Municipalities & Urban Local Governance in India: Evolution, Role & Impact of the 74th Amendment Act (Part 1)

Urban Local Governance (ULG) forms the third tier of administration in India, playing a crucial role in managing civic affairs and delivering essential services to urban populations. It is the closest form of government to the citizens, directly impacting their daily lives. The evolution of urban local self-government in India has been a long and complex journey, marked by colonial influences, post-independence challenges, and finally, a monumental constitutional transformation through the 74th Amendment Act, 1992. This comprehensive set of notes delves into the historical trajectory, constitutional provisions, and the profound impact of this landmark amendment on urban governance in India.

1. Introduction to Urban Local Governance

Urban Local Governance (ULG) refers to the administration of urban areas by locally elected bodies, known as Municipalities or Urban Local Bodies (ULBs). These bodies are entrusted with the responsibility of providing basic civic amenities, promoting local development, and fostering democratic participation at the grassroots level in cities and towns. The primary objective of ULG is to facilitate effective decentralisation of power, ensuring that decisions are made closer to the people they affect, leading to more responsive and accountable governance.

Before 1992, urban local bodies in India operated without a constitutional mandate, leading to their often-weakened status and erratic functioning. The 74th Constitutional Amendment Act, 1992, marked a watershed moment, granting constitutional recognition and protection to ULBs, thereby ushering in a new era of decentralised urban governance in India.

2. Evolution of Urban Local Governance in India

The roots of urban administration in India can be traced back to ancient times, but a structured system akin to modern municipalities emerged predominantly during the British colonial period.

A. Ancient and Medieval Periods

Ancient Period: Evidence from the Indus Valley Civilization suggests well-planned cities with sophisticated urban infrastructure. Texts like Kautilya's Arthashastra describe detailed town planning and municipal administration, including various committees for managing different aspects of urban life (e.g., sanitation, markets, public works).
Medieval Period: Under various dynasties like the Mauryas, Guptas, and later the Delhi Sultanate and Mughals, towns and cities had administrative systems, often headed by officials like Kotwals (police and civic chief) who were responsible for law and order, public works, and market regulation. However, these systems were largely centralised and lacked the element of local self-government.

B. British Period: The Genesis of Modern Urban Local Self-Government

The British colonial administration introduced the concept of local self-government primarily to ease their administrative burden and manage civic services in growing urban centres.

First Municipal Corporation (1687/1688): The first Municipal Corporation in India was established in Madras (Chennai) in 1687, followed by Calcutta (Kolkata) and Bombay (Mumbai) in 1726. These were primarily to collect revenue and manage local affairs for the East India Company.
Lord Mayo's Resolution (1870): Lord Mayo's Resolution on financial decentralisation partially delegated financial powers to provincial governments and encouraged the development of local self-government institutions. This was driven by the need to address financial difficulties faced by the imperial government.
Lord Ripon's Resolution (1882): Often hailed as the 'Magna Carta' of local self-government in India, Lord Ripon's Resolution aimed at giving local bodies more powers and responsibilities, promoting popular participation, and making them training grounds for representative government. It recommended:
- Establishment of local boards (rural) and municipal committees (urban) with a majority of elected non-official members.
- Relaxation of official control and creation of a non-official chairperson.
- Delegation of significant administrative and financial powers.
- Emphasis on local bodies for local services.
Royal Commission on Decentralisation (1907): This commission further emphasised the importance of local self-government and recommended measures to strengthen it, advocating for more financial resources and greater autonomy for local bodies.
Government of India Act, 1919 (Montagu-Chelmsford Reforms): Under the Dyarchy system, local self-government became a transferred subject under the control of Indian ministers, allowing greater local participation and autonomy. This marked a significant step towards democratisation.
Government of India Act, 1935: This Act introduced provincial autonomy, further devolving powers to provincial governments, which in turn were expected to strengthen local self-government. However, the provincial governments often exercised considerable control over local bodies, limiting their true autonomy.

