptions and modification as may be specified. (For details refer to Appendix 3 Administration of Tribal Areas under the Sixth Schedule) 2. MoTA The role and responsibility of MoTA in respect of tribal affairs at the national level are envisaged in the Constitution in three distinct situations, namely, (i) Scheduled Tribes in general under Article 339(2) and other Constitutional provisions, (ii) Scheduled Areas under the Fifth Schedule and (iii) Tribal Areas under the Sixth Schedule. The scope for direct involvement of MoTA in general ST programmes in NER is rather limited. Four out of eight States in NER are tribal majority States. Their entire plans are devoted to tribal development.
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Moreover, Union Government has no role in the administration of the tribal areas under the Sixth Schedule. The core Constitutional mandate concerning grant-in-aid by the Union Government from the Consolidated Fund of India for raising the level of administration of tribal areas to that of the rest of the State under Second Proviso to Article 275 (1) of the Constitution has gone by default. (For details see Appendix 4 Raising the level of Administration of Scheduled and Tribal Areas) The issue of tribal autonomy has been at the center of various movements in the NER. Many a community has been opposing even the opening up of the area to preserve their identity. In this situation the core tribal issue in the NE context has been largely perceived as a political issue. This situation, however, is gradually changing now. MoTA in association with DoNER and NEC should play the key role in sharing of experience in the Scheduled Areas and the tribal areas with a harmonious blend of the formal and the traditional drawing upon the rich experience of PESA in Scheduled Areas and the Council experience of the Sixth Schedule with sprinkling of Nagaland and similar other experiences. 3. MoPR All the three reports-- ARC on conflict resolution, Ramachanadran Committee on Planning for the Sixth Schedule Areas and Mungekar Committee on Administration and Governance in Scheduled Areasare unanimous on one point, that is, the key to development with equity and peace and harmony in the volatile situation in NER is with strong institutions of self governance at the village level with all others at higher levels playing a supportive role. They are also unanimous that PESA is a landmark legislation that provides a harmonious frame for interplay of the traditional and the formal. Yet there is virtual confusion with regard to the relationship between the unique and powerful Council frame and the concerned States. PESA remains to be implemented in its true spirit. The key role of MoPR at this turning point in the history of NER has come to be highlighted as a moving force for (i) dissemination of the ideal of Gram Sabha or the traditional Village Councils by what ever name they may be called, as the foundation of Gram Swaraj or village republican frame, (ii) providing institutional support for its operationalisation in its true spirit through presenting model acts and also guidelines, (iii) monitoring the progress with a helping hand to cross the hurdles in local situation and (iv) incentivisation of self-governance at all levels. While MoPR will have direct and continuous liaison with the eight sisters in NER, it will be crucial that the interaction amongst the key six is also intimate and mutually
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supportive. Institutional mechanism for this will be developed in a phased manner as envisaged in the concluding section. 4. DoNER The socio-economic situation of NER is rather complex. It is qualitatively different in many ways from the general situation in the country. The concerned Ministries at the center may make an honest attempt to adapt their policies and programmes to the general situation in the NER in general but even specific situation in each State. Yet the dissonance may persist that may render some exercises even dysfunctional. It is here that DoNER has a crucial role to play. Its continuous contact with Central Ministries on the one hand and intimate understanding of the complex NE scenario on the other should fill this gap and ensure that the dissonance between the national norms and the field reality, if any, is effectively dissolved. ARC while recommending abolition of DONER has gone by its formal charter and also the sentiments expressed during its brief field visits. Nevertheless the fact remains that DoNER has grown beyond its initial charter and has earned fair appreciation as well. A stage has come when DoNER should represent the collectivity of NER in the Capital. It should also have broad spectrum of technical capability for entering in meaningful dialogue with all central establishments on behalf of and in association with every State of the Region. On the other hand, NEC should function as its central reference point in the NER. 5. NEC The great diversity in the socio-economic situation in the NER has significant operational dimensions. The primary task of NEC is to help the States in meaningful peoplecentric planning in the context of (i) their respective human and natural resource endowment, (ii) peoples own perception about development, and (iii) the given financial parameters. With strong self-governing institutions on the ground this task should begin at the village or group of village level. This will ensure that planning does not remain a top-down exercise. Such people centric plans will like a pyramid built on the firm foundation of community decisions, guided though by experts in different fields. DPC under Article 243ZD has the Constitutional mandate to accomplish this historic task. In the tribal areas, the Council itself will assume the role of DPC where it covers a whole district. Alternatively, in cases where a Council covers more than one district, the concerned DPCs will function under Councils directions. NEC should provide over all guidance in this regard. With this rich experience in the field NEC should function as NER Planning Commission in association with and guidance of the national Planning Commission. The
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NEC in this frame will be the Chief Advisor of DoNER and its virtual representative in the NE. With the continuing living contact with the people in NER, NEC will be singularly qualified to assess the capacity building requirements of administration. It is the most persistent and prominent theme of ARC recommendations. NEC should establish or promote Regional Training Institutions in virtually all disciplines including traditional institutions of self-governance, regulatory administration, forestry, agriculture, social services and such like. 6. ISC The NER has the unique privilege of having seven small district-like territories as States, besides Assam that once included three of them as Greater Assam. The interaction at the political, administrative and also peoples level, therefore, amongst the eight sisters is comparatively easier and also ubiquitous. The NEC is a prestigious body with all Governors and Chief Ministers of the Region as its members. Most of the disputes, therefore, should get resolved in informal parlays. Accordingly the need for intervention at the level of Inter State Council, if at all, will be rare. The presence of ISC itself, however, will be useful as it will serve as a distant monitor against transgressions. It will encourage concerned parties to resolve their disputes within the known high profile regional frame of NEC itself. 7. National Commission for Scheduled Tribes (NCST) According to the ARC, it is imperative that the focus (of NCST) remains on policy and larger issues of implementation It further called for appropriate measures to enable NCST to discharge its constitutional mandate. MoTA has accepted this recommendation. The most crucial Constitutional mandate, especially after PESA, that needs to be effectively overseen concerns in NER is village-level self-governance. The contribution of NCST in overseeing effective implementation not only in form but also in its true spirit can be crucial. The presence of NCST in NER, however, is rather weak. An official-level field organisation in the midst of high profile administrative and political leadership in every State cannot measure up to the task of overseeing implementation of Constitutional mandate. It is, therefore, necessary that NCST should establish a well-equipped field unit in Shillong for especially overseeing the compliance of constitutional mandates in NER. A member of NCST, preferably its Vice-Chairperson should head the Unit. The head quarter of member-in-charge may continue to be in Delhi but with a clear understanding that he will be in NER for no less
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than two weeks in a month. The member-in-charge should be a special invitee to all meetings of the NEC. The focus of NCST should shift from individual complaints to honouring of the Constitutional mandate. It may begin with focus on village level self-governance as envisaged in PESA. NEST should establish a well-equipped field unit in Shillong for NER with a member, preferably its Vice Chairperson, as its head. The ISC should continue. Its presence would serve as a distant warning signal that would encourage resolution of disputes in the informal setting of NEC. 8. North Eastern Hill University NEHU, the premier university of NER, should develop as a Center of advanced study in various faculties as recommended by ARC. But now every NE State has at least one Central University. These Universities must work in unison for optimum results. They must share a vision about their role in the context of the new challenge that NE presents in all spheres of human endeavour. Accordingly every University should specialize in a few branches and becomes a Center of excellence therein. They should also provide for inter-University exchange of students and faculty to engender a shared vision. A Council of North-Eastern Universities (CoNEU) should be established for this purpose. A formal resolution to this effect may be adopted by all NE Universities. NEHU should serve as the Convener of CoNEU (Theme Appendix 14). 9 Convergence of Regulatory and Developmental Programmes (Item 5h) What has been proposed above will lead to the emergence of a holistic frame with convergence of regulatory programmes. It holds the key for equitable development in the NE. But it is important the regulatory role of State itself should be perceived with a people-centric frame. All adverse forces that are engendered in the process of development and are racking many resource rich areas in the country relatable to industrialisation mining and even urbanisation must be checked in advance. A formal decadal plan as recommended by ARC may not serve much purpose. 10. Overall Perspective Effective functional relationship between the States with legacy of autonomous institutions on the one hand and the galaxy of ministries and other institutions at the national level is basic to the socioeconomic advancement of the people with vivacious diversity and inheritors of fabulous natural resources. The six major institutions that richly qualify to serve, severally and collectively, as a bridge in this crucial phase of realigning of the Constitutional
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frame have been identified. The scope of direct involvement of MoTA even in general tribal welfare programmes in NER has been limited. The Union Government has no formal role in respect of administration of tribal areas. The Governor is the last arbiter, albeit in consultation with Council of ministers. The benefit of the Constitutional mandate about grant-in-aid for raising the level of administration in the tribal areas under Article 275(1) has gone by default. MoTA in the new setting in association with DONAR and NEC should broaden its involvement in NER. Let Governors annual report to the President end the isolation of tribal areas. A time bound programme for raising the level of administration should become the harbinger of a new era of committed governance. A stage has been reached when DoNER should represent the collectivity of NER in the capital. It should have broad spectrum of technical capability to enter in meaningful dialogue with central establishment on behalf of and in association with every State in NER. NEC with direct link with DPCs below and Planning Commission above should be Chief Advisor of DoENR as also its representative in NER. NEC should establish or promote prestigious Regional Training Institutes. 11. Conclusion Lastly all these institutions \ must rise to the occasion and move in unison for achieving the national goal byreviewing and reinforcing the formal charter of DoNER (that was partially responsible for ARC recommendation about its abolition) with the objective of enabling it to represent the collectivity of NER in the capital; establishing organic links of NEC with DPC with its Planning Commission to NER under the guidance of the national Planning Commission. NEC should establish or promote Regional Training Institutions; resolving all disputes in the informal but congenial setting of NEC with ISC as a distant warning against transgressions; NCST to establish a strong field unit of NCST in Shillong for overseeing compliance of constitutional mandates in NER. The member-in-charge should be a special invitee to all meetings of the NEC; and NEHU developing as a Center of advanced study in various faculties working in unison with all other Universities in NER with the establishment of a Council of North-Eastern Universities (CoNEU) on the basis of a formal resolution to this effect being adopted by all NER Universities with NEHU serving as the Convener of CoNEU ------------------

