Panchayati Raj &

Urban Local Government

Complete Study Notes

Unit I & Unit II — All Topics Covered

 Table of Contents
UNIT I — Introduction of Panchayat Raj in India

1.1 Meaning and Importance of Local Self Government

1.2 Evolution of Panchayat Raj in India

1.3 Salient Features of 73rd Constitutional Amendment Act, 1992

1.4 PESA Act, 1996

UNIT II — Evolution of Urban Local Governments in India

2.1 Meaning and Significance of Urban Local Self Government

2.2 Evolution of Urban Local Self Government in India

2.3 Salient Features of 74th Constitutional Amendment Act, 1992

 UNIT I — Introduction of Panchayat Raj in India

Topic 1.1 — Meaning and Importance of Local Self Government

1. Meaning of Local Self Government

Local Self Government (LSG) refers to the system of governance at the grassroots level where locally
elected bodies manage and administer the affairs of a specific locality — a village, town, or city. It is the
lowest tier of government, closest to the people.

Key Definitions
• Lord Ripon (1882): 'Local Self Government is not primarily a question of efficiency; it is a question of
political education.'
• Laski: 'Local government is the exercise of governmental power by bodies subordinate to the central
authority.'
• Finer: 'Local governments are public organizations authorized to govern a limited area within the
state.'

Types of Local Self Government in India

Type Rural Bodies Urban Bodies

Village level Gram Panchayat Nagar Panchayat

Intermediate Panchayat Samiti Municipal Council

District/City Zila Parishad Municipal Corporation

2. Importance of Local Self Government

A. Political Importance
• Trains citizens in democratic participation — 'school of democracy'
• Promotes political consciousness at grassroots level
• Ensures decentralisation of power — prevents concentration at the centre
• Creates a nursery for future political leaders

B. Administrative Importance
• Better local knowledge — local bodies understand local needs better than distant central authorities
• Faster decision-making — reduces red tape and bureaucratic delays
• Promotes accountability and transparency — elected representatives directly answerable to
people
• Eases the burden on central and state governments
C. Economic Importance
• Mobilises local resources for development
• Promotes local economic activities — markets, fairs, rural industries
• Ensures better utilisation of funds through local planning
• Implements poverty alleviation programmes at ground level

D. Social Importance
• Promotes social justice through reservation for SC/ST and women
• Addresses local social issues — health, sanitation, education
• Builds community cohesion and a sense of belonging
• Empowers marginalised sections of society

Mahatma Gandhi envisioned 'Gram Swaraj' — a self-sufficient village republic as the basic unit of Indian
democracy. Local Self Government is the institutional realisation of this vision.

3. Principles of Local Self Government

• Subsidiarity: Decisions should be taken at the lowest possible level of governance
• Participation: Active involvement of citizens in governance
• Accountability: Representatives answerable to the electorate
• Transparency: Open functioning and public access to information
• Equity: Representation for weaker sections through reservations
Topic 1.2 — Evolution of Panchayat Raj in India

1. Ancient & Medieval Period

The concept of village self-governance has deep historical roots in India. Ancient texts like Rig Veda
mention 'Sabha' and 'Samiti' as democratic assemblies. The 'Panch' (council of five elders) was the basic
unit of village administration.
• Village assemblies called Ur, Nadu, and Sabha existed in South India during Chola period (9th-10th
century)
• Medieval period saw decline of village governance under Mughal centralisation

2. British Period
Year / Act Development

1687 First Municipal Corporation established in Madras

Lord Ripon's Resolution, 1882 Called 'Magna Carta of Local Self Government'; introduced elected local bodies; stresse

Royal Commission on Decentralisation, 1907

Recommended
(Hobhousestrengthening
Commission) village panchayats

Government of India Act, 1919 Local self government made a 'transferred subject' under provincial governments

Government of India Act, 1935 Local government placed under provincial autonomy

Lord Ripon's Resolution of 1882 is considered the foundation of modern Local Self Government in India.

3. Post-Independence Period
Constitutional Provisions (1950)
The original Constitution did not make Panchayati Raj a justiciable right. It was placed in Article 40
(Directive Principles of State Policy): 'The State shall take steps to organise village panchayats and endow
them with such powers and authority as may be necessary to enable them to function as units of
self-government.'

