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CS Professional · CSR and Social Governance · Local Self Governance

A State constituted its first State Finance Commission in 1994. The State government now asks when the next Commission must be constituted. Under the constitutional scheme for local body finances, what is the correct position?

A new State Finance Commission must be constituted at the expiry of every fifth year. The Constitution fixes this five-year cycle, so it is mandatory and does not depend on the Governor's discretion, ten-year cycles or the Census.

  1. AA new Commission must be constituted at the expiry of every fifth yearCorrect
  2. BA new Commission is needed only when the Governor feels the need to do so
  3. CA new Commission must be constituted every ten years
  4. DA new Commission is required only after each Census

Explanation

The Constitution provides that the Governor shall constitute a Finance Commission at the expiration of every fifth year. So the periodicity is fixed at five years and does not depend on discretion, a decennial cycle or the Census. Options suggesting discretion or ten years contradict the text.

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