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Annexures

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Annexure 1 THE PROVISIONS OF THE PANCHAYATS (EXTENSION TO THE SCHEDULED AREAS) ACT, 1996No.40 OF 1996 (24th December, 1996) An Act to provide for the extension of the provisions of Part IX of the Constitution relating to the Panchayats to the Scheduled Areas. Be it enacted by Parliament in the Forty-seventh Year of the Republic of India as follows:Short title 1. This Act may be called the Provisions of the Panchayats (Extension to the Scheduled Areas) Act, 1996 Definition 2. In this Act, unless the context otherwise requires, Scheduled Areas means the Scheduled Areas as referred to in Clause (1) of Article 244 of the Constitution. Extension of part IX of the Constitution 3. The provision of Part IX of the Constitution relating to Panchayats are hereby extended to the Scheduled Areas subject to such exceptions and modifications as are provided in section 4. Exceptions and modifications to part IX of the Constitution 4. Notwithstanding anything contained under Part IX of the Constitution, the Legislature of a State shall not make any law under that Part which is inconsistent with any of the following features, namely:(a) a State legislation on the Panchayats that may be made shall be in consonance with the customary law, social and religious practices and traditional management practices of community resources; (b) a village shall ordinarily consist of a habitation or a group of habitations or a hamlet or a group of hamlets comprising a community and managing its affairs in accordance with traditions and customs; (c) every village shall have a Gram Sabha consisting of persons whose names are included in the electoral rolls for the Panchayat at the village level;

