Concept and Development of Federalism

Introduction

Etymologically, the word federation is derived from the Latin word “foedus” which means treaty or agreement. The treaty/agreement embodies the details of the distribution of powers between the constituent units and the Union Government. As such, it is a sacred document. It is the Supreme law of the land as it contains division of powers between Central Government and State Governments. Federalism as a form of government was, for the first time, put into practice in the United States way back in 1789, when the thirteen erstwhile British colonies, which were independent units, signed a compact to form a new political unit to be known as the United States of America (USA)[1]. Since then a number of such unions have been formed in Canada, Australia, South Africa, and India in 1950.

Meaning of Federalism

Federalism is, therefore, a concept which unites different states but does not sacrifice their fundamental, political and administrative autonomy.

Federalism is at its core a system where the dual machinery of government functions. Generally, under federalism, there are two levels of government. One is a central authority which looks after the major affairs of the country. The other is more of a local government which looks after the day to day functioning and activities of their particular region.

A federation is a compromise between regional autonomy and national integration. Both regional and national governments derive their power from the federal Constitution.

Essential features of federalism

A federal system of governance contains following the features:

1.     Written Constitution:

A federal state derives its existence from the Constitution, just as a corporation derives its existence from the grant or statute by which it is created. Every power – executive, legislative or judicial- whether it belongs to the federation, or to the component States, is subordinated to and controlled by the Constitution. Therefore, a federal State requires a written Constitution for the obvious reason that in order to be workable and stable and the limitations upon them to be enforceable, must be precisely defined by a written instrument. Thus, even though Australia adopted the system of responsible government (or the Cabinet system) from the unwritten Constitution of the U.K., it had to be embodied in a written Constitution.

2.     No Unilateral Change:

It is not possible to maintain the other features of federalism unless the Constitution is rigid and all the provisions are reduced into writing.However, rigidity does not mean that there is no scope for amending the Constitution to deal aptly with various kinds of unforeseen situations, but the foregoing distribution of powers made by the Constitution cannot be changed or amended at the unilateral will of the parties to the federation, i.e; the Federal Government or the Regional Governments. The Constitution provides a process for changing its provisions, called ‘amendment’. In other words, the Federal nations generally have rigid Constitution.

3.     Supremacy of the Constitution:

Every action and policy as well as the power of the State or Centre is subordinate to and controlled by the Constitution. According to Prof K.C. Wheare, “The Supreme Constitution is essential if the government is to be federal…….”[2]

4.     Duality of Government:

While in a unitary State there is only one government, i.e. Central Government, in a federal state there are two governments, the Federal or Central Government and the Government of each constituent State.

5.     Distribution of Powers:

The most essential feature of a federal system is the distribution of powers between two governmental units – national and regional. However, even in a unitary system, there is some distribution or devolution of powers as between the national and local governments, but no Court can interfere if the national government withdraws or revokes the powers which had been delegated by itself to the regional administration.

Whereas in the federation, the regional units derive their powers, not by delegation from the national government, but from the same source as does the national government itself, viz., the Constitution, and the distribution of powers between the two units, which is made by the Constitution, is binding on the national as much as on the regional Governments, so that if either the general or a regional government transgresses the boundaries demarcated by such constitutional distribution of powers, its act would be pronounced by the Courts to be unconstitutional and void. The Constitution distributes powers between the two Governments in such a way that the governmental organs of each of the two Governments operate with direct authority over the citizens. In the case of a regional government, it has authority over the citizens residing within the territory of that region, while in the case of the federal government; its authority extends over citizens residing over the entire territory of the country, irrespective of the territorial barriers of the units of the federation.

6.     Interpretation By Judiciary:

The distribution of powers made by the Constitution must be guarded by the Judiciary, which is to interpret the Constitution as the ‘fundamental law’ of the land and to enforce its provisions against both the Federal and Regional Governments and to invalidate any of their acts which transgresses the limitations imposed upon them by the Constitution. Where the federal States have separate Constitutions, the problem arises as to how far the Constitutional decisions of the Federal Supreme Court shall be binding upon the States and their Courts. In this context, it was laid down in the case of Marbury vs. Madison[3]that the Federal judiciary is supreme in the exposition of the law of the Constitution, and that principle has ever since been respected by this Court and the Country as a permanent and indispensable feature of the constitutional system.