C. Post-Independence Period (Pre-74th Amendment)

After India gained independence, the framers of the Constitution recognised the importance of local self-governance. However, unlike Panchayats, which found a mention in Article 40 (Directive Principles of State Policy), urban local bodies were not explicitly granted constitutional status.

Article 40 (DPSP): While this article mandated the State to organise village panchayats and endow them with powers, it did not explicitly mention urban local bodies.
State Subject: Urban local government remained a State Subject under the Seventh Schedule (List II, Entry 5), meaning state legislatures had the exclusive power to legislate on matters concerning ULBs.
Challenges: Despite various state legislations, ULBs faced severe challenges:
- Lack of Constitutional Status: They were creations of state laws and could be easily superseded or controlled by state governments.
- Financial Weakness: Inadequate financial resources, heavy dependence on state grants, and limited taxation powers crippled their ability to provide services.
- Irregular and Delayed Elections: Elections were often postponed or superseded by state governments, undermining democratic accountability.
- Excessive State Control: State governments exerted significant control, leading to a lack of functional autonomy.
- Lack of Trained Personnel: Shortage of skilled staff hampered efficient administration.

These challenges highlighted the urgent need for a constitutional framework to empower and protect urban local bodies, paving the way for the 74th Amendment Act.

3. The 74th Constitutional Amendment Act, 1992: A Paradigm Shift

The 74th Constitutional Amendment Act, 1992, came into effect on June 1, 1993. It aimed to revitalise and strengthen urban local self-government by providing it constitutional status and a uniform framework across the country. It added Part IXA titled “The Municipalities” to the Constitution, consisting of Articles 243P to 243ZG, and also introduced the Twelfth Schedule.

A. Background and Objectives

The need for the 74th Amendment arose from the persistent weaknesses and dysfunctional nature of urban local bodies. The key objectives were:

Constitutional Status: To give constitutional recognition to ULBs, ensuring their permanence and protecting them from arbitrary state interference.
Democratisation: To establish democratic and vibrant local self-governing institutions in urban areas through regular and fair elections.
Decentralisation: To devolve powers, responsibilities, and financial resources to ULBs, enabling them to function as effective units of local self-governance.
Financial Autonomy: To strengthen the financial position of ULBs through a structured devolution of funds, grants, and taxation powers.
Effective Planning: To integrate local-level planning with district and metropolitan-level planning.
Representation: To ensure adequate representation for Scheduled Castes (SCs), Scheduled Tribes (STs), and women, and provide a framework for their participation in urban governance.

B. Key Provisions & Articles (Part IXA)

The 74th Amendment Act introduced 18 new articles from 243P to 243ZG, laying down the foundational framework for urban local self-government.

Article 243P: Definitions: Defines “Committee,” “District,” “Metropolitan Area,” “Municipal Area,” “Municipality,” and “Panchayat” for the purpose of this Part.
Article 243Q: Constitution of Municipalities: Mandates the constitution of three types of Municipalities based on the size of the urban area:
- Nagar Panchayat: For areas in transition from a rural to an urban area (semi-urban areas).
- Municipal Council (Paurasabha): For smaller urban areas (towns).
- Municipal Corporation (Nagar Nigam): For larger urban areas (cities).
- The Governor determines a transitional area, smaller urban area, or larger urban area based on population, density, revenue generated, non-agricultural employment, and other factors.
Diagram: Types of Municipalities (Article 243Q)

Explanation:_ This flowchart illustrates how the Governor, based on specific criteria like population and economic activity, classifies urban areas into three categories, each corresponding to a distinct type of Municipality.