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(d) every Gram Sabha shall be competent to safeguard and preserve the traditions and customs of the people, their cultural identity, community resources and the customary mode of dispute resolution; (e) every Gram Sabha shalli. approve of the plans, programmes and projects for social and economic development before such plans, programmes and projects are taken up for implementation by the Panchayat at the the village level; ii. be responsible for the identification or selection of persons as beneficiaries under the poverty alleviation and other programmes; (f) every Panchayat at the village level shall be required to obtain from the Gram Sabha a certification of utilisation of funds by that Panchayat for the plans, programmes and projects referred to in clause(e); (g) the reservation of seats in the Scheduled Areas at every Panchayat shall be in proportion to the population of the communities in that Panchayat for whom reservation is sought to be given under Part IX of the Constitution; Provided that the reservation for the Scheduled Tribes shall not be less than one-half of the total number of seats; Provided further that all seats of Chairpersons of Panchayats at all levels shall be reserved for the Scheduled Tribes; (h) the State Government may nominate persons belonging to such Scheduled Tribes as have no representation in the Panchayat at the intermediate level or the Panchayat at the district level: Provided that such nomination shall not exceed one-tenth of the total members to be elected in that Panchayat; (i) the Gram Sabha or the Panchayats at the appropriate level shall be consulted before making the acquisition of land in the Scheduled Areas for development projects and before re-settling or rehabilitating persons affected by such projects in the Scheduled Areas; the actual planning and implementation of the projects in the Scheduled Areas shall be coordinated at the State level; (j) planning and management of minor water bodies in the Scheduled Areas shall be entrusted to Panchayats at the appropriate level; (k) the recommendations of the Gram Sabha or the Panchayats at the appropriate level shall be made mandatory prior to grant of prospecting licence or mining lease for minor minerals in the Scheduled Areas; (l) the prior recommendation of the Gram Sabha or the Panchayats at the appropriate level shall be made mandatory for grant of concession for the exploitation of minor minerals by auction;
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(m) while endowing Panchayats in the Scheduled Areas with such powers and authority as may be necessary to enable them to function as institutions of self-government, a State Legislature shall ensure that the Panchayats at the appropriate level and the Gram Sabha are endowed specifically with(i) the power to enforce prohibition or to regulate or restrict the sale and consumption of any intoxicant; (ii) the ownership of minor forest produce; (iii) the power to prevent alienation of land in the Scheduled Areas and to take appropriate action to restore any unlawfully alienated land of a Scheduled Tribe; (iv) the power to manage village markets by whatever name called; (v) the power to exercise control over money lending to the Scheduled Tribes; (vi) the power to exercise control over institutions and functionaries in all social sectors; (vii) the power to control over local plans and resources for such plans including tribal subplans; (n) the State Legislations that may endow Panchayats with powers and authority as may be necessary to enable them to function as institutions of self-government shall contain safeguards to ensure that Panchayats at the higher level do not assume the powers and authority of any Panchayat at the lower level or of the Gram Sabha; (o) the State Legislature shall endeavour to follow the pattern of the Sixth Schedule to the Constitution while designing the administrative arrangements in the Panchayats at district levels in the Scheduled Areas. Continuance of existing laws on panchayats: 5. Notwithstanding anything in Part IX of the Constitution with exceptions and modifications made by this Act, any provision of any law relating to Panchayats in force in the Scheduled Areas, immediately before the date on which this Act receives the assent of the President, which is inconsistent with the provisions of Part IX with such exceptions and modifications shall continue to be in force until amended or repealed by a competent Legislature or other competent authority or until the expiration of one year from the date on which this Act receives the assent of the President; Provided that all the Panchayats existing immediately before such date shall continue till the expiration of their duration unless sooner dissolved by a resolution passed to that effect by the Legislative Assembly of that State or, in the case of a State having Legislative Council, by each House of the Legislature of that State. K.L. MOHANPURIA, Secy. to the Govt. of India
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Annexure 2 Relevant Constitutional Provisions Part IV 40. Organisation of village panchayats: The State shall 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 self-government. Part IX: The Panchayats 243. Definitions (g) village means a village specified by the Governor by public notification to be a village for the purposes of this Part and includes a group of villages so specified. 243A. Gram Sabha A Gram Sabha may exercise such powers and perform such functions at the village level as the Legislature of a State may, by law, provide. 243-I. Constitution of Finance Commission to review financial position. (1) The Governor of a State shall, as soon as may be within one year from the commencement of the Constitution (Seventy-third Amendment) Act, 1992, and thereafter at the expiration of every fifth year, constitute a Finance Commission to review the financial position of the Panchayats and to make recommendations to the Governor as to (a) the principles which should govern (i) the distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls and fees leviable by the State, which may be divided between them under this Part and the allocation between the Panchayats at all levels of their respective shares of such proceeds; (ii) the determination of the taxes, duties, tolls and fees which may be assigned to, or appropriated by, the Panchayats; (iii) the grants-in-aid to the Panchayats from the Consolidated Fund of the State; (b) the measures needed to improve the financial position of the Panchayats; (c) any other matter referred to the Finance Commission by the Governor in the interests of sound finance of the Panchayats.
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(2) The Legislature of a State may, by law, provide for the composition of the Commission, the qualifications which shall be requisite for appointment as members thereof and the manner in which they shall be selected. (3) The Commission shall determine their procedure and shall have such powers in the performance of their functions as the Legislature of the State may, by law, confer on them. (4) The Governor shall cause every recommendation made by the Commission under this article together with an explanatory memorandum as to the action taken thereon to be laid before the Legislature of the State. Article 243MPart not to apply to certain areas: (1) Nothing in this Part shall apply to the Scheduled Areas referred to in clause (1), and the tribal areas referred to in clause (2), of article 244. (2) Nothing in this Part shall apply to (a) the States of Nagaland, Meghalaya and Mizoram; (b) the hill areas in the State of Manipur for which District Councils exist under any law for the time being in force. (3) Nothing in this Part (a) relating to Panchayats at the district level shall apply to the hill areas of the District of Darjeeling in the State of West Bengal for which Darjeeling Gorkha Hill Council exists under any law for the time being in force; (b) shall be construed to affect the functions and powers of the Darjeeling Gorkha Hill Council constituted under such law. 1[(3A) Nothing in article 243D, relating to reservation of seats for the Scheduled Castes, shall apply to the State of Arunachal Pradesh.] (4) Notwithstanding anything in this Constitution, (a) the Legislature of a State referred to in sub clause (a) of clause (2) may, by law, extend this part to that State, except the areas, if any, referred to in clause (1), if the Legislative Assembly of that State passes a resolution to that effect by a majority of the total membership of that House and by a majority of not less than two-thirds of the members of that House present and voting; (b) Parliament may, by law, extend the provisions of this Part to the Scheduled Areas and the tribal areas referred to in clause (1) subject to such exceptions and modifications as may be
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specified in such law, and no such law shall be deemed to be an amendment of this Constitution for the purposes of article 368. Article 243A. Gram Sabha A Gram Sabha may exercise such powers and perform such functions at the village level as the Legislature of a State may, by law, provide. Part IXA: The Municipalities Article 243Q-Constitution of Municipalities (1) There shall be constituted in every State, (a) a Nagar Panchayat (by whatever name called) for a transitional area, that is area in transition from a rural area to an urban area; (b) a Municipal Council for a smaller urban area; and (c) a Municipal Corporation for a larger urban area, in accordance with the provisions of this Part:

to say, an

Provided that a Municipality under this clause may not be constituted in such urban area or part thereof as the Governor may, having regard to the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as he may deem fit, by public notification, specify to be an industrial township. (2) In this article, a transitional area, a smaller urban area or a larger urban area means such area as the Governor may, having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non-agricultural activities, the economic importance or such other factors as he may deem fit, specify by public notification for the purposes of this Part. Article 243 Empowers, authority and responsibilities of Municipalities, etc. Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow (a) the Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self-government and such law may contain provisions for the devolution of powers and responsibilities upon Municipalities, subject to such conditions as may be specified therein, with respect to (i) the preparation of plans for economic development and social justice;
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(ii) the performance of functions and the implementation of schemes as may be entrusted to them including those in relation to the matters listed in the Twelfth Schedule; (b) the Committees with such powers and authority as may be necessary to enable them to carry out the responsibilities conferred upon them including those in relation to the matters listed in the Twelfth Schedule. Article 243 ZC: Part not to apply to certain areas (1) Nothing in this Part shall apply to the Scheduled Areas referred to in clause (1), and the tribal areas referred to in clause (2), of article 244. (2) Nothing in this Part shall be construed to affect the functions and powers of the Darjeeling Gorkha Hill Council constituted under any law for the time being in force for the hill areas of the district of Darjeeling in the State of West Bengal. (3) Notwithstanding anything in this Constitution, Parliament may, by law, extend the provisions of this Part to the Scheduled Areas and the tribal areas referred to in clause (1) subject to such exceptions and modifications as may be specified in such law, and no such law shall be deemed to be an amendment of this Constitution for the purposes of article 368. Article 243 ZD: Committee for district planning (1) There shall be constituted in every State at the district level a District Planning Committee to consolidate the plans prepared by the Panchayats and the Municipalities in the district and to prepare a draft development plan for the district as a whole. (2) The Legislature of a State may, by law, make provision with respect to (a) the composition of the District Planning Committees; (b) the manner in which the seats in such Committees shall be filled: Provided that not less than four-fifths of the total number of members of such Committee shall be elected by, and from amongst, the elected members of the Panchayat at the district level and of the Municipalities in the district in proportion to the ratio between the population of the rural areas and of the urban areas in the district; (c) the functions relating to district planning which may be assigned to such Committees; (d) the manner in which the Chairpersons of such Committees shall be chosen.
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(3) Every District Planning Committee shall, in preparing the draft development plan, (a) have regard to (i) matters of common interest between the Panchayats and the Municipalities including spatial planning, sharing of water and other physical and natural resources, the integrated development of infrastructure and environmental conservation; (ii) the extent and type of available resources whether financial or otherwise; (b) consult such institutions and organisations as the Governor may, by order, specify. (4) The Chairperson of every District Planning Committee shall forward the development plan, as recommended by such Committee, to the Government of the State. Part XII Article 275: Grants from Union to certain States (1) 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 (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. 338A. (1) There shall be a Commission for the Scheduled Tribes to be known as the National Commission for the Scheduled Tribes.
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(2) Subject to the provisions of any law made in this behalf by Parliament, the Commission shall consist of a Chairperson, Vice-Chairperson and three other Members and the conditions of service and tenure of office of Chairperson, Vice-Chairperson and other Members so appointed shall be such as the President by rule determine. (3) The Chairperson, Vice-Chairperson and other Members of the Commission shall be appointed by the President by warrant under his hand and seal. (4) The Commission shall have the power to regulate its own procedure. (5) It shall be the duty of the Commission (a) to investigate and monitor all matters relating to the safeguards provided for the Scheduled Tribes under this Constitution or under any other law for the time being in force or under any order of the Government and to evaluate the working of such safeguards; (b) to inquire into specific complaints with respect to the deprivation of rights and safeguards of the Scheduled Tribes; (c) to participate and advise on the planning process of socio-economic development of the Scheduled Tribes and to evaluate the progress of their development under the Union and any State; (d) to present to the President, annually and at such other times as the Commission may deem fit, reports upon the working of those safeguards; (e) to make in such reports recommendations as to the measures that should be taken by the Union or any State for the effective implementation of those safeguards and other measures for the protection, welfare and socio-economic development of the Scheduled Tribes; and (f) to discharge such other functions in relation to the protection, welfare and development and advancement of the Scheduled Tribes as the President may, subject to the provisions of any law made by Parliament, by rule specify. (6) The President shall cause all such reports to be laid before each House of Parliament along with a memorandum explaining the action taken or proposed to be taken on the recommendations relating to the Union and the reasons for the non-acceptance, if any, of any of such recommendations. (7) Where any such report, or any part thereof, relates to any matter with which any State Government is concerned, a copy of such report shall be forwarded to the Governor of the State who shall cause it to be laid before the Legislature of the State along with a memorandum explaining the action taken or proposed to be taken on the recommendations relating to the State and the reasons for the non-acceptance, if any, of any of such recommendations.
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(8) The Commission shall, while investigating any matter referred to in sub-clause (a) or inquiring into any complaint referred to in sub-clause (b) of clause (5), have all the powers of a civil court trying a suit and in particular in respect of the following matters, namely: (a) summoning and enforcing the attendance of any person from any part of India and examining him on oath; (b) requiring the discovery and production of any document; (c) receiving evidence on affidavits; (d) requisitioning any public record or copy thereof from any court or office; (e) issuing commissions for the examination of witnesses and documents; (f) any other matter which the President may, by rule, determine. (9) The Union and every State Government shall consult the Commission on all major policy matters affecting Scheduled Tribes. Control of the Union over the administration of Scheduled Areas and the welfare of Scheduled Tribes. 339 (1) The President may at any time and shall, at the expiration of ten years from the commencement of this Constitution by order appoint a Commission to report on the administration of the Scheduled Areas and the welfare of the Scheduled Tribes in the States. The order may define the composition, powers and procedure of the Commission and may contain such incidental or ancillary provisions as the President may consider necessary or desirable. (2) The executive power of the Union shall extend to the giving of directions to a State as to the drawing up and execution of schemes specified in the direction to be essential for the welfare of the Scheduled Tribes in the State. 244. (1) The provisions of the Fifth Schedule shall apply to the administration and control of the Scheduled Areas and Scheduled Tribes in any State other than the States of Assam, Meghalaya, Tripura and Mizoram. (2) The provisions of the Sixth Schedule shall apply to the administration of the tribal areas in 2[the States of Assam, Meghalaya, Tripura and Mizoram.

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Annexure 3 FIFTH SCHEDULE [Article 244(1)] Provisions as to the Administration and Control of Scheduled Areas and Scheduled Tribes PART A GENERAL 1. Interpretation. In this Schedule, unless the context otherwise requires, the expression State does not include the States of Assam , Meghalaya, Tripura and Mizoram. 2. Executive power of a State in Scheduled Areas.Subject to the provisions of this Schedule, the executive power of a State extends to the Scheduled Areas therein. 3 Report by the Governor to the President regarding the administration of Scheduled Areas.The Governor of each State having Scheduled Areas therein shall annually, or whenever so required by the President, make a report to the President regarding the administration of the Scheduled Areas in that State and the executive power of the Union shall extend to the giving of directions to the State as to the administration of the said areas. PART B ADMINISTRATION AND CONTROL OF SCHEDULED AREAS AND SCHEDULED TRIBES 1. Tribes Advisory Council.(1) There shall be established in each State having Scheduled Areas therein and, if the President so directs, also in any State having Scheduled Tribes but not Scheduled Areas therein, a Tribes Advisory Council consisting of not more than twenty members of whom, as nearly as may be, threefourths shall be the representatives of the Scheduled Tribes in the Legislative Assembly of the State: Provided that if the number of representatives of the Scheduled Tribes in the Legislative Assembly of the State is less than the number of seats in the Tribes Advisory Council to be filled by such representatives, the remaining seats shall be filled by other members of those tribes. (2) It shall be the duty of the Tribes Advisory Council to advise on such matters pertaining to the welfare and advancement of the Scheduled Tribes in the State as may be referred to them by the Governor. The Governor may make rules prescribing or regulating, as the case may be,
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(3)