Federal and Non Federal features of Indian Constitution

Features features of Indian Constitution

The following federal features are present in the Indian Constitution:

1.     Duality of Government:

Indian Constitution establishes dual polity, a two tier government system with Central Government at one level and State Governments at the other.  But later, a third level of Government, i.e. Panchayats and Municipalities were created through 73rd and 74th Constitutional Amendments in 1992. So, in India the Constitution envisages not two but three levels of government. This is a novel form of federation, unknown to the outside world. So Indian federalism is a sui generis system.

2.     Division of Power:

The Constitution marks the sphere of action of each level of the government by devising an elaborate scheme of distribution of legislative, administrative and financial powers between the Centre and the States. The Seventh Schedule of the Constitution makes provision for the division of powers between the Union and the States. It contains three list:

a) Union List: It comprises of 97[4]subjects of national importance and the Union Parliament alone has the power to enact laws with respect to these subjects.

b) State List: It comprises of 66[5] subjects of local importance and State legislatures have the power to enact laws with respect to these subjects.

c) Concurrent List: It comprises of 47[6] subjects and both the Parliament and the State legislature can legislate on them.

However, in case of any clash between the Central and State laws, the laws framed by the Centre will prevail.

Similarly, in the concurrent sphere, in the case of repugnancy between a Union and State law relating to the same subject, the former prevails. If, however, the State law was reserved for the assent of the Parliament and has received such assent, the State law may prevail notwithstanding such repugnancy, but it would still be competent for Parliament to override such State law by subsequent legislation.

3.     Supremacy of Constitution:

The Indian Constitution is endowed with supremacy. The Constitution is at the top of the hierarchy of all laws, i.e. both Centre and the State. The Central as well as the State Governments have to operate within the perimeters prescribed by the Constitution. If they pass any law which does not conform to the provisions of the Constitution or in any way goes beyond the Legislative authority given to them, it can be declared ultra vires to the Constitution by the Supreme Court.

4.     Written and Rigid Constitution:

The Indian Constitution is a written document containing 395 articles and 12 schedules. Further, Indian Constitution is a rigid Constitution as far as the amendment of federal provisions is concerned. Thus, the provisions can be amended if it is ratified by two-third majority of each of the two Houses of Parliament and also approved by half of the State legislature.

5.     Independent and Federal Judiciary:

The Supreme Court of India is the highest court in India. It acts as the guardian of the Constitution. It has power to decide the disputes arising either between the Union and the States or between the two or more states under its original jurisdiction under Article 131 of the Constitution. It can declare any law or order ultra vires of the Constitution if it contravenes any of the provisions of the Constitution. The Constitution provides various provisions to ensure the independence of the Judiciary from the Executive and Legislature both.

Unitary or Non Federal features of Indian Constitution

In addition to the above Federal features, the Indian Constitution contains certain non-federal or unitary features which can be discussed under the following headings:

Legislative Relations

Article 245 to 255 read with VII Schedule deals with the distribution of Legislative powers between the Union and the States. Schedule VIII contains three legislative lists i.e. Union List, State list and Concurrent list. The Parliament alone has the power to legislate on the subjects included in the Union list. The State legislatures possess the exclusive right to legislate on the subjects included in the State list. On concurrent subjects, both the Parliament and State Legislatures enjoy concurrent power to make laws. All residuary powers are assigned to the Union Government.

Thus, it can be said that ordinarily, the Parliament has no jurisdiction with respect to the subjects mentioned in the State list. However, under the following circumstances, the Parliament may make law even on State subjects:

1)    National Interest [Article 249]:

Under Article 249, if the Rajya Sabha declares, by a resolution supported by a resolution supported by two-thirds of the members present and voting, that is expedient or necessary in the national interest that Parliament should make laws with respect to a matter in the State list specified in the resolution, it becomes lawful for Parliament to make laws for the whole or any part of India with respect to that matter so long as the resolution stands.

2)    During Proclamation of Emergency [Article 250]:

Under Article 250 of the Constitution , when the state of emergency is in operation, the Parliament can make laws on State subjects which become inoperative after 6 months of the expiry of emergency.

