In 1992, one of the biggest changes in the Indian constitutional scheme was introduced. It introduced a third teir of Government in India in the form of Panchayats and Urban Local bodies through 73^rd and 74^th Constitutional amendment respectively. In this chapter we shall study the local government in Rural areas of India, viz. the Panchayati Raj system.

Articles Related to Panchayats at a Glance

The 73^rd Amendment Act introduces Articles 243 to 243O, making provisions for the constitution of Gram Sabha (Village assembly), Panchayats, Local Taxation, Powers of the Panchayats and  provision for the local elections.

Article No.	Subject-Matter
243	Definitions
243A	Gram Sabha
243B	Constitution of panchayats
243C	Composition of panchayats
243D	Reservation of seats
243E	Duration of panchayats
243F	Disqualifications for membership
243G	Powers, authority and responsibilities of panchayats
243H	Powers to impose taxes by the panchayats
243-I	Finance Commission
243J	Audit of accounts of panchayats
243K	Elections to the panchayats
243L	Application to union territories
243M	Part not to apply to certain areas
243N	Continuance of existing laws and panchayats
243O	Bar to interference by courts in electoral matters

1.Gram Sabha(243(A)):

• The very basic unit of the Panchayati system is the Gram Sabha. It has been defined in the Article 243 as the body of all the persons registered on the electoral rolls of a village.
• This is a permanent body of the electorate. It consists of persons registered in the electoral rolls of a village comprised within the area of panchayat at the village level.
• However, membership in a Gram Sabha is restricted to persons above 18 living in that village. This is done so that the best decisions, which align with the village’s interests, can be made.

Intermediate-level PanchayatsExist in states where the population exceeds 20 lakhs.  

2. Three-Tier System:

• Article 243B provides for the establishment of a 3-tier Panchayati system.
• Gram Panchayat is the lowest level in the panchayat pyramid system. The act brings uniformity in the structure of panchayati raj throughout the country.

2.1.Gram Panchayat:

• Each village is divided into smaller units called wards, each selecting a representative. They are called Ward members or the Panch.
• The Gram Sabha also elects the head of the Gram Panchayat, called the sarpanch. Therefore, the Sarpanch and the Panch together make up the Gram Panchayat.

Functions:

• The main work of the Gram Panchayat is to take care of social issues, construct and maintain schools, roads, drainage facilities, etc., and levy and collect local taxes.
• The Gram Panchayat is accountable to the general body of voters in the village, i.e. the Gram Sabha, and to the two levels of authority above it in the hierarchy.

2.2.Panchayat Samiti

• The Panchayat Samiti is the next level in the hierarchy. It supervises the working of the Gram Panchayats of all the villages in the block under its jurisdiction.
• The Pradhan heads the Panchayat Samiti. He/she is elected by a group consisting of all the members of the Panchayat Samiti and all the Panchs of the Gram Panchayats coming under it.

2.3.Zila Parishad (District Panchayat)

• This is the highest level of panchayat in the hierarchy of rural self-government.
• The chairman heads the Zila Parishad.
• It also has a Chief Executive Officer as a member, who the State government elects.

Functions:

• It oversees the working of the Panchayat Samitis of all the blocks in the district of its jurisdiction and all the Gram Panchayats under them.
• It controls the distribution of funds among all the Gram Panchayats. It is responsible for making developmental plans at the district level. 

3. Election of Members and Chairpersons(243K):

• The eligible voters in the area elect all the members of the three levels in the panchayat hierarchy.
• However, the state can also make provisions for representing Members of the Legislative Assembly (MLAs) or other officials in the panchayat.
• As for the rules regarding the composition of the panchayats, they have been taken care of by the Drafters under Article 243C of the Constitution.
• All the members of panchayats at the village, intermediate and district levels shall be elected directly by the people.
• The chairperson of panchayats at the intermediate and district levels shall be elected indirectly by and from amongst the elected members.
• However, the chairperson of a panchayat at the village level shall be elected in such manner as the state legislature determines.
• The chairperson of a panchayat and other members of a panchayat elected directly or indirectly shall have the right to vote in the meetings of the panchayats.

4. Reservation of seats in Panchayats(243D):

• The Drafters of our Constitution were aware of the rampant discrimination in India at the time of independence. Keeping that in mind, they made special provisions to represent marginalised communities in the local self-government.
• Article 243D of the Indian Constitution provides provisions for reserving panchayat seats for certain communities.
• Seats should be reserved for members of Scheduled Castes and Scheduled Tribes (at all three levels)in the panchayat in the same proportion that their population bears to the total population of the village.
• The act provides for reserving one-third of the total number of seats for women (including the number of seats reserved for women belonging to the S.C.s and S.T.s).
• Further, one-third of the total number of offices of chairpersons in the panchayats at each level shall be reserved for women.
• Further, the state legislature shall provide for the reservation of offices of chairperson in the panchayat at the village or any other level for the S.C.s and S.T.s.