(a) the number of members of the Council, the mode of their appointment and the appointment of the Chairman of the Council and of the officers and servants thereof; (b) the conduct of its meetings and its procedure in general; and (c) all other incidental matters. 2. Law applicable to Scheduled Areas.(1) Notwithstanding anything in this Constitution, the Governor may by public notification direct that any particular Act of Parliament or of the Legislature of the State shall not apply to a Scheduled Area or any part thereof in the State or shall apply to a Scheduled Area or any part thereof in the State subject to such exceptions and modifications as he may specify in the notification and any direction given under this sub-paragraph may be given so as to have retrospective effect. (2) The Governor may make regulations for the peace and good government of any area in a State which is for the time being a Scheduled Area. In particular and without prejudice to the generality of the foregoing owner, such regulations may(a) prohibit or restrict the transfer of land by or among members of the Scheduled Tribes in such area; ( b) regulate the allotment of land to members of the Scheduled Tribes in such area; (c) regulate the carrying on of business as money-lender by persons who lend money to members of the Scheduled Tribes in such area. (3) In making any such regulation as is referred to in sub-paragraph (2) of this paragraph, the Governor may repeal or amend any Act of Parliament or of the Legislature of the State or any existing law which is for the time being applicable to the area in question. (4) All regulations made under this paragraph shall be submitted forthwith to the President and, until assented to by him, shall have no effect. (5) No regulation shall be made under this paragraph unless the Governor making the regulation has, in the case where there is a Tribes Advisory Council for the State, consulted such Council.

PART C SCHEDULED AREAS 6. Scheduled Areas.(1) In this Constitution, the expression Scheduled Areas means such areas as the President may by order3 declare to be Scheduled Areas.
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(2) The President may at any time by order4 (a) direct that the whole or any specified part of a Scheduled Area shall cease to be a Scheduled Area or a part of such an area; (a) increase the area of any Scheduled Area in a State after consultation with the Governor of that State; (b) alter, but only by way of rectification of boundaries, any Scheduled Area; (c) on any alteration of the boundaries of a State or on the admission into the Union or the establishment of a new State, declare any territory not previously included in any State to be, or to form part of, a Scheduled Area; (d) rescind, in relation to any State or States, any order or orders made under this paragraph, and in consultation with the Governor of the State concerned, make fresh orders redefining the areas which are to be Scheduled Areas; and any such order may contain such incidental and consequential provisions as appear to the President to be necessary and proper, but save as aforesaid, the order made under sub-paragraph (1) of this paragraph shall not be varied by any subsequent order. PART D AMENDMENT OF THE SCHEDULE 7. Amendment of the Schedule.(1) Parliament may from time to time by law amend by way of addition, variation or repeal any of the provisions of this Schedule and, when the Schedule is so amended, any reference to this Schedule in this Constitution shall be construed as a reference to such Schedule as so amended. (2) No such law as is mentioned in subparagraph (1) of this paragraph shall be deemed to be an amendment of this Constitution for the purposes of article 368.

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Annexure-4 SIXTH SCHEDULE [Articles 244(2) and 275(1)] Provisions as to the Administration of Tribal Areas in the States of Assam, Meghalaya, Tripura and Mizoram (Only the titles of the paragraphs of the Sixth Schedule are reproduced here to give an idea of the scope of its coverage in broad terms) 1. Autonomous districts and autonomous regions. 2. Constitution of District Councils and Regional Councils 3. Powers of the District Councils and Regional Councils to make laws 3A. Additional powers of the North Cachar Hills Autonomous Council and the Karbi Anglong Autonomous Council to make laws. 3B. Additional powers of the Bodoland Territorial Council to make laws. 4. Administration of justice in autonomous districts and autonomous regions. 5 Conferment of powers under the Code of Civil Procedure, 1908, and the Code of Criminal Procedure, 18981, on the Regional and District Councils and on certain courts and officers for the trial of certain suits, cases and offences. 6. Powers of the District Council to establish primary schools, etc. 7. District and Regional Funds. 8. Powers to assess and collect land revenue and to impose taxes. 9. Licences or leases for the purpose of prospecting for, or extraction of minerals. 10. Power of District Council to make regulations for the control of money-lending and trading by non-tribals. 11. Publication of laws, rules and regulations made under the Schedule. 12.Application of Acts of Parliament and of the Legislature of the State of Assam to autonomous districts and autonomous regions in the State of Assam
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12A. Application of Acts of Parliament and of the Legislature of the State of Meghalaya to autonomous districts and autonomous regions in the State of Meghalaya. 12AA. Application of Acts of Parliament and of the Legislature of the State of Tripura to the autonomous district and autonomous regions in the State of Tripura. 12B. Application of Acts of Parliament and of the Legislature of the State of Mizoram to autonomous districts and autonomous regions in the State of Mizoram. 13. Estimated receipts and expenditure pertaining to autonomous districts to be shown separately in the annual financial statement 14. Appointment of Commission to inquire into and report on the administration of autonomous districts and autonomous regions. 15. Annulment or suspension of acts and resolutions of District and Regional Councils. 16. Dissolution of a District or a Regional Council. 17. Exclusion of areas from autonomous districts in forming constituencies in such districts. *** 19. Transitional provisions. 20. Tribal areas. TABLE PART I 1. The North Cachar Hills District. 2. 6[The Karbi Anglong District.] 3. 7[The Bodoland Territorial Areas District.] PART II 1. Khasi Hills District.
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2. Jaintia Hills District.] 3. The Garo Hills District. PART III 1. The Chakma District. 2. The Mara District. 3. The Lai District. 20A. Dissolution of the Mizo District Council. 20B. Autonomous regions in the Union territory of Mizoram to be autonomous districts and transitory provisions consequent thereto. 20BA. Exercise of discretionary powers by the Governor in the discharge of his functions. 20BB. Exercise of discretionary powers by the Governor in the discharge of his functions. 20C. Interpretation. 21. Amendment of the Schedule

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Annexure - 5

Legislative Jurisdiction in Seventh Schedule (Article 246) List II-State List 5. Local government, that is to say, the constitution and powers of municipal corporations, improvement trusts, districts boards, mining settlement authorities and other local authorities for the purpose of local self-government or village administration.