3)    Legislation by agreement with States [Article 252]:

The Parliament can also legislate on a State subject if the legislatures of two or more states resolve that it is lawful of Parliament to make laws with respect to any matter enumerated in the State List relating to those States. Thereafter, any act passed by the Parliament shall apply to such states and to any other state which passes such a resolution. The Parliament also reserves the right to amend or repeal any such act.

4)    Legislation for giving effect to International Agreements [Article 253]:

The Parliament can make law for the whole or any part of the territory of India for implementing any treaty, international agreement or convention with any other country or countries or any decision made at any international conference, association or other body. Any law passed by the Parliament for this purpose cannot be invalidated on the ground that it relates to the subject mentioned in the State list.

5)    Emergency Provisions [Articles 352, 356 and 360]:

During emergencies, the entire federal setup of the government system becomes dependent on the mercy whims and fancies of the Centre. In the first place, the President, in his own satisfaction, can proclaim a state of Emergency under Articles 352, 356 or 360. If a state of Emergency is proclaimed the State Legislature may be dissolved or kept in suspended animation and ministers may be dismissed. The entire Legislative and financial powers would then be exercised by the Parliament and executive and administrative powers by the President of the Country.

In case of financial emergency [Article 360], the Centre can give directions to any State to observe the specified cannons of the economy. It may reduce the salaries and allowances of any category of government servants and officers both of the Union and the States, including those of the judges of the Supreme Court and the High Courts. Thus, during emergencies the little powers that the State may enjoy in normal times may be curtailed or completely taken away by the Centre.

6)    Residuary Powers of the Parliament [Article 248]:

It is quite interesting to note that the residuary powers are vested in the union, while in the United States of America and Australia, these powers are given to the states. Article 248 says that Parliament has exclusive power to make any law with respect to any matter not enumerated in any one of the three lists. This reflects the leanings of the Constitution-makers towards a strong Centre. Another notable thing regarding residuary powers is that “the final determination as to whether a particular matter falls under the residuary power or not is that of the courts.

7)    Union supremacy in case of repugnancy between a Central law and State law [Article 254]:

Article 254 provides that if any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by the Parliament, which the Parliament is competent to enact or to any provision of any existing law with respect to one of the matters enumerated in concurrent list, then subject to clause (2) of the Article 254, the law made by the Legislature of such State or as the case ,may be, the existing law, shall prevail and the law made by the legislature of the state shall, to extent of repugnancy, be void. It is submitted that Article 254 does not take away the competence of the State legislatures to make laws on the matter enumerated in the Concurrent list, but merely lay down that if it is repugnant to the Central Law then it shall be void to extent of the repugnancy. Hence, so long as there is no Central law in the field, the law enacted by the State(s) is valid.

The foregoing provisions demonstrate that there are various occasions when the Parliament can make laws on the subjects enumerated in the State list, but there is no occasion when the State Legislature can make laws on the subjects enumerated in the Union list. This proves that the legislative field of Parliament is more as compared to the State Legislatures.

Administrative Relations

The administrative relations between the Centre and the States have been stated from Article 256 to Article 263 of the Constitution. As a rule, the Central Government exercises administrative authority over all the matters on which the Parliament has the power to make laws, whereas the State Governments exercise authority over the matters included in the State List

1.     Direction to the State Governments:

Article 256 provides that the Union Government can give directions to the State regarding implementation and enforcement of central laws. The non-compliance with such directions may be deemed to be a failure of Constitutional machinery in the State. The President may, then, proclaim a state of emergency under Article 356 and assume to himself if the responsibility of governing that State.

Article 257 further provides that the executive power of the Union shall also extend to the giving of such directions to the states as it appears to the Government of India to be necessary for that purpose.

Article 339(2) of the Constitution empowers the Union to give directions to a State for the preparation and execution of schemes for the welfare of Scheduled Tribes in the State. Under Article 350A of the Constitution, directions may be given to a State for providing instructions in mother tongue at the primary stage of education to children belonging to linguistic minorities.

When an Emergency declared under Article 352 of the Constitution is in operation, the Union can, under Article 352(a) of the Constitution, give directions to a State as to a manner in which the executive power of the State is to be exercised.

