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(a) The State Legislature has the discretionary power to decide the quantum of powers to be devolved to Panchayats with reference to the 29 subjects enumerated in Schedule-XL According to the information available with the Central Government (Ministry of Rural Development), the State Government has devolved functions to Panchayats in respect of 17 out of 29 subjects and funds have been devolved in respect of 5 subjects.
(b) The State Government has been requested from time to time to devolve more powers to Panchayat Raj Institutions. The Government of India has been taking up the matter regarding devolution of funds, functions and functionaries from time to time with all the State Governments and UTs, including the State of A.P. to enable them to function as institutions of self-governance. The Government of India in the Ministry of Rural Development has the mandate to implement the various provisions of the Constitution (73rd Amendment) Act, 1992. This Ministry have been requesting the Ministries/Departments of the Central Government as well as State Governments to involve Panchayat Raj Institutions in the implementation of the schemes of the Central and the State Governments, from time to time.
(c) Amongst the main features of the Constitution (73rd Amendment) Act, 1992 is included the devolution of powers and responsibilities upon Panchayats in respect of the 29 subjects listed in Schedule-XI to enable them to function as institutions of self-governance.
(d) The provisions of Article 243G of the Constitution require the State Government to devolve funds, functions and functionaries to Panchayat Raj Institutions in respect of the 29 subjects enumerated in Schedule-XI.
(e) State Governments including the Government of A.P. have been advised to minimize the control of the Government over the Panchayats.
(f) All the centrally sponsored schemes are not being implemented through the Panchayat Raj Institutions.
(g) The State Legislature has the discretion to enact laws authorizing Panchayats to levy, collect and appropriate such taxes, duties, tolls and fees, subject to such procedure and limitations as the Legislature may deem fit.
(h) The 29 subjects enumerated in Schedule-XI need to be desegregated into activities/tasks which are to be devolved to the appropriate tier of Panchayats with adequate financial powers, funds and staff. The Central Government (Ministry of Rural Development) will continue to pursue the matter with the State Governments including State of A.P. for further devolution of funds, functions and functionaries.
(b) The provisions of Part-IX of the Constitution are mandatory.
(c) The very purpose of the Constitutional amendment is to provide local self-Government. The 1994 Act however effectuates no devolution or transfer of powers in respect of various items and subjects mentioned in Schedule-XI, to the Panchayat Institutions in a manner that effectuates the expressed Constitutional purpose viz., that these bodies function as institutions of local self-Government.
(d) Power over funds, over functions, over functionaries and over policy processes is an essential attribute of local self-Government. Such devolution and responsibility has been denied by the provisions of the 1994 Act.