ANALYSIS OF THE HEIRARCHIAL SETUP BETWEEN CENTRAL AND

STATE GOVERNMENT OVER POWER TO LEGISLATE

Research Paper submitted to Himachal Pradesh National Law University

Shimla

Course In-charge Submitted by

Dr. S.S. Jaiswal Mahima Prajapati
Registrar HPNLU

HIMACHAL PRADESH NATIONAL LAW UNIVERSITY, SHIMLA

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ACKNOWLEDGEMENT

I wish to recognize my appreciation to Dr. S.S. Jaiswal my educator and guide for the profitable
direction. It is his lighting up remarks and proposals, which have empowered me to effectively
total my work. I additionally express my significant feeling of appreciation and much obliged
towards him

I truly thank the colleagues and school custodian for their co-activity and help. On account of my
partners and companions who have upheld me.

MAHIMA PRAJAPATI

(LL.M 5020192021)

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 TABLE OF CONTENTS
1. ABSTRACT .......................................................................................................................................... 4

2. INTRODUCTION ................................................................................................................................ 5

3. FEDERAL AND UNITARY FEATURES OF INDIAN CONSTITUTION ....................................... 6

A. The federal features of the constitution of India ............................................................................... 6

a. Dual polity .................................................................................................................................... 6

b. Written constitution ...................................................................................................................... 6

c. Divisions of powers ...................................................................................................................... 6

d. Supremacy of The Constitution .................................................................................................... 6

e. Rigid constitution .......................................................................................................................... 6

f. Independent Judiciary ................................................................................................................... 7

B. The Unitary features of constitution of India .................................................................................... 7

a. Strong Centre ................................................................................................................................ 7

b. States Not Indestructible ............................................................................................................... 7

c. Single Constitution........................................................................................................................ 7

d. Flexibility of The Constitution...................................................................................................... 8

e. Single Citizenship ......................................................................................................................... 8

f. No Equality of State Representation ............................................................................................. 8

4. THE UNION AND STATE RELATIONS IN THE CONSTITUTION OF INDIA ............................ 8

A. Distribution of Powers between legislative, administrative, financial .............................................. 9

a. LEGISLATIVE RELATIONS[Article (245-255)] ....................................................................... 9

b. ADMINISTRATIVE RELATIONS [Article(256-263)]............................................................. 11

c. FINANCIAL RELATIONS[Article (268-293)] ......................................................................... 13

B. Financial Relation During Emergency ............................................................................................ 15

CONCLUSION ........................................................................................................................................... 15

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1. ABSTRACT

Perhaps the most remarkable achievement of Indian constitution is to confer upon a federal
system the strength of a unitary government. Though normally the system of government is
federal, the constitution enables the federalism to transform itself into a unitary state such a
combination of federal and unitary system in the same constitution is unique in the world. The
essence of federalism lies in the sharing of legal sovereignty by the union and the federating unit
and the most appropriate way of the federation and federating units is to demarcate their
respective areas in regard to legislation.

Constitution are either unitary or federal in the unitary constitution the powers of government
are centralized the powers in one government i.e. the central government whereas in federal
constitution there is a division of power between the central and state government and both are
independent in their own spheres. the question of division of powers and responsibilities between
the center and the states has cropped up in several new legislative proposals. The constitution
provides for a scheme for demarcation of powers through three lists in the Indian constitution.