Key Committees & Milestones

Committee / Act Year Key Contributions

Balwant Rai Mehta Committee 1957 Recommended democratic decentralisation; three-tier Panchayati Raj; first impl

Santhanam Committee 1963 Focused on Panchayat finances and resources

Ashok Mehta Committee 1978 Recommended two-tier structure; Zila Parishad as key unit; political parties' par

G.V.K. Rao Committee 1985 Recommended Panchayats be 'living bodies'; called district as basic unit of plan

L.M. Singhvi Committee 1986 Recommended constitutional status; Gram Sabha as foundation; coined 'Gram
Committee / Act Year Key Contributions

P.K. Thungon Committee 1988 Recommended constitutional amendment for three-tier Panchayati Raj

64th Amendment Bill 1989 Introduced by Rajiv Gandhi; passed Lok Sabha but rejected in Rajya Sabha

73rd Amendment Act 1992 Constitutional status given; came into force 24 April 1993

Phases of Panchayati Raj in India

• Phase I (1959–1964): Enthusiastic start; Rajasthan and Andhra Pradesh were pioneers
• Phase II (1964–1977): Period of stagnation; Panchayats neglected; supersession common
• Phase III (1977–1992): Revival attempts; state-level reforms; Ashok Mehta report
• Phase IV (1992 onwards): Constitutional status; uniform three-tier structure across India
Topic 1.3 — Salient Features of 73rd Constitutional Amendment Act, 1992

Overview
The 73rd Constitutional Amendment Act, 1992 gave constitutional status and protection to Panchayati
Raj institutions. It added Part IX (Articles 243 to 243-O) and the 11th Schedule (29 subjects) to the
Constitution. It came into force on 24 April 1993.

1. Three-Tier Structure (Article 243-B)

Level Name Area Covered

Village Gram Panchayat One or more villages

Intermediate Panchayat Samiti A block / taluka

District Zila Parishad Entire district

States with population below 20 lakh may omit the intermediate tier.

2. Gram Sabha (Article 243-A)

• Assembly of ALL registered voters in a village — the foundation of democracy
• Approves development plans, questions representatives, monitors expenditure
• Ensures direct democracy at the grassroots

3. Reservation of Seats (Article 243-D)

• SC/ST: Proportional reservation at all tiers including Chairpersons
• Women: Minimum one-third seats AND Chairperson offices reserved
• Rotation: Reserved seats rotated among constituencies
• OBC: Left to state discretion — not mandated

4. Duration — 5 Years (Article 243-E)

• Fixed 5-year term; fresh elections within 6 months of dissolution
• Dissolved Panchayat's successor serves only the remaining term

5. State Election Commission (Article 243-K)

• Independent body to conduct Panchayat elections
• Commissioner removable only like a High Court judge
6. State Finance Commission (Article 243-I)
• Constituted every 5 years by the Governor
• Reviews financial position; recommends devolution of taxes and grants

7. Powers & Functions (Article 243-G)

• States MAY devolve 29 subjects listed in the 11th Schedule
• Panchayats to prepare and implement plans for economic development and social justice

8. The 11th Schedule — 29 Subjects

1. Agriculture including agricultural extension 2. Land improvement and land reforms

3. Minor irrigation and water management 4. Animal husbandry, dairying and poultry

5. Fisheries 6. Social forestry and farm forestry

7. Minor forest produce 8. Small scale industries including food processing

9. Khadi, village and cottage industries 10. Rural housing

11. Drinking water 12. Fuel and fodder

13. Roads, culverts, bridges and ferries 14. Rural electrification

15. Non-conventional energy sources 16. Poverty alleviation programmes

17. Education including primary and secondary schools 18. Technical training and vocational education

19. Adult and non-formal education 20. Libraries

21. Cultural activities 22. Markets and fairs

23. Health and sanitation 24. Family welfare

25. Women and child development 26. Social welfare (disabled and mentally retarded)

27. Welfare of weaker sections (SC/ST) 28. Public distribution system

29. Maintenance of community assets

9. Compulsory vs Voluntary Provisions

Compulsory Voluntary (State Discretion)

Three-tier structure Devolution of 29 subjects

SC/ST/Women reservation OBC reservation

5-year fixed term Powers to Gram Sabha

State Election Commission Representation of legislators

Compulsory Voluntary (State Discretion)

State Finance Commission —

Elections within 6 months —

10. Exceptions (Article 243-M)

• Not applicable to Nagaland, Meghalaya, Mizoram (tribal customary law)
• Hill areas of Manipur; Darjeeling (West Bengal)
• Scheduled and Tribal Areas under Articles 244(1) and 244(2)
PESA Act 1996 extended Panchayati Raj provisions to Scheduled Areas with modifications.

