RAS question
Which Article of the Indian Constitution provides for the establishment of a Finance Commission?
Correct answer: (A) Article 280.
Article 280 of the Indian Constitution provides for the President to constitute a Finance Commission every fifth year, or earlier if necessary.
Explanation
Article 280 is the constitutional basis for the Finance Commission. It says the President shall constitute a Finance Commission after every fifth year, or earlier if the President considers it necessary, with a Chairman and four other members appointed by the President. Its work is tied to fiscal federalism: it recommends how the net proceeds of taxes should be distributed between the Union and the States, how State shares should be allocated, the principles governing grants-in-aid from the Consolidated Fund of India, and measures to augment the Consolidated Fund of a State for local bodies. That is why Article 280, not the adjacent finance provisions, directly answers the question.
Why the other options are wrong
- (B) Article 275 concerns grants from the Union to certain States, so it deals with a specific grant mechanism rather than the establishment of the Finance Commission.
- (C) Article 300A protects the right to property by saying that no person can be deprived of property except by authority of law, so it is outside the Finance Commission framework.
- (D) Article 270 deals with taxes levied and distributed between the Union and the States, while Article 280 creates the Finance Commission that makes recommendations on such distribution.
Concept
This tests the constitutional machinery of Centre-State financial relations under fiscal federalism. It recurs in RAS because Finance Commission provisions connect taxation, grants-in-aid and the Union-State balance in governance.