According to Article 365 of the Constitution, where any State has failed to comply with, or to give effect to, any directions given in the exercise of the executive power of the Union, the President may hold that a situation has arisen in which the government of a state cannot be carried on in accordance with the provisions of the Constitution of India and the entire administration of the State may be taken over by the Centre issuing a proclamation under Article 356.

2.     Supervisory control of the Union over States:

Article 355 of the Constitution vests in the Union a very important power, i.e. power to power to exercise supervisory control over the States in the maintenance of public order. The maintenance of public order is primarily the responsibility of State Government under Article 162 of the Constitution read with Entry 1 of the State list.  It maintains the public order and tranquility through the agency of the police, which is the civil force under its command. A duty has, however, been imposed on the Union to protect every State not only against the external aggression but also against internal disturbances and to ensure that the governance of every State is carried on in accordance with the provisions of the Constitution. Under this Article, Central intervention is called for when there is internal disturbance in a State or a failure of Constitutional machinery.

3.     Entrustment of functions:

Article 258(1) of the Constitution provides that the President may, with the consent of State Government, entrust to it or to its officer’s specific executive functions of the Union either conditionally or unconditionally.

4.     Full faith and credit to Public Acts, etc.:

Article 261 of the Constitution also contains significant provisions for securing coordination between the Union and the States  and the States inter se. It requires full faith and credit to be given throughout the territory of India to public acts, records and judicial proceedings of the Union and every State. it further provides that final judgements and orders of any civil court in any part of India shall be capable of execution anywhere in the country according to law.

5.     Provision of All India Services [Article 312]:

Provision of All India Service under Article 312 of the Constitution is another area where Union Government exercises administrative control over the states. At present there are three All India Services, i.e. Indian Administrative Services (IAS), Indian Police Service (IPS), and Indian Forest Service (IFS). The members of these services are recruited and appointed by the Union Public Service Commission. The members of these services are posted on key posts in the states, but remain loyal to the Union Government.

6.     Disputes relating to Water [Article 262]:

The Parliament has been vested with power to adjudicate any dispute or complaint with respect to the use, distribution or control of the waters of, or in any inter-state river or river-valley. In this regard, the Parliament also reserves the right to exclude such disputes from the jurisdiction of the Supreme Court or other Courts.

7.     Interstate State Council [Article 263]:

Article 263 empowers the President to establish an interstate council to inquire into and advise upon inter-state disputes between the Union and the States and make recommendations for better coordination of policies and action.

8.     Appointment of Governor:

The Governor of a state is not only appointed by the President of the Country but he also holds the office during the pleasure of the President, notwithstanding the five years term. During emergency under Article 356, the Governor governs the state as the agent of the President of India, i.e. the Union Government.

9.     Appointment of Judges of High Court:

Judges of the High Courts are appointed by the President in consultation with the Governor of the State under Article 217 of the Constitution, and the states do not play any role in this.

So, it can be found that these powers of the Union interfere with the State authority in the field of administration. Further it must be noted that it is mandatory for States to obey the directions issued by the Union, because if any state fails to do so, then the President may conclude that the administration of the State is not being carried in accordance with the provisions of the Constitution and it may even lead to the imposition of the President Rule in that state. [Article 365]

Financial Relations

Financial Relations is provided in Part XII, Chapter1 from Article 264 to 281. Union and State work together to maintain the nation’s economy. Union makes laws on the Tax subject provided in List I. Union collects, levy and appropriate revenue on the items listed in the Union List. Example: Custom Duties etc. States make laws on the tax subject provided in List II. State collect, levy and appropriate revenue on the items listed in the State List. Example: Tax on Agricultural Income, Land Revenue etc. States also collect certain revenue which the Union levy upon them. Stamp Duties is one of them. Some taxes are collected and levied by the Union Government but these are distributed between State and States. Excise Duties are one of them. 

The Constitution provides, in Legislation List I and II, for separate heads for taxation to Union and States- there is no concurrent jurisdiction of taxation. The residuary power for taxation (such as gift tax, wealth tax and expenditure tax) vests with the Parliament. The Constitution under Article 274 provides that no bill can be moved,  or amendments introduced, on the subject of levy of taxes, except on the recommendation of the President in case of Centre and that of Governor in case of the States. Further Central Government exercises financial control over the States through Grant-in-Aids under Articles 273, 275, 282. If financial emergency is declared by the President under Article 360, on the grounds that financial stability or credibility of India or any of its units is threatened, all the Money Bill passed by the State legislatures during the period of financial emergency are also subject to the control of the Centre.