11. Significance
• Constitutional sanctity to grassroots democracy
• World's largest experiment in democratic decentralisation
• Over 13 lakh elected women representatives in Panchayats
• Established three-tier federal structure: Union — State — Local

12. Criticisms
• Inadequate devolution of Funds, Functions, Functionaries (3Fs)
• Financial dependence on states; 'may' clause weakens devolution
• 'Sarpanch Pati' syndrome — proxy representation by male relatives
• Parallel bodies (DRDAs) undermine Panchayat authority
Topic 1.4 — PESA Act, 1996

1. Background & Need

The Fifth Schedule of the Constitution covers Scheduled (tribal) Areas in 10 states. The 73rd Amendment
exempted these areas under Article 243-M. To fill this gap and extend self-governance to tribal
communities, Parliament enacted the Provisions of the Panchayats (Extension to Scheduled Areas)
Act, 1996 — popularly known as PESA.

• Enacted on: 24 December 1996

• Applies to: Andhra Pradesh, Telangana, Chhattisgarh, Gujarat, Himachal Pradesh, Jharkhand,
Madhya Pradesh, Maharashtra, Odisha, Rajasthan
• Based on recommendations of the Bhuria Committee (1995)

2. Objectives of PESA
• Extend democratic governance to tribal (Scheduled) areas
• Preserve and protect tribal customs, traditions, and cultural identity
• Empower tribal communities through self-governance
• Ensure tribal control over natural resources — land, forest, water
• Prevent exploitation of tribal people

3. Key Features of PESA

3.1 Recognition of Gram Sabha
• Gram Sabha is the cornerstone of PESA — given supreme status in tribal areas
• Every village must have its own Gram Sabha based on traditional customs
• Gram Sabha shall be competent to safeguard and preserve the traditions, customs, and cultural
identity of the people

3.2 Powers of Gram Sabha under PESA

• Power to approve plans, programmes, and projects for social and economic development
• Mandatory consultation before land acquisition in Scheduled Areas
• Control over minor forest produce
• Power over minor water bodies — planning and management
• Regulation of sale and consumption of intoxicants
• Ownership of minor minerals — prospecting licences require Gram Sabha consultation
• Power to prevent alienation of tribal land and restore unlawfully alienated land
• Control over money lending to Scheduled Tribes
• Control over local markets and fairs
• Management and control of village markets
 3.3 Reservation Provisions
• Chairpersons of Panchayats at ALL levels in Scheduled Areas shall be members of Scheduled
Tribes
• Not less than one-half of total membership of Panchayats reserved for STs
• Seats reserved for STs cannot be less than their population proportion

3.4 Restrictions on State Governments

• States must ensure that Panchayats function in accordance with the customs and traditions of the
people
• States cannot devolve responsibilities to Panchayats that would adversely affect the interests of
tribals
• Prior recommendation of Gram Sabha mandatory for land acquisition
• State legislation must be in consonance with the spirit of PESA

3.5 Control over Resources

Resource PESA Provision

Minor Forest Produce Gram Sabha / Panchayat ownership and control

Minor Minerals Consultation with Gram Sabha before licences

Minor Water Bodies Planning and management by Panchayats

Land Prevention of alienation; mandatory Gram Sabha nod

Markets Gram Sabha control over village markets

Money Lending Regulation of money lenders to STs

Intoxicants Gram Sabha power to regulate/prohibit

4. Significance of PESA
• First legislation in India to recognise tribal self-governance based on customary law
• Places Gram Sabha at the centre — above the Gram Panchayat in tribal areas
• Provides legal protection against tribal land alienation
• Recognises the unique socio-cultural identity of tribal communities
• Empowers tribes to manage their own natural resources

