Section 168(1) in The Bihar Panchayat Raj Act, 2006
(1)The Government shall as soon as may be from the commencement of this Act and thereafter on the expiration of every fifth year constitute a Finance Commission to review the financial position of the Zila Parishads, Panchayat Samitis and Gram Panchayats and to make recommendations to the Government with regard to-(a)the principles which should govern(i)the distribution between the State and the Zila Parishads, Panchayat Samitis and Gram Panchayats of the net proceeds of the taxes, duties and fees livable by the Government which may be divided between them and allocation between the Zila Parishads, Panchayat Samitis and Gram Panchayats of their respective shares of such proceeds;(ii)the determination of the taxes, duties and fees which may be assigned to or appropriated by the Zila Parishads, Panchayat Samitis and Gram Panchayats-,(iii)the grants-in-aid to Zila Parishads, Panchayat Samitis and Gram Panchayats from the Consolidated Fund of the State;(b)the measures needed to improve the financial position of the Zila Parishad, Panchayat Samitis and Gram Panchayats;(c)any other matter referred to the Finance Commission by the Governor in the interest of sound finance of the Zila Parishads, Panchayat Samitis and Gram Panchayat.
