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Cooperative Federalism in The Lines of Article 256 And 265 of the
Constitution on India
Abstract This article provides an overview of cooperative federalism in India, focusing on constitutional provisions, recent case laws, and taxation principles. It highlights the role of cooperative federalism in fostering inclusive development and equitable governance, with recent case laws illustrating the dynamic nature of federal-state interactions. Introduction The term federalism is derived from the Latin word "foedus," which meaning treaty or agreement. As a result, a federation is a new state strategy that combines the principles of centralization with the authority of decentralized entities. India is made up of several states with distinct cultures, therefore federalism adaptability is critical. In India, the concept of cooperative federalism strengthens both the center-state relationship and the cooperation between states and local administrations. Federalism is a form of governance in which powers are distributed between the center and its constituent portions, such as states or provinces. In India, cooperative federalism shows a concept of a stable partnership between the central government and other entities. It encourages all governing entities to step up and collaborate to address common social, political, economic, and civic issues. Constitutional Framework The authority of the State and the Union has been divided in Article 246 of the Constitution, it divides the Union and State's powers into three lists. They are: the Union List, the State List, and the Concurrent List. Union list: The Union List is a list of 100 issues over which the Union or Centre government has supreme authority. It consists of issues of national importance, such as defense, foreign affairs, finance, atomic energy, railways, and postal services. State list: The state list consists of 61 issues over which state legislatures have authority. It covers topics like as public order, prisons, public health, the production, manufacturing, transportation,
buying, and sale of intoxicating liquors, agricultural education and research, fisheries, and state public services, among others. Concurrent list: The concurrent list consists of 47 issues over which both the Union and State governments have competence. It covers topics such as criminal law, criminal process, preventative detention, forests, wild animal and bird protection, trade unions, industrial and labour conflicts, and so on. The idea that tasks of national importance should be delegated to the Centre and those of local interest to the state is a key criterion used to decide which subjects should be assigned to which level of government. This test does not produce a consistent pattern of power and function distribution between the two levels of government in all federal nations because it is rather broad and serves as an ad hoc formula. This discrepancy stems from the failure to categorize what is of broad or national relevance from what is of local importance. Defense, foreign policy, and financial matters are all deemed to be of national importance and hence assigned to the Centre. What other disciplines should be included in the Centre, however, is determined by the needs of the country, people's attitudes, and the philosophy popular at the time the Constitution was drafted, as well as the function the Centre is projected to play in the future. Predominance of Union Law and Limitations of State Legislatures: Predominance of Union Law and Limitations of State Legislatures When three lists overlap on a specific issue, the Union Law takes priority. In the concurrent arena, Union Law takes priority over State Law in situations of disagreement or conflict on the same matter. The Union List comprises a number of problems that would normally come under the purview of the states, such as industry, elections and audits, interstate commerce, and so on. The Union is granted the authority to legislate on any subject not covered in any of the three categories. One example is taxes. In some situations, the Union Legislature's jurisdiction is expanded. Parliament may make legislation dealing with State List concerns in the following situations: When a two-thirds majority vote of the Rajya Sabha, or Council of States, determines that it is required in the national interest. When a state of emergency is declared. When the constitutional machinery of the state fails. To execute international accords and conventions, governments must agree and have their legislatures approve them. Certain types of legislation cannot be submitted in state legislatures without the President's
together, it would be evident that the State has the exclusive jurisdiction over dams, embankments, and other forms of water storage units, as well as any works, land, and buildings it possesses or controls, including the rights to the property. Parliament cannot expand Entry 56 to include just dams and embankments under state control. The petitioner also claims that the bulk of dams in Tamil Nadu are not even built on interstate rivers. The petitioner claims that when combined with Article 246(3) of the Constitution, the Act's provisions are faulty due to legislative ineptitude. The petitioner contends that the Union usurps the State's authority under the cover of "Dam Safety," using the concepts of "Pith and Substance" and "Lifting the Veil." The Central Government has filed a counter-affidavit in the Madras High Court, saying that the 2021 law does not alter the states' current ownership and water rights. The law's only objective is to set up a system for proper dam monitoring, inspection, operation, and maintenance. As a consequence, the Counter determined that the Dam Safety Act does not contravene Articles 246(3), 14, 19, or 21 of the Indian Constitution, and that the DMK MP's claims are baseless. Issue involved in the case was, Whether the parliament has the authority to enact laws where the state has sole authority to do so? Judgement of the Court: The matter is still pending before the court. Taxation and Legislative Authority Article 246 Subject Matter of the Union and States to enact legislation on taxation. According to Article 265 of the Indian Constitution, the union and state governments cannot charge or collect taxes unless authorized by legislation. This simply indicates that the jurisdiction of the central or state government to charge and collect taxes is not unlimited; rather, Article 265 of the Indian Constitution sets some general and particular constraints on it. These limitations are easily recognized after establishing the scope of the phrases used in this section. i) Law: In this section, the term "law" refers to statute law, which is a legislative act. It simply implies that there must be a clear legislative provision for imposing a tax. As a result, it is critical to understand that a tax cannot be imposed solely on presidential orders. As it does not fit the definition of this phrase. Furthermore, it might be said that simply passing a resolution by the house will be insufficient in this scenario. So, in order to collect any tax under the law, the legislature must pass a legislation. ii) Levy and collection: The terms 'levy' and 'collection' used in this Article refer not only to the imposition of a tax, but also to the collection of the tax, which must be sanctioned
by law. As a result, it essentially means that every stage of the process must meet the criterion. Furthermore, a taxation act must not violate Article 13 of the Indian Constitution, which states that it shall not impinge on basic rights guaranteed by the constitution. It should not violate the equal protection provision of Article 14, the reasonable limits clause of Article 19, or the freedom of trade and commerce provided by Article 301 of the Indian Constitution. In the case of Pratibha R.C.C. Spun, pipe and cement products V/s State of Karnataka , the imposition of a certain tax was rejected in light of Article 265 of the Indian Constitution. In this situation, a tax was levied in the form of a fee. The tax was considered unconstitutional since there was no parliamentary legislation to support it. To summarize, simply issuing an executive order is insufficient for levying and collecting a tax; parliamentary authorization is required. Furthermore, in addition to imposing the tax, the government must also authorize its collection by a statute or act. Financial Allocation Mechanisms Articles 268 to 281 of the Indian Constitution contain detailed regulations that instruct the center in the allocation of financial resources among the states. It establishes guidelines for the central government and states to coordinate tax levying and collecting through systematic procedures. For the time being, the provisions are listed here, but will be described in greater depth later. This includes: Taxes imposed by the Union but collected and retained by the states (Article 268). Taxes raised and collected by the Union but allocated to the states (Article 269). Taxes imposed and dispersed between the Union and the States (Article 270). Grant-in-aid from the center to the states (Article 273, Article 275 and Article 282). Distribution of profits from other taxes. The Finance Commission, as specified in Article 280, is critical in making recommendations on the allocation of finances between the central and the states. The 101st Amendment to the Constitution and the implementation of GST in the Indian economy have drastically altered the landscape of financial ties between the Centre and the States. As a result, it is critical to understand what GST is, how it works, and the various forms it takes. Position before GST Prior to the establishment of GST, the center and states levied various taxes, and their distribution was unclear and non-uniform. It includes taxes like as service tax, central excise, customs duty, and state VAT. However, with the