NOTE

The above provision relating to reserving seats in panchayats (both members and chairpersons) for the scheduled castes is not applicable to Arunachal Pradesh. This is because the state is inhabited fully by indigenous tribal people, and there are no scheduled castes. This provision was added later by the 83rd Constitutional Amendment Act of 2000.

5. Duration of Panchayats(243E):

• The constitution has specified the exact duration of operation of a panchayat in Article 243E. It states that every panchayat shall continue to be in force for 5 years unless it is dissolved earlier by any law.
• It also says that election to a panchayat should be completed before its expiry or 6 months before its dissolution.

6. Disqualifications for Membership(243F):

A person shall be disqualified for being chosen as or for being a member of panchayat if he is so disqualified under the following provisions:

1. Any law for the time being in force for elections to the state legislature concerned.
2. Any law made by the state legislature.

However, there is one exception. The minimum age for being a member of State Legislature 25; But the member of the village Panchayat is eligible above the age of 21. 

7. Powers, Authority and Responsibility of Panchayats:

• Panchayats have the power to prepare plans and schemes for economic development and promote social justice in the village.
• As per Article 243G, the state determines the specific scope and extent of the powers of the panchayat in the above matters.

8. State Election Commission:

• The superintendence, direction and control of the preparation of electoral rolls and the conduct of all elections to the panchayats shall be vested in the state election commission.
•  It consists of a state election commissioner to be appointed by the governor. The governor shall also determine his conditions of service and tenure of office.
• He shall not be removed from the office except in the manner and on the grounds prescribed for the removal of a judge of the state high court.
• The state legislature may make provisions concerning all matters relating to elections to the panchayats.

8.1. Powers and Functions(243G)

• The state legislature may endow the Panchayats with the powers and authority necessary to enable them to function as institutions of self-government.
• Such a scheme may contain provisions for the devolution of powers and responsibilities upon Panchayats at the appropriate level concerning;
• The preparation of plans for economic development and social justice,
• The implementation of schemes for economic development and social justice as may be entrusted to them (including 29 subjects listed in the 11^th Schedule).

9. Finances (243H) :

The finances of the Panchayats are dependent upon the states. The state legislature may empower the Panchayats in following ways:

1. Authorise a panchayati raj institution to levy, collect and appropriate taxes, duties, fees and tolls;
2. Assign to a panchayats various taxes, duties, fees and tolls levied and collected by the state government;
3. Provide for giving grants-in-aid to the panchayats from the consolidated fund of the state;
4. Provide for the constitution of funds for crediting all money of the panchayats.

The Second Administrative Reforms Commission of India (2005– 2009) has summarised the sources of revenue of the Panchayati Raj Institutions and their financial issues.

9.1. Finance Commission(243I)

• After every five years, the governor of a state shall comprise a finance commission to review the financial position of the panchayats.
• The Central Finance Commission shall also suggest measures to augment the consolidated fund of a state to supplement the resources of the panchayats in the states.

9.2. Audit of Accounts of Panchayats(243J)

• As per the Constitution of India, State governments have the power to determine who will audit the accounts of panchayats and what procedure will be followed in their states.

Application to Union Territories :

The constitution states that the provisions related to panchayats shall apply to Union Territories in the same way as in the case of the states, but the President may, by public notification, make any modifications to this provision.

Part IX does not apply to certain areas:

Certain areas in India stand as exceptions to Part IX of the Constitution. This means that the state cannot establish panchayats in those areas.

The areas that are provided as exceptions by Article 243M are mentioned below:

• The act does not apply to Nagaland, Meghalaya, Mizoram and certain other areas. These areas include the scheduled and the tribal areas in the states;
• The hilly areas of Manipur for which district councils are present;
• Darjeeling district of West Bengal, for which Darjeeling Gorkha Hill Council is located.

However, the legislature can extend Part IX to some of the above exceptions. According to the constitution, the Parliament may extend the provisions of Part IX to the above-mentioned Scheduled Areas. Also, the Legislatures of Nagaland, Mizoram and Meghalaya may extend Part IX to their states (except the Scheduled and tribal areas). 

Bar to interference by courts(243O)

It further states that no election to any panchayat is to be questioned except by an election petition presented to such authority and in the manner provided by the state legislature.