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2. INTRODUCTION

Political scientists have divided governments into federal and unitary governments on the basis
of the structure and ties of the national and regional governments. Through default, a unitary
state is one in which all powers are bestowed upon the national and regional governments, if any,
by the national government. The federal government, on the other hand, is one in which powers
are divided between the national government and the regional government by the constitution
itself and both operate independently in their respective jurisdictions.1
The United Kingdom, Japan, France, China, Italy, Belgium, Norway, Sweden, Spain and so on h
ave a unitary government model, while the United States, Germany, Australia, Canada, Russia, B
razil, Argentina and so on have a federal government model. The expression "federation" is
derived from the Latin word ‘Foedus’ meaning ‘treaty' or agreement. The union is therefore a
new state established by a treaty or agreement between the various units.2 A union can be formed
in two ways, that is, by unification or disintegration. In the first example, a number of
economically weak and economically backward states come together to form a big and a strong
union. The constitution of India provides for a federal government system in the country. The
frameworks have adopted the federal government for two main reasons, namely the large size of
the country and its socio-cultural diversity. However, the term ' federation' has never been used
in the constitution. Alternatively, Article 1 of the Constitution describes India as a' Union of
States'.3
According to K.C.Wheare “federation means the method of dividing powers so that the general
and regional governments are each within a sphere co-ordinate and independent. Both the federal
and the regional governments are co-ordinate and independent in their spheres not subordinate to
one another.4
The Indian federal system is based on the' Canadian model' and the' American model.' The'
Canadian Model' varies significantly from the' American Model' in so far as it has a very strong
core. The Indian Union is similar to the Canadian Federation, firstly in its creation (i.e. by
disintegration); secondly, in its adherence to the word ' unity' (the Canadian federation is also

1
http://interstatecouncil.nic.in/wp-content/uploads/2015/06/volume1.pdf (last visited September 14,2019)
2
Ibid
3
Constituent Assembly Debates, volume VII, P.43
4
http://www.nmu.ac.in/Portals/46/SLM/LL.%20M.%20Paper-II.pdf (last visited on September 15, 2019)

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called a union’); and lastly in its centralizing tendency i.e. (vesting powers in the Centre vis-à-vis
the states).5
3. FEDERAL AND UNITARY FEATURES OF INDIAN CONSTITUTION
A. The federal features of the constitution of India
a. Dual polity
The Constitution creates a dual system consisting of a union at the Center and a union at the
frontier. Each is invested with sovereign powers to be exercised in the area entrusted to
them by the Constitution. Union governments deal with issues of national importance, such
as security, foreign affairs, currency, communications, and early.

b. Written constitution
The constitution is not only a written document; it is also the longest constitution in the
world. It originally included a preamble, 395 articles (divided into 22 parts) and 8 schedules.
This defines the structure, departments, powers and duties of both central and state
governments and prescribes where they are to operate.

c. Divisions of powers
The Constitution separated the powers between the Center and the States in terms of the
Union list, the State list, the subordinate list in the Seventh Schedule. The union list consists
of 100 subjects and the state list of 61 subjects and the concurrent list of 52 subjects. Both
the Center and the State that make laws on the subjects of the concurrent list, but central law
prevails in the event of a conflict.6

d. Supremacy of the Constitution

The constitution is supreme law of the land. The laws enacted by Centre and the states must
confirm to its provisions. Otherwise, they can be declared invalid by the Supreme Court or
the high courts through their power of judicial review.

e. Rigid constitution
The division of powers established by the constitution as well as the supremacy of the
constitution can be maintained only if the method its amendment is rigid. Hence, the

5
Ibid
6
Laxmikanth M., Indian Polity 13.2(McGraw Hill Education (India) Private Limited, Tamil Nadu,5thedn., 2018).

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 constitution is rigid to the extent that those provisions which are concerned with federal
structure can be amended only by the joint action of the central governments and state
governments.7

f. Independent Judiciary
The Constitution creates an independent judiciary headed by the supreme court with two
purposes: firstly, to preserve the constitution's authority by exercising the right of judicial
review and, secondly, to settle disputes between the center and states or between states.”8

B. The Unitary features of constitution of India

“Beside the above federal features, the Indian constitution also possesses the following unitary
or non-federal features; -
a. Strong Centre
The division of power is in favor of the Center and from the national viewpoint is particularly
inequitable. First, the list of countries covers more subjects than the list of states. Secondly,
the more important subjects have been included in the union list. Third, the Center has
absolute control on the database at the same time. Finally, the residuary powers have also
been left with the Centre.9

b. States Not Indestructible

The states of India have no claim of territorial integrity, unlike in other federations. The
parliament may change the territory, borders, or name of any state through unilateral action.
In addition, it only takes a simple majority. The Indian federation is therefore an
"indestructible union of destructible nations."10

c. Single Constitution
The states typically have the right to create their own constitution differently from that of the
Centre in a federation. In India, on the contrary, the states are not granted such power. India's
constitution embodies not only the Center's constitution, but also the states' constitution.

