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Subject to the provisions of the Constitution, the Legislature of State, may by law, endow the Panchayats with such powers and authority as may be necessary to enable them to function as institutions of Self Government and such law may contain provisions for the devolution of powers and responsibilities upon Panchayats at the appropriate level, subject to such conditions as may be specified therein with respect to - 
(a)    the preparation of plans for economic development and social justice;
 

(b)    the implementation of schemes for economic development and social justice as may be entrusted to them including those in relation to the matters listed in the Eleventh Schedule."

6.8 Reliance is placed on the decisions of the Apex Court in the cases of Bashiruddin Ashraf v. Bihar Subai Sunni Majlis Awaqf and Anr., AIR 1965 SC 1206, Subramaniam Shanmugham v. M. L. Rajendran and Ors., AIR 1987 SC 2166, Tarlochan Dev Sharma v. State of Punjab and Ors., AIR 2001 SC 2524 and A. Sanjeevi Naidu v. State of Madras and Anr., 1970 (1) SCC 443 in support of the aforesaid submissions.

Discussion :

7. Article 243G of the Constitution and Scheme of the Panchayats Act, 1993 :

7.1 Before dealing with the submissions, it is necessary to appreciate the scheme of the Gujarat Panchayats Act, 1993, because even Article 243G of the Constitution conferring constitutional status on the Panchayats as institutions of self Government leaves the extent of devolution of powers to the State Legislature. The said Article provides that the State Legislature may, by law, endow the Panchayats with such powers and authority as may be necessary to enable them to function as institutions of self-government and such law may contain provisions for the devolution of powers and responsibilities upon Panchayats at the appropriate level, subject to such conditions as may be specified therein.
(7) Any modifications so made by the State Legislature shall be published in the Official Gazette and shall thereupon take effect."

8. Is President of District Panchayat like Chief Minister of State? What are Principles underlying Panchayats Act?

8.1 Before taking up the written submissions made by Mr. Tushar Mehta for the petitioners, it is first necessary to state at the outset the underlying theme of Mr. Mehta's submission which was voiced by him orally at the hearing, but not incorporated in the written submissions, that just as India is a union of States and just as the Chief Minister is the head of the Government in a State so also the State comprises of District Panchayats and the President of the District Panchayat is the head of the District Panchayat, and therefore, the President of the District Panchayat is to be regarded as having the same powers in the administration of District Panchayat which the Chief Minister has in the matters of State administration. Mr. Mehta contended that if this argument is not accepted, it would amount to negation of democracy at the gross-root level or denigrading the institution of the local self government, which the State Legislature could not have intended contrary to. the fetter and spirit of the 72nd Amendment to the Constitution, 8.2 While the status of the President of the District Panchayat as the head of the District Panchayat cannot be disputed, the difficulty is in accepting the argumentative analogy that he is like the Chief Minister as the head of the Government in a State. A perusal of the above quoted provisions of the Constitution and of the Panchayats Act in Para 7 above makes it clear that the Constitution has provided for democracy at the grass-root level without giving a District Panchayat the status or powers of a Province in a Federation. The executive powers of the Union Government and the State Government are referable to Articles 73 and 162 respectively read with Articles 245 and 246 and Schedule VII to the Constitution. But the Constitution does not contain any such separate provision for Panchayats nor is there a provision of a separate "Panchayats List", unlike "State List" in Schedule VII to the Constitution. Article 243G of the Constitution has left it to the State Legislature to determine the extent of devolution of powers upon Panchayats at the appropriate level, subject to such conditions as may be specified in the State enactment.

16. Summary of Conclusions : (i) Basic Scheme (Para 8)

(a) The Constitution has not conferred upon District Panchayats or any other institution of Local Self Government any status or role conferred upon States as Provinces in a Federation. While constitutional status is conferred on Panchayats as institutions of self-Government, the Constitution has left it to the State Legislature to determine the extent of devolution of powers to such institutions at the appropriate level, subject to such conditions as may be specified in the State enactment. (Paras 8.2 and 8.4)