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UPSC MainsGeneral Studies Paper IIIndian PolityPractice question

Perennial Centre-State Disputes in Indian Federalism

Despite constitutional division of powers, why are Centre-State disputes a perennial feature of Indian democracy?

~250 words2 min readmedium
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How to approach

Begin by introducing India's quasi-federal constitutional design under the Seventh Schedule and the recurring nature of Centre-State friction as demonstrated by Article 131 litigations. Then, evaluate major structural and operational drivers of friction across fiscal, gubernatorial, legislative, and institutional domains. Conclude by outlining a forward-looking roadmap rooted in cooperative federalism and key committee recommendations.

Model answer

385 words

Introduction

The Seventh Schedule of the Constitution of India provides for an explicit division of powers between the Union and the States. However, the constitutional framework exhibits a marked unitary tilt, creating a quasi-federal system where Centre-State disputes remain a perennial reality, as reflected in the growing number of original suits filed before the Supreme Court under Article 131.

Key Drivers of Centre-State Friction

  • Fiscal Centralisation: The excessive reliance on cesses and surcharges—which account for approximately 14.5% of the Centre's Gross Tax Revenue (2023–24)—directly circumvents the divisible tax pool shared with states under Article 270. In addition, curbs on state borrowing via Net Borrowing Ceilings have prompted states such as Kerala to challenge Union fiscal directives under Article 131.
  • Gubernatorial Overreach: The office of the Governor has emerged as a significant flashpoint regarding assent to state legislation under Article 200. In State of Punjab v. Principal Secretary to the Governor of Punjab (2023), the Supreme Court clarified that Governors cannot indefinitely sit on bills to paralyze state legislatures.
  • Politicisation of Central Investigative Agencies: The jurisdictional reach of federal agencies has created friction, leading over ten states to withdraw general consent to the Central Bureau of Investigation (CBI) under the Delhi Special Police Establishment Act. The Supreme Court upheld the maintainability of West Bengal's Article 131 suit contesting unilateral CBI investigation inside state boundaries.
  • Use of Emergency and Central Powers: While the misuse of President's Rule under Article 356 has been significantly constrained following the landmark S.R. Bommai v. Union of India (1994) judgment, operational mistrust over central oversight, legislative pre-emption on Concurrent List subjects, and law-and-order interventions remains prevalent.

Way Forward to Foster Constitutional Harmony

  • Institutional Re-activation: Institutionalise regular deliberations of the Inter-State Council under Article 263 to ensure structured pre-legislative consultation on Concurrent List subjects.
  • Implementation of Commission Recommendations: Enforce the recommendations of the Sarkaria and Punchhi Commissions, particularly regarding the transparent appointment and removal of Governors and time-bound action on bills.
  • Fiscal Rationalisation: Impose a constitutional or statutory cap on the share of cesses and surcharges to prevent the persistent shrinking of the states' divisible pool.

Conclusion

To safeguard constitutional federalism, Indian governance must transition from contestatory federalism to genuine cooperative federalism. Resolving structural disputes through mutual institutional respect, statutory fiscal equity, and active dialogue via intergovernmental forums is essential to sustaining democratic stability.

Key facts to remember

statistic

Cesses and surcharges constituted around 14.5% of the Union Government's Gross Tax Revenue in 2023–24, bypassing the divisible pool meant for tax devolution to states.

— Union Budget Documents (2023–24)
case study
State of Punjab v. Principal Secretary (2023)

The Supreme Court ruled that Governors cannot hold back assent or indefinitely sit on bills passed by the state legislature, reiterating that a Governor is a constitutional head and cannot subvert elected legislatures.

scheme
Inter-State Council (Article 263)

A constitutional body established to inquire into, discuss, and advise on disputes and subjects of common interest between the Union and the States, promoting coordinated policy making.

Frequently asked questions

Why do states invoke Article 131 against the Union Government?

Article 131 grants exclusive original jurisdiction to the Supreme Court for legal disputes between the Government of India and one or more States concerning constitutional rights and division of powers.

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