7
Ibid
8
Ibid
9
Ibid
10
https://www.academia.edu/12407655/Centre-state_relations_in_India_Time_for_a_new_framework (last visited
September 19, 2019)

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 d. Flexibility of the Constitution
The constitutional amendment system is less restrictive than what is found in other
federations. By direct legislative legislation, either by a simple majority or by a qualified
balance, the majority of the constitution can be modified.11

e. Single Citizenship
Despite a dual polity, India's constitution, like Canada's, has introduced a single nationality
structure. There is only Indian citizenship, and there is no independent nationality.

f. No Equality of State Representation

The states are given population-based representation in the Rajya Sabah. The membership
therefore varies from 1 to 31. In the United States, on the other hand, the principle of equal
representation of the upper house states is completely reorganized.”12
Case quoted:
S R Bommai V. Union of India (1994)
The Supreme Court lay down that the constitution is federal and characterized federalism as
its “basic feature’. It observed the fact that under the scheme of our constitution greater
powers are conferred upon the centre vis-à-vis the states does not mean that the states are
mere appendages of the centre. The states have an independent constitutional existence. They
are not satellites or agents of the centre, within the sphere allotted to them, the states are
supreme.

4. THE UNION AND STATE RELATIONS IN THE CONSTITUTION OF INDIA

The constitution of India, being federal in structure, divides all powers between the Centre and
states. However, there is no division of judicial power as the constitution has established an
integrated judicial system to enforce the central laws as well as state laws. Though Centre and
the states are supreme in their respective fields, the maximum harmony and coordination
between them is essential for the effective operation of federal system. India is a union of states.
The constitution of India has divided the legislative, executive and financial powers between the

11
Ibid
12
Supra Note 6

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center and the states, giving the country a federal character, while the judiciary is incorporated
into the hierarchical structure.13

A. Distribution of Powers between legislative, administrative, financial

The Centre and state relations are divided into three parts under Indian constitution which are
explained below: -
(A) Legislative relations Article (245-255)
(B) Administrative relations Article (256-263)
(C) Financial relations Article (268-293)

a. LEGISLATIVE RELATIONS [Article (245-255)]

Article 245 to 255 in part XI of the Indian constitution deal with the legislative relations between
the Centre and states. The constitution provides for the parliamentary legislation in the state field
under five extraordinary situations as well as the Centre’s control over state legislation in certain
cases.14
Thus, there are division of function between Centre and state legislative relations, viz.,
A. Territorial extent of central and state legislation
B. Distribution of legislative subjects
C. Parliamentary legislation in the state field and
D. Centre’s control over state legislation
i. Territorial extent of Central and State legislation
“The Constitution defines the territorial limits of the legislative powers vested in the Centre and
the states in the following way:
 The Parliament can make laws for the whole or any part of the territory of India. India's
jurisdiction includes the provinces, the territories of the union, and any other area
presently included in India's territory.15
 For the whole or any part of the state, a state legislature may make laws. Unless there is
an appropriate connection between the government and the item, the laws made by a state
legislature are not valid outside the country.