11th Schedule – containing 29 items placed under the purview of panchayats:

1. Agriculture, including agricultural extension; 2. Land improvement, implementation of land reforms, land consolidation and soil conservation; 3. Minor irrigation, water management and watershed development; 4. Animal husbandry, dairying and poultry; 5. Fisheries; 6. Social forestry and farm forestry; 7. Minor forest produce; 8. Small-scale industries, including food processing industries; 9. Khadi, village and cottage industries; 10. Rural housing; 11. Drinking water; 12. Fuel and fodder; 13. Roads, culverts, bridges, ferries, waterways and other means of communication; 14. Rural electrification, including distribution of electricity; 15. Non-conventional energy sources; 16. Poverty alleviation programme; 17. Education, including primary and secondary schools; 18. Technical training and vocational education; 19. Adult and non-formal education; 20. Libraries; 21. Cultural activities; 22. Markets and fairs; 23. Health and sanitation, including hospitals, primary health centres and dispensaries; 24. Family Welfare; 25. Women and child development; 26. Social welfare, including the welfare of the handicapped and mentally retarded; 27. The welfare of the weaker sections, and in particular, of the scheduled castes and the scheduled tribes; 28. Public distribution system; 29. Maintenance of community assets.

Compulsory and voluntary provisions:

Compulsory Provisions

Voluntary Provisions

1. Organisation of Gram Sabha. 2. Establishment of panchayats at all 3 levels. 3. Direct elections to all seats in panchayats at all levels. 4. Indirect elections to the post of chairperson of panchayats at the intermediate and district levels. 5. Voting rights of the chairperson and other panchayat members elected directly or indirectly. 6. 21 years to be the minimum age for contesting elections to panchayats. 7. Reservation of seats (both members and chairpersons) for S.C.s and S.T.s in panchayats at all the 3 levels. 8. Reservation of one-third of seats (both members and chairpersons) for women in panchayats at all three levels. 9. Fixing tenure of five years for panchayats at all levels and holding fresh elections within 6 months in the event of supersession of any panchayat. 10. Establishment of a State Election Commission for conducting elections to the panchayats. 11. Constitution of a State Finance Commission after every five years to review the financial position of the panchayats.

1. Endowing the Gram Sabha with powers and functions at the village level. 2. Determining the manner of election of the chairperson of the village panchayat. 3. Giving representation to the chairpersons of the village panchayats in the intermediate panchayats or, in the case of a state not having intermediate panchayats, in the district panchayats. 4. Giving representation to the chairpersons of the intermediate panchayats in the district panchayats. 5. Giving representation to members of the Parliament (both the Houses) and the state legislature (both the Houses) in the panchayats at different levels falling within their constituencies. 6. Providing reservation of seats (both members and chairpersons) for backward classes in panchayats at any level. 7. Granting powers and authority to the panchayats to enable them to function as institutions of self-government (in brief, making them autonomous bodies). 8. Devolution of powers and responsibilities upon panchayats to prepare plans for economic development and social justice and to perform some or all of the 29 functions listed in the Eleventh Schedule of the Constitution. 9. Granting financial powers to the panchayats, authorising them to levy, collect and appropriate taxes, duties, tolls and fees. 10. Assigning to a panchayat the taxes, duties, tolls and fees levied and collected by the state government. 11. Making the grants-in-aid to the panchayats from the state’s consolidated fund. 12. Providing for the constitution of funds for crediting all money of the panchayats.

PESA Act of 1996 (Extension Act)

The Provisions of the Panchayats (Extension to Scheduled Areas) Act, 1996 was the law that relaxed the exclusion of Scheduled Areas from the 73rd Amendment. The self-governance system was introduced in ten of fifteen states with Scheduled Areas. 

Objectives of the Act

Features of PESA:

1. Powers exclusive to Gram Sabha:

• Every village shall have its own Gram Sabha.
• A village shall consist of one or more habitations or hamlets comprising a community and managing its affairs in accordance with traditions and customs.

2. Gram Sabha is “competent” to safeguard and preserve the;

• Traditions and customs of the people and their cultural identity,
  • Community resources,
  • The customary mode of dispute resolution.

3. Gram Sabha has mandatory executive functions to;

• Approve plans, programmes and projects for social and economic development.
  • Identify persons as beneficiaries under poverty alleviation and other programmes.
  • Issue a certificate of utilising funds by the panchayat for the plans, programmes and projects referred to in section 4(e) of the PESA Act.