So, the Union has supremacy over the financial relations over the States. In a federation, as far as possible, States should be financially self-sufficient so that these enjoy maximum autonomy. But in India, the States depend on the Centre for all development. They have much less sources of income but many more needs of expenditure. This financial dependency has very much hindered the growth of States on federal lines.

Judicial View of Indian Federalism                                                                        

In Berubari Union and Exchange of Enclave (in re),[7] Gajendragadkar, J speaking for (eight judges Bench) held that: Unlike other federations, the federation embodied in the said Act was not the result of a pact or Union between separate and independent communities of States who came together for certain common purpose and surrendered a part of their sovereignty. The constituent units of the federation were deliberately operated and it is significant that they, unlike the units of other federations, had no organic roots in the past. Hence, in the Indian Constitution, by contrast with the other Federal Constitutions, the emphasis on the preservation of the territorial integrity of the constituent States is absent.

In State of West Bengal v. Union of India,[8] This case of 1963 offers the first instance of this category where this issue was discussed at length by the Apex Court. The main issue involved in this case was the exercise of sovereign powers by the Indian states. The legislative competence of the Parliament to enact a law for compulsory acquisition by the Union of land and other properties vested in or owned by the state and the sovereign authority of states as distinct entities were also examined. The Apex Court held that the Indian Constitution did not propound a principle of absolute federalism. Justice Subba Rao dissented with the majority opinion, he observed that within their respective sphere both in the Legislative and Executive fields Union and the States are supreme; their relationship is regulated by specific Constitutional provisions

In Kesavananda Bharati v. State of Kerala,[9]the Supreme Court held that the Indian Constitution is federal in character and not unitary. It was said that in a federal structure of government, the existence of both the Union and the States is indispensable and so is the power of judicial review.

In the State of Rajasthan & Ors. v. Union Of India[10]Beg, C.J observed that Indian union is federal. But, the extent of federalism in it is largely watered down by the needs of progress and development of a country which has to be nationally integrated, politically and economically coordinated, and socially, intellectually and spiritually uplifted. In such a system, a State cannot stand in the way of legitimate and comprehensively planned development of the country in the manner directed by the Central Government.

A Division Bench of the Madras High Court in M. Karunanidhi v. Union of India,[11]while dealing with the contention that the Constitution is a federal one and that the States are autonomous having definite powers and independent rights to govern, and the Central Government has no right to interfere in the governance of the State, the High Court observed that “To apply the meaning to the word ‘federation’ or ‘autonomy’ used in the context of the American Constitution, to our Constitution will be totally misleading. The feature of the Indian Constitution is the establishment of a Government for governing the entire country. In doing so, the Constitution prescribes the powers of the Central Government and the powers of the State Governments and the relationship between the two. In a sense, if the word ‘federation’ can be used at all, it is a federation of various States which were designated under the Constitution for the purpose of efficient administration and governance of the country. The powers of the Centre and States are demarcated under the Constitution. It is futile to suggest that the States are independent, sovereign or autonomous units which had joined the federation under certain conditions. No, such a State ever existed or acceded to the Union.”

In State of Karnataka v. Union of India and Anr,[12]The Supreme Court held that, strictly speaking, our Constitution is not of a federal character where a separate, sovereign or independent State could be said to have joined to form a nation as in the United States of America or as may be the position in some other countries of the world. It is because of that reason that sometimes it has been characterized as quasi federal in nature.

In State of Uttar Pradesh v. Zavad Zama Khan[13], the Supreme Court held that our Constitution is a combination of federal structure with unitary features. Under our Constitution, certain powers vest in the Central Government leaving certain powers to its component units to exercise autonomy in spheres assigned to them in the Constitution itself. The component States are not delegates or agents of the federal Government. Both federal and State Governments draw their autonomy from the same source, i.e. the Constitution.