13
https://www.jagranjosh.com/general-knowledge/unionstate-relations-centrestate-relations-1438065901-1 (visited
on September 18, 2019)
14
Ibid
15
Ibid

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  The Parliament alone can make ‘extra-territorial legislation’. Thus, the laws of the
Parliament are also applicable to the Indian citizens and their property in any part of the
world.”16
ii. Distributions of legislative subjects
The Constitution provides for a threefold allocation between the Centre and the states for
constitutional matters, viz., list I (the union list), list II (the state list), list III (the concurrent list)
in the seventh schedule:
“The Union List includes topics of national importance and concerns requiring national
uniformity in legislation, The State List identify issues of regional and local significance and
topics that allow for plurality of concern, Issues on which country-wide uniformity of law is
ideal but not necessary are listed in the document at the same time.
Union list 100 items (Center-only authority) Subjects such as Defense, banking, foreign
affairs, currency, nuclear power, insurance, communication, inter-state trade and trade, census,
audit, etc.
Concurrent list 52 issues (Center & State Authority) Subjects such as Legal and Procedural
Law, Civil Procedure, Marriage and Divorce, Population and Family Planning, Power, Welcome
Employment, Economic and Social Policy, Food, Newspapers, Books and Printing Press, and
others (5 items added to the Concurrent List by 42 amendments; viz. Health, Forests, Courts,
Weight &
State List has 61 Items This has at present 61 subjects (originally 662 subjects) like public
order, police, public health and sanitation, agriculture, prisons, local government, fisheries,
markets, theaters, gambling and so on.
List prevalence
The Constitution expressly specifies the predominance of the Union List over the State List and
the Concurrent List over the State List In the event of a conflict between the Central Law and the
State Law on a topic mentioned in the Concurrent List, the Central Law prevails over the State
Law.
There's an exception, though. If the state law is reserved for the president's approval and his
permission has been obtained, then the state law prevails in that country. Yet Parliament would
still have authority to circumvent such a law by then making a law on the same subject.”17

16
https://upscdiary.com/the-static-content/centre-state-relations-in-india/ (visited on September 22, 2019)

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 iii. Parliamentary legislation in the state field
“Under certain conditions, the constitution authorizes the government of the union to extend its
jurisdiction over matters covered by the state list viz.
When an emergency proclamation is in effect, Parliament may legislate on matters covered by all
3 lists
Article 356 On the collapse of constitutional structure in the country, Parliament may take over
the legislative authority of the government
Article 249 states that Rajya Sabah can move any subject on the state list to parliamentary
legislative authority by a resolution adopted by 2/3 of the majority.
Article 252 If the legislature of two or more States adopts a resolution specifying that a suitable
law is passed by the parliament on any matter mentioned in the list of States, the parliament may
make laws governing that matter. Any other State may also enact such legislation by introducing
a bill, but such laws may be modified or revoked by Parliament only.
Article 253 This authorizes Parliament to make laws for the execution of international
agreements and conventions for whole or any portion of Indian territories, even if the subjects
protected by such treaties and agreements fall within the scope of the State system.”18
iv. Central control over state legislation
“The Constitution empowers the Center to exercise control over the constitutional affairs of the
state in the following ways: for the benefit of the Governor, the governor may designate those
forms of bills passed by the state legislature. They enjoy the president's absolute veto.
In the state legislature, legislation on certain matters mentioned in the State List can only be
adopted with the president's prior approval. (For example, bills that limit commerce and export
freedoms).
The President can order states to reserve money bills and other financial bills that the state
legislature has passed for consideration during a financial emergency.”19

b. ADMINISTRATIVE RELATIONS [Article (256-263)]

“Article 256-263 of part XI of Indian constitution deals with the administrative relations between
Centre and state. There is various other article which deals with the same matter.