4. Powers exclusive to Gram Sabha/Panchayat at an appropriate level

• Right to mandatory consultation in land acquisition, resettlement and rehabilitation of displaced persons.
  • At an appropriate level, the panchayat is entrusted with planning and managing minor water bodies.
  • Mandatory recommendations by Gram Sabha or Panchayat at the appropriate level prior to the grant of prospecting licenses, mining leases, and concessions for minor minerals.

5. Powers endowed to Gram Sabha and Panchayat at an appropriate level to

• Regulate the sale/consumption of intoxicants. 
  • Ownership of minor forest produce. 
  • Prevent land alienation and restore alienated land. 
  • Manage village markets.
  • Control over money lending to S.T.s.
  • Control over the institutions and functionaries in the social sector, local plans, including Tribal sub-plans and resources.

Reasons for ineffective performance:

Even after imparting constitutional status and protection through the 73^rd Amendment Act of 1992, the Panchayati Raj Institutions (PRIs) activities have not been satisfactory and not up to the expected level. The various reasons for this sub-optimal performance are as follows:

 1. Conceptual Confusion:

• It is said that there is a lack of clarity regarding the concept of Panchayati Raj and the objectives for which the institutions have been established.
• In the first instance, the concept of Panchayati Raj is very narrow as it was not viewed as an institutional framework that could play an important role in the overall development of rural masses.
• The present concept does not envisage a single unit of PRIs as an instrument of planning and implementation agency of different rural development programmes.
• Many agencies in the rural scene are engaged in developmental activities, but there is no clarity about the role that PRIs should play. PRls are still dominated by the people belonging to higher castes. That is why the benefits do not reach the needy ones.

2. Structures:

• While establishing PRIs, no uniform pattern is adopted for creating units and identifying the planning and development unit. This may not be a cause for failure, but structures that various state governments have adopted are incapable of performing the expected role. The distribution of functions and power
• Among the PRIs
• Between PRIs and state government and
• Neither PRIs nor Central government have been made based on sound principles.
• The function has a great deal of confusion, overlapping and sometimes duplication.
• The expertise available to the PRIs is very limited, particularly in planning, implementing, or monitoring various developmental schemes.
•  Planning at the grassroots level remains on paper while there is a strong tendency towards centralisation in the country.

3. Lack of Political Support :

• The elite and the so-called higher strata of society generally do not provide political support to strengthen the democratic process at the grassroots level.
• The members of parliament and state legislatures live in constant fear of Panchayati Raj domination; they are apprehensive about the emergence of Panchayati Raj leadership.
• Therefore, every effort is made by the state and central leadership to weaken the powers and functions of the grassroots leaders.

4. Lack of Adequate Devolution:

• Many States have not taken enough steps to devolve 3Fs (i.e., functions, functionaries and funds) to the PRIs to enable them to discharge their function.
• Further, the PRIs must have resources to match the responsibilities entrusted to them.

5. Red Tapism:

• In some States, the Gram Panchayats have been entrusted with a position of subordination. Hence, the Gram Panchayat Sarpanches must spend extraordinary time visiting Block Offices for funds or technical assistance. These distort the role of Sarpanches as elected representatives.

6. Financial Resources

• The most important problem faced by the PRIs is regarding finances. The quality and variety of activities the PRIs are expected to perform will depend mostly on the resources at their command.
• The resource base depends on the local economy and partly upon the allocations made by the state and central governments. As things stand today, the local economy is very weak.
•  It means the PRIs have a very limited scope to improve their jurisdiction. In India, revenue resources are centralised, which is a bone of contention between the centre and states. There is thus a real danger of imbalance between resources and responsibilities.
• The centre or the states are not coming forward with the same vigour for transferring resources proportionately. Thus, most of these bodies have to function in an atmosphere lacking resources. The states have an agency through which they get their statutory share in revenues, which they get as a matter of right.
• The PRls, the other hand, do not get any share from the state shares; whatever amounts they receive from the state are largely discretionary.
• A recent review of money received and own source funds shows the overwhelming dependence of Panchayats on government funding. When Panchayats do not raise their resources and instead receive funds from outside, people are less likely to request a social audit.

7. Reluctance to use fiscal powers:

• An important power devolved to Gram Panchayat is the right to levy tax on property, markets, businesses, fairs, and services provided, like street lighting, public toilets, etc.
• Very few local bodies use their fiscal power to levy and collect taxes.
• The argument given by the sarpanch is that it is very tough to levy tax on own constituency, as, in a village, people live in a community.

8. Status of the Gram Sabha:

• Empowering the Gram Sabhas could be a potential instrument for accountability, transparency and involvement of the marginalised sections.
• However, the State Acts have not clearly stated the powers of Gram Sabhas, nor have any procedures been laid down for the functioning of these bodies or penalties for the officials for disruption in duties.