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Annexure-6 Autonomous District/Regional Councils A. Legislative Domain of Autonomous District/Regional Councils 1. The Common Domain All District/Regional Councils are empowered, with approval of Governor, to make (i) Laws, vide Para 3, with respect to: allotment, occupation or use, of non reserved forest land, management of any non reserved forest, use of any canal or water-course for agriculture, regulation of Jhum or other forms of shifting cultivation; establishment of village or town committees and their powers; Other matter relating to village or town administration, including village or town police and public health and sanitation; appointment or succession of Chiefs or Headmen, inheritance of property, marriage, divorce and social customs. (ii) Rules, vide Para 5, inter alia, regarding constitution of village Councils or Courts the procedure to be followed and conduct of their business; (iii) Regulations, vide Para 6, for regulation and control of primary schools, dispensaries, markets, cattle pounds, ferries, fisheries, fisheries, roads, road transport and waterways as also, if the Governor so decides with the concurrence of the Council, in relation to agriculture, animal husbandry, community projects, cooperative societies, social welfare, village planning or any other matter to which the executive power of the State extends. a. Regulations, vide Para 10, for the control of money-lending and trading by nontribals; 2. The Additional Domain The District Councils in Assam are further empowered, with approval of Governor, to make Laws with respect to(a) 15 subjects, vide Para 3A, in the case of North Cachar Hills and Karbi Anglong Autonomous Districts and (b) 41 subjects, vide Para 3B, in the case of Bodoland Territorial Council Area. In case any law made under Paras 3, 3A or 3B relate to matters specified in List III of the Seventh Schedule, the Governor shall reserve the same for consideration by the President. 3. Harmonising Legislative Domains of Autonomous Councils and State Legislatures
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1. Meghalaya If any provision of a law under Para 3(1) or regulation under Para 8 or 10 of the 6th Schedule made by District Council is repugnant to any provision of a law made by State Legislature, the said law or regulation of the District Council, vide Para 12 A (a), to the extent of its repugnancy, shall be void. 2. Assam, Mizoram and Tripura No State law about matters specified in Para 3 and 3A of the 6th Schedule, or prohibiting or restricting the consumption of any non-distilled alcoholic liquor, shall extend to an Autonomous District Area unless the concerned Council in Assam, Mizoram or Tripura, as envisaged in Para 12 (1) (a), 12 B (a) and 12AA (a) respectively, directs to adopt the same as it is or with suitable modifications, if any. 4. Harmonising Other Central/State Laws in their Application to Autonomous Districts 1. Meghalaya: The President, with respect to any Act of Parliament may direct under Para 12A(b) that the same shall not apply to an autonomous district/region or shall apply with such exceptions or modifications as he may specify. 2. Assam: The Governor may direct under Para12 (b) that any Act of Parliament or of the State Legislature not covered by Para 12(a) shall not apply to autonomous district or shall apply with such exceptions or modifications as he may direct. 3. Tripura: (i) The Governor may direct under Para12AA (b) that any Act of State Legislature not covered by Para 12AA(a) shall not apply to autonomous district or shall apply with such exceptions or modifications as he may direct. (ii) The President, with respect to any Act of Parliament may direct under Para 12AA(c) that the same shall not apply to an autonomous district/region or shall apply with such exceptions or modifications as he may specify.

4.Mizoram: (i) The Governor may direct under Para12B (b) that any Act of State Legislature not covered by Para 12B(a) shall not apply to autonomous district or shall apply with such exceptions or modifications as he may direct.

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(ii) The President, with respect to any Act of Parliament may direct under Para 12B(c) that the same shall not apply to an autonomous district/region or shall apply with such exceptions or modifications as he may specify. B. Judicial powers of District/Regional Councils Constitute village councils or courts to the exclusion of any court in the State for trial of suits and cases between Scheduled Tribes, with certain exceptions. Appoint members and presiding officers of such village councils To act as, or constitute, separate courts of appeal. C. Executive powers of District/Regional Councils Executive functions of District/Regional Councils vary based on amendments made to the Sixth Schedule. Common range of executive functions for all Councils: Establish, construct and manage primary schools, dispensaries, markets, cattle pounds, ferries, fisheries, roads, road transport and waterways in the district may make regulations for their regulation and control. Prescribe the language and the manner in which primary education shall be imparted in the primary schools in the district. Functions that may be entrusted to Councils: Those relating to agriculture, animal husbandry, community projects, co-operative societies, social welfare, village planning or any other matter to which the executive power of the State extends E. Financial powers of District/Regional Councils Constitution of District/Regional Funds, to which all moneys received shall be credited Accounts to be maintained and audited by C&AG. Powers to assess & collect land revenue & impose taxes on lands & buildings, professions, trades, callings and employments, animals, vehicles and boats, on goods entering markets, tolls and for school, dispensary and road maintenance. Receive annually, a share of royalties from licenses or leases for prospecting or extraction of minerals as agreed with the Government. All estimated receipts and expenditure credited, to be first placed before the District Council for discussion and then shown separately in the annual financial statement of the State, laid before the Legislature *****
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Annexure 7 Role of Governor under Sixth Schedule Constitute, dissolve, or supersede district and regional councils, Redefine constituencies *Make Rules for the first constitution of a District/Regional Council in consultation with the existing tribal councils etc (3(6)) Enlarge or diminish powers of District/Regional Councils *To entrust, with the consent of any District Council, additional matters other than in Para 6(1), to the District Council that are within the executive power of the State According assent to laws, rules and regulations made by District/Regional Councils Annulment or suspension of acts and resolutions of District/Regional Councils. Arbitration in case of royalty from minerals between regional and district councils *To place one of the Ministers in charge of the welfare of the autonomous districts/councils in the State (14(3)) Appointment of Commission to inquire into and report on the administration of autonomous Districts/Councils Additional powers in Mizoram and Tripura: The Governor can prescribe period within which royalties on mineral extraction leases are to be shared between the State Government and the District Council. Use of Discretionary Powers by Governor: In Assam, the discretionary powers vested in the Governor under the 6th Schedule are to be exercised by him in his discretion under Para 20BA after consulting the Council of Ministers and North Cachar or the Karbi Anglong Autonomous District Council. In the case of Tripura and Mizoram, however, the Governor under Para 20BB shall consult the Council of Ministers but may consult the District/Regional Council only if he thinks it necessary. There are no specific provision in this regard in the case of Meghalaya and Bodoland Territorial Council in Assam.

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Annexure-8 No. N-11019/125/2009-Pol.1 Government of India Ministry of Panchayati Raj Krishi Bhavan, New Delhi-110001. Dated: 23.2.2010 From: A.N.P. Sinha, Secretary. To: Chief Secretaries, All States/UTs.