Article 243R: Composition of Municipalities:
- All members of a Municipality are to be elected directly by the people from the territorial constituencies (Wards) in the municipal area.
- The Legislature of a State may provide for the representation of:
  - Persons having special knowledge or experience in municipal administration (without voting rights in meetings).
  - Members of the Lok Sabha and State Legislative Assembly representing constituencies that comprise wholly or partially the municipal area.
  - Members of the Rajya Sabha and State Legislative Council registered as electors within the municipal area.
  - Chairpersons of Committees (e.g., Wards Committees).
Article 243S: Constitution and Composition of Wards Committees, etc.:
- State Legislatures can make provisions for the constitution of Wards Committees within the territorial area of a Municipality having a population of 3 lakh or more.
- State Legislatures can also make provisions for the constitution of other committees.
Article 243T: Reservation of Seats:
- SCs and STs: Seats are reserved for Scheduled Castes and Scheduled Tribes in every Municipality in proportion to their population in that municipal area.
- Women: Not less than one-third of the total number of seats are reserved for women, including those reserved for SCs and STs.
- Chairpersons: State Legislatures may also make provisions for the reservation of offices of Chairpersons in Municipalities for SCs, STs, and women.
- Backward Classes: State Legislatures may make provisions for reservation of seats and offices of Chairpersons for backward classes.
Article 243U: Duration of Municipalities:
- Every Municipality shall continue for five years from the date appointed for its first meeting.
- It can be dissolved earlier by a State law.
- If dissolved, fresh elections must be completed within six months from the date of its dissolution.
- A Municipality constituted after a dissolution before the expiration of its duration shall continue only for the remainder of the period for which the dissolved Municipality would have continued.
Article 243V: Disqualifications for Membership:
- A person shall be disqualified if disqualified under any law made by the State Legislature for the purpose of elections to the State Legislature.
- A person shall not be disqualified on the ground that he/she is less than 25 years of age if he/she has attained the age of 21 years.
- The question of disqualification shall be referred to such authority as the State Legislature may provide.

Article 243W: Powers, Authority, and Responsibilities of Municipalities:

State Legislatures may endow Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self-government.
This includes the power to prepare plans for economic development and social justice, and to perform functions and implement schemes in relation to the 18 matters listed in the Twelfth Schedule.

Table: Key Provisions of the 74th Amendment Act

Article No.	Subject Matter	Key Feature
243P	Definitions	Clarifies terms like Municipality, District, Metropolitan Area.
243Q	Constitution of Municipalities	Three-tier structure: Nagar Panchayat, Municipal Council, Municipal Corporation.
243R	Composition of Municipalities	Direct elections for members; provisions for nominated/ex-officio members.
243T	Reservation of Seats	For SCs, STs (proportionate), Women (1/3rd); optional for Backward Classes.
243U	Duration of Municipalities	Fixed term of 5 years; re-election within 6 months of dissolution.
243W	Powers, authority, and responsibilities	Devolution of powers regarding 18 items in the Twelfth Schedule.
243X	Power to impose taxes, and Funds	Authorises Municipalities to levy, collect taxes, duties, tolls, fees.
243Y	Finance Commission	State Finance Commission (SFC) to review financial position & recommend measures.
243ZA	Elections to the Municipalities	State Election Commission (SEC) to supervise, direct, and control elections.
243ZD	Committee for District Planning	Preparation of draft development plan for the district.
243ZE	Committee for Metropolitan Planning	Preparation of draft development plan for the metropolitan area.

