Having own Finance Commission

24/11/2020

Under the Constitution of India it is necessary for the Central Government to pay grant-in-aid to the Federating units to enable them to cover gaps in their income and expenditure and there are certain taxes which are levied and collected by the Union Government and proceeds of these taxes are also shared by the Centre and the Union Territory of Jammu and Kashmir in accordance with a formula evolved and adopted by the Finance Commission. In a first, Jammu and Kashmir will have its own Finance Commission which will be constituted by the President of India with a term of five years while the Parliament of India will determine pre-requisites for appointment as members of the Commission and the manner in which they will be selected. After every five years, the new Finance Commission will come into force. The Commission will almost be in lines with the Finance Commission of India and guiding force in regulating finances in the Union Territory of Jammu and Kashmir. The Commission will make recommendations to the President on the principles which should govern the grants-in-aid of the revenues out of the Consolidated Fund. It will also suggest the measures needed to augment the Consolidated Fund to supplement resources of the Panchayats on the basis of recommendations by the Finance Commission of the country.
As earlier highlighted by JOURNEY LINE the Finance Commission will also suggest measures needed to augment the Consolidate Fund to supplement resources of the Municipalities and other issues which may be referred to it. The reconciliation of accounts of first quarters will be done from August 1-15, second quarter from November 1-15, third quarter from February 1-15 and fourth quarter from June 1-15. Budget Controlling Officers would check in advance for the dates allotted for conduct of quarterly reconciliation and accordingly depute their teams. Responsibility for maintenance of these accounts should be of the Resources Division of the Finance Department. Immediately after budget of a financial year is approved, the Finance Department will open individual accounts of every identified source of flow of funds from the Centre to the Union Territory of Jammu and Kashmir. Though the accounts will be maintained on yearly basis, but at the same time, these should be arranged in a manner that their position is readily and easily ascertained for the block periods covered by the Finance Commission and various Central Ministries respectively for Revenue and Capital transfers," sources said.

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