Subject: Efficient & simple Financial Management System and online transfer & tracking of Funds. Sir, Increasingly large amount of funds are being transferred under various schemes from Government of India (GOI) to the State Governments for further transmission to the Implementation Entities(IEs). The present system of accounting and financial management under these schemes is in urgent need of reforms for the reasons mentioned in Annex.I. Reforms are needed to: i) Reflect the changed content of programmes; ii) Enable tracking of actual expenditure (not merely the releases) with necessary details. iii) Provide timely and reliable Management Information, out of the huge magnitude and complexity of transactions, which is useful for monitoring and decision making; iv) Eliminate the large float in the system, due to the Special Purpose Entities (SPEs) created purportedly for efficient transfer of funds. v) Bring SPEs into the formal structure of accountability, including audit by CAG. 2. The Planning Commission along with Ministry of Finance, Controller General of Accounts (CGA), State Govts. and Comptroller & Auditor General (CAG) are working on the Central Plan Scheme Monitoring System (CPSMS) to address the above issues and to serve the objectives as listed in Annex.II. 3. Till such time the larger system under CPSMS is put in place, Ministry of Panchayati Raj (MoPR) has worked out a mechanism for efficient management of programmes, funds, and planning functions. The enclosed mechanism/guidelines (Annex.III), prepared for the purposes of MoPR, have been so designed that the same could be adapted easily by any Ministry for any programme irrespective of the nature of Ies. This mechanism infact offers a common platform that could be used for aggregation of information including for assessing
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inter-relationships among programmes and can be easily integrated into the CPSMS as & when it is rolled out. 4. The mechanism is based on switch over from the present system of Advances and Disbursement to a system of Authorization. In this framework, each IE would be given an Authorization for upto a certain amount based on their entitlement as per the programme guidelines, Authorisation would flow( refer enclosed flow chart) electronically through the Core Banking System (CBS) and be conveyed to the Designated Bank branch of the IE. Cheques issued by each IE(no self cheques) would be honoured by the Designated Bank within the Authorisation. This process would get facilitated by an internet based ICT application with requisite access control for security. 5. The CBS along with the Authorisation system, would not only address most of the problems mentioned in para 1 above but also enable vastly improved financial management and transparency as mentioned below : (a) At the click of the mouse, authority concerned will get information on both the Authorisations and the fund flows, through the CBS. (b) The CBS would report the actual payments ( not merely releases by the higher level) each day and the State funds would be debited accordingly. (c) Rapid authorization and payments to the Ies would be possible, as the new mechanism would eliminate the extensive paper work, clerical queries and resultant harassment down-the-line, avoiding delay in implementation, and the States/Ies enabled to use their full entitlement. (d) Transparency would be ensured by making information available on line in the public domain. This would also facilitate social audit. Citizens could report any discrepancy between the information displayed and the actual. (e) Ways and means position of both the Central and State Governments would improve as float/parking in the system would be eliminated. 6. It may be noted that there would be no need for SPEs as the proposed mechanism itself provides for efficient flow of funds and management of programmes. If for some reasons, the Union Ministries/State Govts. wish to continue with the existing SPEs, they could also adopt the proposed mechanism with appropriate modifications. 7. Debiting of the account of the State Governments by the Designated Bank automatically at the end of every day, should not cause any ways & means problems for the States since the expenditure would be within the funds already transferred by GoI. 8. Further, CAG alongwith MoPR, States, CGA and other stakeholders has formulated a Model Accounting System and formats for Panchayats which harmonize the Panchayat accounts with those of the Centre and the States. Corresponding accounting software application PRIASoft too has been developed which would facilitate easy deployment of these formats. PRIASoft formats could be adapted by the Union Ministries/State Deptts./Ies and also the existing SPEs ( if it is decided to continue with the SPEs). This would enable online tracking of actual expenditure in the required details and also an Integrated Financial Management System for all schemes.
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9. MoPR has also developed Plan Plus software which facilitates integrated (crosssectoral) District/Sub-District planning and seamless convergence of plethora of schemes and resources. This application will integrate with the new mechanism for fund transfer and provide an unified Planning, Accounting and MIS system. 10. Lastly, for enabling final payments to the beneficiaries, the Business Correspondents (BCs) option is being tried under various schemes. With the use of Electronic Benefit Transfer system and biometric based smart-card technology, the new mechanism is capable of integrating the BC model for the disbursal purposes. In fact Govt. of India has mooted BC model for the 97 unbanked Blocks (86 in NE alone) in the country for extending Banking services. 11. We would welcome your feedback/suggestions on refining/modifying the mechanism. Encls/-As above. Yours faithfully, ( A.N.P. Sinha) Copy to: Principal Secretaries, Panchayati Raj Deptts/Planning /Finance Deptts., All States/UTs.

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Annexure 9A

Comments received on revised draft note for CoS on Decentralised Governance in North Eastern States

Sl.No. Name of the Ministry 1. Ministry of Home Affairs 2. Ministry of Tribal Affairs 3. Ministry of Rural Development (Deptt. of Land Resources) 4. Ministry of Development of North Eastern Region 5. Ministry of Personnel, Public Grievances & Pensions (Deptt. of Administrative Reforms & Public Grievances) 6. Ministry of Urban Development Name of the States 1. Government of Sikkim

Comments not received on revised draft note for CoS on Decentralised Governance in North Eastern States

Sl.No. Name of the Ministry 1. Ministry of Law & Justice Name of the States 1. Arunachal Pradesh 2. Assam 3. Manipur 4. Meghalaya 5. Mizoram 6. Nagaland 7. Tripura

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Annexure 9B Comments of Ministries on revised draft note for CoS on Decentralised Governance in North Eastern States Sl.No. Name of the Comments Response of MoPR Ministry 1. Ministry of (i) The amendments proposed Noted. These are not part of the CoS Home Affairs in the CoS notes inter-alia include Note being circulated. new issues like, (a) provision of Council of Elders; and (b) constitution of a Village Justice Committee which require further consultation with the State Governments and the Councils; (ii) The proposal of taking out Tribal Village Council from the legislative jurisdiction of District Council is likely to affect the autonomy of the Sixth Schedule institutions. However, a decision in the matter could be taken by the District Councils. Incidentally, The Ministry of Home Affairs has been advocating with various outfits with whom Suspension of Operations (500) agreement have been entered that the Sixth Schedule framework would be able to meet most of their aspirations for a separate State; (iii) The question of enlarging the legislative domain of 3 Councils in Mizoram needs to be further examined, as the entire State has tribal population and the State Government is not in favour of enhancement of powers to the Councils. Our suggestions in the draft Cabinet Note would perhaps meet their aspirations. A sizeable portion of Assam is non-tribal and, they support more powers to the Councils as long as it mitigates the MoPRs purpose is to promote grassroots democracy and village level democratic bodies. So far, the District Councils have had legislative powers with respect to village Councils, but empowered institutions at the village level have not emerged. If District Councils continue to enjoy legislative powers regarding establishment and powers of village bodies, District Councils may make laws that go against village level democracy.

MHA has made two suggestions regarding strengthening of District Councils in its draft note: (i) Setting of SFCs to make recommendations for distribution of taxes etc. (ii) Provision of direct funding from Central Government to councils. There is no specific provision regarding Mizoram. MoPR has only proposed that the powers of these Councils be made on par with North Cachar and Karbi Anglong.
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demand for a separate State;

The first of these suggestions has been incorporated in MoPRs proposal. The second is not considered appropriate as it would mean by passing the State Governments. Consultation in the matter will be undertaken. However, local (iv) The proposal of extending democratic governance important in the Panchayati system of Part 9 of these areas as in other parts of the the Constitution to Hill Districts of country. Manipur is not supported unless the Tribal Bodies of Nagas and Kukis themselves accept/endorse this Consultations will be undertaken demand. with States. (v) In view of the above stated facts/comments, the Ministry of Panchayati Raj may consider the following: (i) The proposal in the Cos note be used as the basis for further consultations with the States/District Councils in the respective North Eastern States; (ii) Steps need to be taken to enhance the capacity of the Councils to handle the additional responsibilities and measures need to put in place to ensure proper utilization of funds; (iii) In order to evolve a broad consensus on the proposed changes, there is need to organize District Seminars in the respective States/Councils. (vi) Changes proposed in the MHAs Cabinet Note may be considered appropriately. (i) As per allocation of Business Rules, the work related to the Sixth Schedule has been allocated to the

Accepted

Consultations will be undertaken with the States.

