Q. Consider the following statements with reference to the grants-in-aid to the states:
1. Statutory grants are provided to every state.
2. Discretionary grants can be given for any public purpose, even beyond the legislative competence of the Centre.
3. Constitution also provides for specific grants for raising the level of administration of the scheduled areas.
How many of the above statements are correct?
Exp) Option b is the correct answer
Statement 1 is incorrect. Article 275 empowers the Parliament to make statutory grants to the states which are in need of financial assistance and not to every state. These sums are charged on the Consolidated Fund of India every year. The statutory grants under Article 275 (both general and specific) are given to the states on the recommendation of the Finance Commission.
Statement 2 is correct. Article 282 empowers both the Centre and the states to make any grants for any public purpose, even if it is not within their respective legislative competence. Under this provision, the Centre makes grants to the states. These grants are also known as discretionary grants, the reason being that the Centre is under no obligation to give these grants and the matter lies within its discretion. These grants have a two-fold purpose: to help the state financially to fulfil plan targets; and to give some leverage to the Centre to influence and coordinate state action to effectuate the national plan.
Statement 3 is correct. Apart from the general provision in statutory grant, the Constitution also provides for specific grants for promoting the welfare of the scheduled tribes in a state or for raising the level of administration of the scheduled areas in a state including the State of Assam.