17
Ibid
18
Ibid
19
Ibid

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The administrative relation between the centre and State works in such a manner that the
dominance of the Center is more than evident. The Indian federal system may be suspended or
compressed into a unitary process during emergencies. But even in normal times, through its
powers of delegation, guidance and grants in India, the Center can descend upon the government.
The article 246, 256, 257,263 are the weapons by which the administrative actions shall run
smoothly as per the wish of The Centre.
Article 256of the Indian constitution lays out and points out the respective duties of the Union
and the governments of the states. The executive power of each State shall be exercised in such a
manner as to ensure compliance with the laws of the Parliament and any existing laws applicable
in that State and the executive power of the Union shall apply to the State as may seem
appropriate to the Government of India for that reason.
Article 257 makes the situation explicit when it says: “The executive power of every state shall
be so exercised as not to impede or prejudice the exercise of the executive power of the Union,
and the executive power of the Union shall extend to the giving of such directions to a state as
may appear to the Government of India to be necessary for that purpose.”

Article 275 maintains that the Parliament has the power to make grants as it may deem necessary
to give financial assistance to states which is in need of such assistance. Through the grants, the
Union would be in a position to redress inter-state inequalities in financial resources that are not
beneficial to the country's overall development, and also to exert national influence and
cooperation over the state welfare schemes.20
Article 263 empowers the President of India to set up national public interest inter-state
councils. The council may have the duty to investigate and report on conflicts between states that
may occur. The President has set up a Central Health Council, a Local Self-Government Central
Council, and a Transport Planning Council to formulate the states ' action on these issues.
The shared assignment of duties (Article 73) and the exemption from collective taxes (Articles
285 and 289) eventually lead to the extension of the legislative authority of the Union
Government in matters relating to the States.”21

20
http://www.yourarticlelibrary.com/india-2/administrative-relations-between-the-center-and-the-states/45909
(visited on September 28,2019)
21
ibid

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 c. FINANCIAL RELATIONS [Article (268-293)]
The constitution of India deals with financial relations between Centre and state within article
(268-293) of part XII. The constitution divides the taxing powers between the Centre and the
states in the following way:
 The parliament has exclusive power to levy taxes on subjects enumerated in the union
list.
 The state legislature has exclusive power to levy taxes on subjects enumerated in the state
list.
 Both the parliament and the states legislature can levy taxes on subjects enumerated in
the concurrent list.
 The residuary power of taxation is vested in parliament under the provisions, the
parliament has imposed gift tax, wealth tax and expenditure tax.22
i. The distribution of tax revenue between the union and states
1. Taxes belonging to the union exclusively
Customs, Corporate Tax, Capital Value Payments for Individuals and Companies, Income
Tax Supplement and Revenue Fees
2. Taxes belonging to the states exclusively
Land Tax, Stamp Duty except in reports included in the Union Register, Succession
Responsibility, Property Duty, and Agricultural Land Income Tax, Passenger and Inland
Waterway Fees, Mineral Rights. Taxes on livestock and boats, road vehicles, ads, electricity
consumption, luxuries and entertainment, etc. (This is complemented by a new VAT system).23
3. Duties levied by the union but collected and appropriated by the states
Stamp duties on trade bills, etc., and specific duties on alcohol-containing health and toilet
Arrangements under (Article 268).

4. Taxes imposed as well as received by the Union or delegated to States within which Levi
entitled

22
https://iipa.org.in/upload/Theme_Paper_Dolly_Arora_2014(_for_website-9-1-15.pdf (last visited September 29,
2019)
23
Ibid