9. Creation of Parallel Bodies:

• Often, Parallel Bodies are created for supposedly speedy implementation and greater accountability.
•  However, little evidence shows that such bodies have avoided the evils, including partisan politics, sharing of spoils, corruption and elite capture.
• Missions often bypass the main agenda, creating duality, disconnect, and alienation between the existing and the new structures and functions.

10. Poor Infrastructure:

• Many Gram Panchayats in the country do not have a full-time Secretary. Around 25 %of the Gram Panchayats do not have basic office buildings. The database for planning, monitoring, etc., is often lacking.
• Many elected representatives of PRIs are semiliterate or illiterate and know little about their roles & responsibilities, programmes, procedures, and systems. Often, for want of good, relevant and periodic training, they cannot perform their functions properly.
• Although all the District and Intermediate Panchayats are connected to computers, only around 20% of Gram Panchayats are reported to have computing facilities. In some States, Village Panchayats do not have any computing facilities.

11. Absence of Statutory Provision:

• The success or failure of any institution depends on the status, on the basics of which an organisation is established. Article 40 of the Constitution states, “The state shall take steps to organise village panchayats ….”. It is not mandatory since it is included in the Directive Principles of State Policy. It means the states may or may not constitute the PRIs.
• Similarly, in several states, elections have not been held regularly. The superseded bodies have not been revived, and they were kept under the charge of special officers drawn from the civil service. Thus, the PRIs have been undermined by several constraints, particularly the constitutional constraints.

Way forward:

It would be wrong to conclude that the PRIs have failed completely and have no future. It is a well-established fact that there is no substitute for democratic decentralisation. But a lot needs to be done to tackle the issues mentioned above. Our policy relating to PRIs should focus on identifying and rectifying these problems. Some efforts are being made, and more need to be made to correct the lapses. We will now discuss the measures that would be or have been adopted to strengthen the PRIs.

1. Conceptual Clarity :

• The first important aspect that needs immediate attention is the evolving comprehensive concept of Panchayati Raj. Its goals and functions have to be clearly defined.
• Firstly, the PRIs should be treated as the basic units of self-government. There is a need for decentralisation of administrative and political power. This would encourage self-governance and mass participation in its work.
• Secondly, the PRIs have to contribute towards strengthening the planning process at the micro level and overall development. Finally, the members of the weaker sections should be given a chance to reach the highest level of decision-making bodies. So, a Bottom-up approach is the need of the hour.

2. Awareness among Panchayati Raj Functionaries:

• It is generally realised that the Panchayati Raj functionaries do not have sufficient knowledge about their new role. They are ignorant of several aspects of the Panchayati Raj system.
• Therefore, it is necessary to provide an opportunity for them to learn about the Panchayati Raj Acts, the objectives and role of PRIs, the rural situation, possible areas of growth and minimum spills of planning for the overall development of their respective areas.
• It is necessary to train them so that they can perform their functions effectively. This would also help them to minimise the citizens’ apathy towards the PRI activities.

3. Financial Support :

• There is a need for a sound financial base for PRIs. The establishment of a Panchayati Raj Finance Corporation could be the first step.
• Enlarged tax jurisdiction sharing of revenues from selected state taxes and grants are the other possible alternatives to achieve the long-term objective.
• As per the I985 Act, the state government in Karnataka has to organise a state finance commission to work out the distribution of finances between the state and the PRIs. This step would go a long way in solving the financial problems of the PRIs.
• Along with this, the PRIs should also keep tapping their own resource base.

4. Integrated Administrative Structures:

• There is a need for remodelling the administrative organisation of PRIs. It is necessary that all the officials whose functions have been shifted to PRIs have to be placed under the respective institutions. It calls for a separate service called Panchayati Raj Service.
• Appropriate measures should be taken to protect civil servants from undesirable political pulls and pressures. An integrated administrative structure, thus, becomes essential.

5. Recommendations by 2nd ARC commission:

The 6th report of the 2nd ARC, “Local Governance -An Inspiring Journey to into the Future”, gives us the following recommendations:

Some other recommendations are:

1. A local body Ombudsman should be constituted.
2. Clear segregation of functions for each level of local government.
3. Rural and urban development should be interlinked.
4. Separate standing committee of the state legislature should be established for the local bodies.

Conclusion:

It has to be kept in mind that all these efforts will remain on paper if adequate steps to implement them are not made. A review of the experience of decentralisation in developing countries made by the World Bank can be our guiding principles in order to boost the institution of Panchayati Raj.

FAQs related to Panchayati Raj  in India