5. Challenges in Implementation
• Many states have enacted conformity legislation that dilutes PESA provisions
• Officials often bypass Gram Sabha consultations for land acquisition and mining
• Displacement of tribals continues despite PESA protections
• Conflict between Forest Rights Act 2006 and PESA jurisdiction
• Low awareness among tribal communities about their PESA rights
 • Lack of capacity building for Gram Sabhas

PESA is often called the 'Constitution of Tribal Areas.' Its effective implementation remains a major challenge in
India.
 UNIT II — Evolution of Urban Local Governments in
India

Topic 2.1 — Meaning and Significance of Urban Local Self Government in India

1. Meaning of Urban Local Self Government

Urban Local Self Government (ULSG) refers to the system of governance of towns and cities by locally
elected bodies. These institutions manage civic amenities, urban infrastructure, and local development in
urban areas. They are the third tier of government for urban India.

• Governed by the 74th Constitutional Amendment Act, 1992

• Covers municipalities, municipal corporations, nagar panchayats, and special purpose bodies
• India's urban population crossed 50 crore (2023) — urban governance is increasingly critical

Types of Urban Local Bodies (ULBs)

Type Area/Population Examples

Nagar Panchayat Transitional area (rural to urban) Small towns, census towns

Municipal Council / Board Smaller urban area Towns with moderate population

Municipal Corporation Large cities (usually 3 lakh+ population) Mumbai, Delhi, Chennai, Kolkata

Cantonment Board Military areas Pune Cantonment, Meerut Cantonment

Township Industrial/project townships Bhilai, Rourkela, NOIDA

Special Purpose Agency Specific urban function DDA, HMDA, BDA

2. Significance of Urban Local Self Government

A. Democratic Significance
• Brings government closest to urban citizens
• Promotes participatory democracy in cities
• Creates platform for civic engagement and community involvement
• Provides training ground for democratic leadership at local level

B. Administrative Significance
• Efficient delivery of civic services — water, sanitation, roads, streetlights
• Local accountability — elected councillors directly answerable to voters
• Better understanding of local urban problems than distant state/central government
• Reduces administrative burden on state government
C. Economic Significance
• Revenue generation through local taxes — property tax, trade licences, user charges
• Promotes urban economic development — markets, industrial areas, SEZs
• Implementation of urban poverty alleviation schemes (SJSRY, PMAY-Urban)
• Manages urban land use and planning — crucial for economic activity

D. Social Significance
• Provision of essential social services — hospitals, schools, parks, libraries
• Welfare of urban poor — slum development, affordable housing
• Reservation for women, SC/ST promotes social equity in urban governance
• Manages urban sanitation and public health — crucial for urban well-being

E. Developmental Significance
• Preparation of City Development Plans and Master Plans
• Regulation of urban land use — zoning laws, building permissions
• Implementation of smart city initiatives and urban renewal projects
• Environmental management — solid waste, drainage, pollution control

India is projected to have 40% urban population by 2030. Strong Urban Local Bodies are essential to manage this
urbanisation sustainably.

3. Functions of Urban Local Bodies

Obligatory / Mandatory Functions
• Supply of pure drinking water
• Construction and maintenance of roads, bridges, culverts
• Street lighting
• Solid waste management (garbage collection and disposal)
• Sanitation and drainage
• Prevention of dangerous diseases — public health
• Registration of births and deaths
• Maintenance of public parks, gardens, and open spaces

Discretionary Functions
• Construction and management of markets
• Establishment of hospitals and dispensaries
• Promotion of education — schools, libraries
• Urban planning and slum improvement
• Promotion of cultural activities
• Provision of public transport
Topic 2.2 — Evolution of Urban Local Self Government in India

1. Ancient Period
Ancient Indian cities had sophisticated systems of urban administration. Arthashastra (Kautilya, 4th
century BCE) mentions 'Nagaraka' (city superintendent) and 'Paura' (town council). The Mauryan Empire
had elaborate municipal administration in Pataliputra.
• Megasthenes (Greek ambassador) described a 30-member Municipal Commission in Pataliputra
divided into 6 committees covering census, industries, foreigners, commerce, public buildings, and
market regulation