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The Property duties other than agricultural land, Taxes on properties other than agricultural land
on goods and passengers carried by road, air or sea on train or freight fares and so on.24
5. Taxes collected and assessed by the Union and allocated between the Union and the
State
certain taxes are levied and received by the Union, but their revenues are to be shared to a certain
degree between the Union and the States in order to ensure a fair distribution of The Financial
resources.
These are:
 Income taxes other than agricultural income (Article 270)
 Excise duties as included in the Union Register, with the exception of medical and toilet
provisions, may also be levied, so that Parliament so requires (Article 272).
ii. The Distribution of Non-Tax Revenues between Centre and state
 Surcharge on certain taxes (Art.271):“Parliament is allowed to levy the surcharge on
the taxes alluded to in the latter two sections (Art.369 and Art.370) and the revenues of
such surcharges go directly to the Center and cannot be distributed.
 Taxes raised and maintained by the States: these are the taxes mentioned in the State
List (number 20) and belong solely to the States.
 Grants-in-Aid: Parliament can grant aid from the Consolidated Fund of India to States in
need of assistance (Article 275), in particular to promote tribal welfare, including special
grant to Assam.”25
1. Freedom of transport, trade and intercourse in India is guaranteed in compliance with
Article 301, but Parliament has the power to impose limitations in the public interest.
2. Although the Union levies income taxes other than agricultural profits, the state
legislatures may levy taxes on employment, commerce, etc.26
3. Distribution of non-tax income: non-tax income from postal and telegraph systems,
highways, banking, telecommunications, coinage and currency, federal public sector
companies and escheat (death of a man without a heir) and lapse (Droit adminstratif) go

24
Ibid
25
https://www.civilsdaily.com/financial-relations-between-centre-and-state-art-268-to-293/ (visited on September
30, 2019)
26
Ibid

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 to the Union, while the State collects non-tax income from agriculture, forestry, fisheries,
the public sector and the public sector.27

B. Financial Relation during Emergency

The Centre and state financial relations in normal times undergo changes during emergency.
These are as follows;
National emergency
Under Article 352, if the president is convinced that a serious situation exists in which the
country's security is threatened on the grounds of war, internal invasion or armed rebellion, he
may declare an emergency for that reason. Emergency can be proclaimed in India's entire
territory or any portion of it. Only on cabinet written recommendations can the President declare
an emergency. A special vote is required to pass an emergency resolution. After authorization,
emergency operations shall not extend six months.28
State emergency
On the presidential-state government is opposed and the center retains the executive power of the
state. On Legislature-State legislature does not act to legislate; it either suspends or dissolves the
state legislative body. On Financial Relationship-There is no effect on financial resource
distribution between the center and the government.29
Financial Emergency
Under article 360- If the President is satisfied that a situation has arisen whereby the financial
stability or credit of India or of any part of the territory thereof is threatened, he may by a
Proclamation make a declaration to that effect. This emergency is never imposed in India.30

CONCLUSION
In India, the Centre-States relations constitute the core elements of the federalism. The Central
Government and State Government cooperate for the well-being and safety of the citizens of
India. They work together in the field of environmental protection, terror control, family control

27
https://shodhganga.inflibnet.ac.in/bitstream/10603/86844/11/11_chapter%203.pdf (last visited September
30,2019)
28
https://www.jagranjosh.com/general-knowledge/emergency-provisions-in-indian-constitution-1437625665-1
(visited on October 5,2019)
29
Ibid
30
Ibid

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and socio-economic planning. The Indian constitution aim at reconciling the national unity while
giving the power to maintain state to the State governments. It is true that the union has been
assigned larger powers than the state governments, but this is a question of degree and not
quality, since all the essential features of a federation are present in the Indian constitution. It is
often defined to be quasi-federal in nature. Thus, it can be safely said that Indian Constitution is
primarily federal in nature even though it has unique features that enable it to assume unitary
features upon the time of need. Federal but its spirit is unitary.
To conclude, the ‘Union of States’ model of Indian federalism, following the events of the
eighties and early nineties, had started showing signs of both resilience and flexibility. Although
the Central Government continues to be strong and continues to maintain its pre-eminence,
attempts are in progress to strengthen the States through various federal mechanisms. It was
visualized that the system of coalition-governance at the Central level by giving direct
representation to powerful regional parties and ensuring their involvement in the decision
making on National issues was a sound step to easing of tensions between the federal
Government and the States. Through the process of economic reforms, the federal Government
started the dispensation of National power and resources to the regions. In order to meet the
imperatives of good governance, fiscal discipline on the part of the Union and the States is also
increasingly underlined.

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