In S.R Bommai v. Union of India,[14] the Apex Court observed that the expression ‘federation’ or ‘federal form of government’ has no fixed meaning. It broadly indicates a division of powers between a central (federal) government and the units (States) comprising therein. No two federal Constitutions are alike. Each of them, be it USA, Canada, Australia, or of any other country, has its own distinct character. It is, therefore, futile to ascertain and fit our Constitution into any particular mould. It must be understood in the light of our own historical process and constitutional evolution. One thing is clear: it was not a case of independent States coming together to form a Federation as in the case of the USA.

In Kuldip Nayar v. Union of India,[15] The Supreme Court observed that Indian Federation is a unique federation. It is in a sense a class by itself. It does not fit in any of the norms accepted for a federal Constitution. There can be no quarrel with the proposition that the Indian model is broadly based on a federal form of governance with a tilt towards the Centre.

So, it can be finally concluded keeping in mind the judicial pronouncements of Apex Court that every country frames a Constitution that suits its needs. The Indian Constitution is federal in form but the Indian federation is not a copy of any other federation. The constitution embodies the experience of the people of the country and is meant to serve the deal the people have kept before themselves. As such it is bound to differ from other similar Constitutions.

Conclusion

Under the impact of wars, international crisis, scientific and technological developments, and the emergence of the political philosophy of the social welfare state, the whole concept of federalism has been undergoing a change; centralizing tendencies have become manifest, and strong national governments have emerged in practically every federation. Taking note of these developments, and keeping in view the practical needs of the Country, the Constitution makers designed for India a federal structure, not with a view to its conformity with some static or theoretical pattern, but to sub-serve the needs of a vast and diverse country like India.

The Indian Constitution-makers were swayed not by any theoretical or a priori, but by pragmatic, considerations in designing federalism. The Constitution initiates a few new trends in the area of federalism. The scholars have characterized the Constitution in various ways, example, quasi-federal, unitary with federal features, and federal with unitary features, centralized federation etcetera. The fact, however, remains that though the Centre in India is strong, and utmost intergovernmental cooperation is sought to be promoted within the Constitutional framework, yet the States are not agents of the Centre; they exist under the Constitution and not at the sufferance of the Centre; they enjoy large amount of autonomy in normal times; their powers are derived from the Constitution and not from the Central laws; and the federal portion of the Constitution can be amended not unilaterally by the Centre alone but only with the cooperation of the Centre and the States. These aspects constitute the elements and essence of federalism and these are all present in the Indian Constitution. Federalism has been declared to be an essential feature of the Constitution and part of its basic structure.


[1] M.P Jain, Indian Constitutional Law, LexisNexis, (2019).

[2] K.C. Wheare, Federal Government, (1963) edition.

[3] (1803) 1 Cr 137.

[4] If we see the last entry in the Union List, it is still numbered as 97, but the total number of entries at present is 100. The entries numbered as 2A, 92A, 92B, 92C have been added and entry 33 has been omitted.

[5] If we see the last entry in the State List, it is still numbered as 66, but the total number of entries at present is 61. The entries numbered as 11, 19, 20, 29 and 36 have been omitted.

[6] If we see the last entry in the Union List, it is still numbered as 47, but the total number of entries at present is 52. The entries numbered as 11A, 17A, 17B, 20A, 33A have been added.

[7] AIR 1960 SC 858.

[8] AIR 1963 SC 1241.

[9] AIR 1973 SC 1461

[10] AIR 1977 SC 1361.

[11] 1977 CriLJ 1876.

[12] AIR 1978 (2) SCR 1.

[13] AIR 1984 SC 1095.

[14] AIR 1994 SC 1918.

[15] (2006) 7 SCC 1.


References

  1. The Constitution of India.
  2. Shukla, V.N, Constitution of India, Eastern Book Company, 2018.
  3. Pandey, J.N, Constitutional Law of India, Central Law Agency, 2018.
  4. Jain, M.P, Indian Constitutional Law, LexisNexis, 2019.
  5. Wheare, K.C, Federal Government, 1963 edition.
  6. Austin Granville, The Indian Constitution: Cornerstone of a Nation, Oxford India Paperbacks, 1999.
  7. All India Reporter
  8. Criminal Law Journal
  9. SCC online
  10. Livelaw.in
  11. Drishti IAS.

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