2. Medieval Period
• Mughal period: 'Kotwali' system for urban policing and administration
• 'Kotwal' performed municipal functions — law enforcement, market regulation, sanitation
• No formal elected urban local bodies; administration by royal appointees

3. British Period — Key Milestones

Year / Event Significance

1687 — Madras Municipal Corporation First Municipal Corporation in India; oldest urban local body

1726 — Calcutta and Bombay Corporations

Extended municipal governance to Presidency towns

Lord Mayo's Resolution, 1870 Devolved some financial powers to local bodies

Lord Ripon's Resolution, 1882 Magna Carta of Local Self Government; introduced elected non-official majorities; local b

Hobhouse Commission, 1907 Recommended strengthening urban local bodies; audit and finance reforms

Montagu-Chelmsford Reforms, 1919 Local self government made 'transferred subject' under provincial ministers; significant e

Simon Commission, 1930 Reviewed working of local bodies; recommended greater powers

Government of India Act, 1935 Local government under full provincial autonomy; further expansion

Post-Independence (1947–1992) Left to state legislatures; no constitutional mandate; bodies often superseded; weak and

74th Amendment Act, 1992 Constitutional status; 12th Schedule; came into force 1 June 1993

4. Post-Independence Neglect (1947–1992)

After independence, urban local bodies were entirely left to state governments. Several problems plagued
them:
• Frequent supersession of elected bodies by state governments
• Irregular elections — many bodies ran without elections for years
• Inadequate financial resources and staff
 • No constitutional protection or uniform structure
• Parallel bodies like Development Authorities (DDA, BDA) undermined ULBs

5. Committees on Urban Local Bodies

Committee Year Key Recommendations

Rural-Urban Relationship Committee (Baljit

1963 Singh) Coordination between rural and urban bodies

Committee on Augmentation of Financial1963

Resources Financial
of Urban Local
strengthening
Bodies (Zakaria
of ULBsCommittee)

National Commission on Urbanisation (Charles

1988 Correa)
Recommended constitutional status for ULBs; basis for 74th Amendment

P.K. Thungon Committee 1988 Recommended constitutional amendment for both rural and urban bodies

The 65th Constitutional Amendment Bill (1989) for urban bodies was also rejected in Rajya Sabha. The 74th
Amendment succeeded in 1992.

6. Urbanisation Trends in India

Year Urban Population % of Total

1951 6.2 crore 17.3%

1971 10.9 crore 19.9%

1991 21.7 crore 25.7%

2001 28.6 crore 27.8%

2011 37.7 crore 31.2%

2023 (est.) 55+ crore ~40%

Topic 2.3 — Salient Features of 74th Constitutional Amendment Act, 1992

Overview
The 74th Constitutional Amendment Act, 1992 gave constitutional status to Urban Local Bodies
(ULBs) in India. It added Part IX-A (Articles 243-P to 243-ZG) and the 12th Schedule (18 subjects) to the
Constitution. It came into force on 1 June 1993.

Feature 73rd Amendment 74th Amendment

Area Rural Urban

Part Part IX Part IX-A

Articles 243 to 243-O 243-P to 243-ZG

Schedule 11th (29 subjects) 12th (18 subjects)

Bodies Panchayats Municipalities

In force from 24 April 1993 1 June 1993

1. Three Types of Municipalities (Article 243-Q)

• Nagar Panchayat — for transitional areas (rural to urban transition)
• Municipal Council — for smaller urban areas
• Municipal Corporation — for larger urban areas
The Governor determines which category an area falls into based on population, density, revenue generated,
employment in non-agricultural activities, and economic importance.

2. Composition (Article 243-R)

• All seats filled by direct election from wards
• State legislature may provide for representation of:
• — Persons with special knowledge or experience in municipal administration (no voting rights)
• — MPs and MLAs representing areas that include the municipality
• — Chairpersons of Ward Committees

3. Ward Committees (Article 243-S)

• Mandatory Ward Committees for municipalities with population 3 lakh or more
• Composition, territorial area, and functions determined by state legislature
• Brings governance closer to neighbourhood level within cities

4. Reservation of Seats (Article 243-T)

 • SC/ST: Reservation in proportion to their population; includes offices of Chairpersons
• Women: Not less than one-third of total seats AND Chairperson offices
• OBC: State legislature may make provision — not mandated
• Rotation: Reserved seats allotted by rotation to different wards