Comments on MHAs proposal are at Annex 9C.

2. Ministry of Tribal Affairs

Noted

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Ministry of Tribal Affairs. but defacto the subject matter is being dealt by the Ministry of Home Affairs. This Ministry. therefore, is not in a position to pilot any Cabinet Note on issues relating to the amendment of Sixth Schedule. (ii) Likely mis-match between hereditary traditional structures of North East Councils vis-a-vis the provisions of the 73rd and 74th Amendments will have to be addressed. Autonomous Councils are traditionally clan dominated and often the leadership is heritable. This Ministry is not sure as to how this fact will gel with the concept of the 73rd and 74th Amendments which rest on pillars of elections and adult suffrage. However, we support the need to have an administrative and financial structure with guidelines that would lay down the extent of autonomy of the Autonomous Councils. This is needed to remove any apprehension in the minds of North East State Governments that Councils, if given full autonomy, may act irresponsibly and with no accountability. This would also mean that prior to actual implementation of the proposed amendments, an exercise to raise the skills of the members of the Autonomous Councils and also to improve the level of administration in the Council areas have to be initiated. Consultations with State Governments will be undertaken. The provisions of Articles 275(1) for raising the level of administration in tribal areas would need to be implemented as discussed in the CoS note. The need for capacity building of Autonomous Councils is also acknowledged.

(iii) The administrative structure Noted must include the involvement of the Central Ministries, either in the
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State level, or at the level of the Governor, to monitor and review the implementation of development/welfare schemes. (iv) In Schedule V areas, the Governors annual report has been Governors send annual reports to incorporated in the amendment the President of India, based on the proposal to the Sixth Schedule. advice of the Tribes Advisory Councils, through the Ministry of Tribal Affairs covering both the adherence to the constitutional provisions for the protection of Scheduled Tribes as well as development/welfare matters. Establishment of similar Advisory Council for each State based on whose reports the Governor can structure his/her Report should be included. (v) Comment regarding Forest Rights (Para B.iii p.10 -Revised for COS) seems to be too specific in the context of a note that is discussing larger issues. Ministry of Panchayati Raj may like to include those and similar other issues within the mandate of the decisions to be taken by the Councils/suggested Tribes Advisory Councils/at the level of Governors. Likewise, the provisions of Article 275(1) mentioned in Para 10 A (c)(iii) also appears to be too much of a detail. (vi) This Ministry feels that a note for the COS should follow an interaction with the North East States, Autonomous Councils and concerned Ministries. This issue has been flagged for the consideration of the High Powered Committee. Amendment of Article 275(1) is critical for improving governance in the region.

Consultation with North East States and Autonomous Councils would be undertaken. Ministries concerned have already been consulted.

(vii) The Parliamentary Committee Noted.

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3. Ministry of Rural Development (Deptt. of Land Resources) 4. Ministry of Development of North Eastern Region

on the welfare of SCs and STs has selected the subject "working of Sixth Schedule Areas in North East States". Lok Sabha Secretariat, has therefore, sought documents/material from the Ministry of Tribal Affairs on working of Sixth Schedule Areas in North East States. The Ministry of Tribal Affairs has furnished the background note received from the Ministry of Home Affairs and extract from the note on Decentralized Governance in North Eastern States received from the Ministry of Panchayati Raj. Department of Land Resources has Noted supported the CoS Note on Decentralised Governance in North East States.

5. Ministry of Personnel, Public Grievances & Pensions (DAR&PG) 6. Planning Commission

Ministry of DoNER has no Noted Consultations objection to the proposal on undertaken with States. condition that the concerned State Governments in the North East States are consulted and their comments be taken into consideration. Department of Administrative Noted. Reforms & Public Grievances (DoAR&PG) has stated that they have no comments to offer.

will

be

7. Ministry of Urban Development

The proposal is supported except No separate SFC has been proposed. for a separate State Finance SFCs are proposed to be set up only Commission (SFC) in States that have not already set these up. The Ministry is contemplating Noted. Consultations will be extension of Part IX A to Schedule undertaken with the States. V areas. For Amendments to Schedule VI areas, consultation with State Governments could be
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8. Government of Sikkim

considered as Local Bodies is a State subject. The State Government follows the Noted provisions of Part IX of the Constitution and supports the measures outlined in the CoS Note

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Annexure 9C Sl.No. Proposals in the MHA Note (i) Mandatory Village Councils/Village Development Board and Election to the Village Councils, Regional Councils and District Councils; Response of MoPR 1. MHAs proposed regarding the mandator y elected Councils have been incorporated in MoPRs proposal. However, MHAs proposal would does not provide for a Gram Sabha and its duties and therefore does not make space for peoples participation and accountability to the people, which is essential in the NE context, which has been addressed in MoPRs proposal. 2. MHA has proposed a uniform structure of Village Councils on the basis of adult suffrage as per para 2 of its draft Bill, but also proposed traditional bodies (Elkas, Town Committees, Village Council and Village Durbans) as well as Village Development Boards in para 3 if its draft Bill. These provisions are self contradictory. 3. MHAs proposal would create a contradiction between Section 2 and Section 3 Sixth Schedule. On the one hand provisions for elected Village Councils would be made in para 2, and on the other, as per para 3. Autonomous Councils would continue to have legislative powers regards the same, and could pass laws in contradiction. This problem has been addressed in MoPRs proposed. District Councils already enjoy legislative, administrative and judicial powers. The draft Bill provided by MHA does not clarify that the District Councils shall enjoy additional power as per the 11th Schedule. This has been addressed in MoPRs note. MoPRs proposal also contains extension of Municipalities as per Part IXA of the Constitution to the Schedule 6 areas. In addition, it provides additional provisions regarding special growth centres and zone of influence.

(ii) Extension of the provisions of the 73rd Amendments Act. Supplementing the existing powers so that additional powers and subjects included under the Schedule Eleven to the Constitution could be devolved to the ADCs/ACs; (iii) Extension of the provisions of the 74th Amendments Act. Supplementing the existing powers so that additional powers and subject included under the Schedule Twelve to the Constitution could be devolved to the ADCs/ACs setting up of municipal councils and election there do; (iv) Setting up of State Finance Commission to make the

This has been included in MoPRs proposal.

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While MHA has proposed that this role be performed by the Governor, MoPRs proposal makes this a Constitutional mandate as per C & AGs guidelines. (vii) Reservation for women in the This has been included in MoPRs note. Councils constituted under the Sixth Schedule; (viii) Enhanced powers to the Governor This has been included in MoPRs note. and the Central Government.

recommendations for distribution of taxes, tolls, duties etc. between the State and the District Councils; (v) Provisions for direct funding from the Central Government to the Councils; (vi) Administration and financial control and effective mechanism for audit of accounts of the councils;

It would not be appropriate to by-pass State Governments.

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