5. Duration — 5 Years (Article 243-U)

• Fixed 5-year term for every municipality
• Fresh elections within 6 months of dissolution
• Reconstituted municipality serves only the remaining term

6. Disqualifications (Article 243-V)

• Same grounds as state legislature election disqualifications
• Minimum age: 21 years
• Disputes referred to authority determined by state legislature

7. Powers, Authority & Responsibilities (Article 243-W)

• State legislatures may endow municipalities with powers for self-government
• Municipalities may prepare and implement plans for economic development and social justice
• May be given powers regarding 18 subjects in the 12th Schedule

8. The 12th Schedule — 18 Subjects

1. Urban planning including town planning 2. Regulation of land use and construction of buildings

3. Planning for economic and social development 4. Roads and bridges

5. Water supply for domestic, industrial and commercial purposes

6. Public health, sanitation, conservancy and solid waste managemen

7. Fire services 8. Urban forestry, protection of environment and ecology

9. Safeguarding the interests of weaker sections of society10. Slum improvement and upgradation

11. Urban poverty alleviation 12. Provision of urban amenities and facilities

13. Promotion of cultural, educational and aesthetic aspects

14. Burials and burial grounds; cremations and cremation grounds

15. Cattle pounds; prevention of cruelty to animals 16. Vital statistics including registration of births and deaths

17. Public amenities including street lighting, parking lots,18.

busRegulation
stops of slaughterhouses and tanneries

9. Finance Commission (Article 243-Y)

• Same State Finance Commission as set up for Panchayats (Article 243-I) also reviews finances of
municipalities
 • Recommends measures to improve financial position of ULBs
• Governor's action taken report placed before state legislature

10. State Election Commission (Article 243-Z)

• Same State Election Commission (Article 243-K) conducts municipal elections
• Independent of state government; Commissioner secure in tenure

11. Metropolitan Planning Committee (Article 243-ZE)

• For metropolitan areas with population 10 lakh or more
• Prepares a draft development plan for the metropolitan area as a whole
• Elected members must constitute two-thirds or more of total membership
• State legislature determines composition and functions

12. District Planning Committee (Article 243-ZD)

• For every district — consolidates plans of Panchayats and Municipalities
• Prepares a draft development plan for the district as a whole
• Elected members must be at least four-fifths of total membership (proportional to rural/urban
population)

13. Bar to Court Interference (Article 243-ZG)

• Municipal elections cannot be questioned except by an election petition
• Courts have no jurisdiction to stay or interfere in ongoing elections

14. Comparison: 73rd vs 74th Amendment

Aspect 73rd Amendment (Panchayats) 74th Amendment (Municipalities)

Part Part IX Part IX-A

Articles 243–243O 243P–243ZG

Schedule 11th Schedule 12th Schedule

Subjects 29 subjects 18 subjects

Bodies Three-tier Panchayat Three types of ULBs

Special body Gram Sabha Ward Committee (3 lakh+)

Metro body — Metropolitan Planning Committee

District body — District Planning Committee

In force 24 April 1993 1 June 1993

15. Significance of 74th Amendment
• First time urban local bodies got constitutional recognition in India
• Regularised and strengthened the holding of municipal elections
• Empowered women and marginalised groups in urban governance
• Provided a framework for integrated urban planning
• Foundation for schemes like JNNURM, Smart Cities Mission, AMRUT

16. Criticisms & Limitations

• 'May' clause — states not obligated to devolve all 18 functions
• Parallel bodies (Development Authorities, Improvement Trusts) bypass ULBs
• ULBs remain financially weak — overdependent on state grants
• Ward Committees often remain dormant or not constituted
• Metro Planning Committees not functional in most cities
• District Planning Committees meet rarely; not effective
• Weak capacity of ULBs to plan and execute infrastructure projects

Despite constitutional status, Urban Local Bodies in India still lack adequate finances, functions, and functionaries.
Reforming ULBs is critical as India urbanises rapidly.

This document covers all seven topics of Unit I and Unit II of the Panchayati Raj & Urban Local Government
syllabus — from the meaning of local self government to the detailed provisions of the 73rd and 74th Constitutional
Amendment Acts.