Article 243X: Power to impose taxes by, and Funds of, Municipalities:
- State Legislatures may authorise a Municipality to levy, collect, and appropriate taxes, duties, tolls, and fees.
- State Legislatures may assign to a Municipality taxes, duties, tolls, and fees collected by the State Government.
- State Legislatures may provide for grants-in-aid to Municipalities from the Consolidated Fund of the State.
- Provision for the constitution of a Fund for crediting all moneys received by Municipalities.
Article 243Y: Finance Commission:
- The State Finance Commission (constituted under Article 243I for Panchayats) shall also review the financial position of Municipalities.
- It will make recommendations to the Governor regarding:
  - Distribution of net proceeds of taxes, duties, tolls, and fees between the State and Municipalities.
  - Determination of the taxes, duties, tolls, and fees that may be assigned to, or appropriated by, Municipalities.
  - Grants-in-aid to Municipalities from the Consolidated Fund of the State.
  - Measures needed to improve the financial position of Municipalities.
Article 243Z: Audit of accounts of Municipalities: State Legislatures may make provisions for the maintenance of accounts and their audit.
Article 243ZA: Elections to the Municipalities:
- The superintendence, direction, and control of the preparation of electoral rolls and the conduct of all elections to the Municipalities shall be vested in the State Election Commission (SEC) (constituted under Article 243K for Panchayats).
- The State Legislature may make provisions with respect to all matters relating to elections to Municipalities.
Article 243ZB: Application to Union Territories: The provisions of Part IXA shall apply to the Union Territories, subject to modifications as the President may specify.
Article 243ZC: Part not to apply to certain areas: This Part does not apply to the Scheduled Areas referred to in Article 244(1) and the Tribal Areas referred to in Article 244(2). However, Parliament may, by law, extend these provisions to such areas with modifications.
Article 243ZD: Committee for District Planning:
- In every district, a District Planning Committee (DPC) shall be constituted to consolidate the plans prepared by Panchayats and Municipalities in the district and to prepare a draft development plan for the entire district.
- The State Legislature shall make provisions regarding the composition of DPCs, election of members, and functions.
- Not less than four-fifths of the total members of a DPC shall be elected by and from amongst the elected members of the Panchayats at the district level and the Municipalities in the district.
Article 243ZE: Committee for Metropolitan Planning:
- In every Metropolitan Area (with a population of 10 lakhs or more), a Metropolitan Planning Committee (MPC) shall be constituted to prepare a draft development plan for the metropolitan area as a whole.
- The State Legislature shall make provisions regarding the composition of MPCs, election of members, and functions.
- Not less than two-thirds of the total members of an MPC shall be elected by and from amongst the elected members of the Municipalities and Chairpersons of the Panchayats in the Metropolitan Area.
Article 243ZF: Continuance of existing laws and Municipalities: All existing laws relating to Municipalities shall continue in force until repealed or amended by a competent Legislature or other competent authority, or until one year from the commencement of the 74th Amendment Act, whichever is earlier. Existing Municipalities would continue till their duration expired, unless dissolved earlier.
Article 243ZG: Bar to interference by Courts in electoral matters: The validity of any law relating to the delimitation of constituencies or the allotment of seats to such constituencies cannot be questioned in any court. No election to any Municipality can be called into question except by an election petition presented to such authority and in such manner as provided by the State Legislature.

C. The Twelfth Schedule

The Twelfth Schedule, inserted by the 74th Amendment Act, lists 18 functional items which are to be entrusted to Municipalities. These items cover a wide range of urban development and civic service responsibilities.

List of 18 Functional Items of the Twelfth Schedule:

Urban planning including town planning.
Regulation of land-use and construction of buildings.
Planning for economic and social development.
Roads and bridges.
Water supply for domestic, industrial, and commercial purposes.
Public health, sanitation conservancy, and solid waste management.
Fire services.
Urban forestry, protection of the environment, and promotion of ecological aspects.
Safeguarding the interests of weaker sections of society, including the handicapped and mentally retarded.
Slum improvement and upgradation.
Urban poverty alleviation.
Provision of urban amenities and facilities such as parks, gardens, playgrounds.
Promotion of cultural, educational, and aesthetic aspects.
Burials and burial grounds; cremations, cremation grounds, and electric crematoriums.
Cattle pounds; prevention of cruelty to animals.
Vital statistics including registration of births and deaths.
Public amenities including street lighting, parking lots, bus stops, and public conveniences.
Regulation of slaughterhouses and tanneries.

4. Impact and Significance of the 74th Amendment Act

The 74th Amendment Act brought about a revolutionary change in the landscape of urban governance in India. Its impact is multifaceted and significant:

Constitutional Sanctity and Stability: For the first time, ULBs received constitutional recognition, making their existence and functioning mandatory and protecting them from arbitrary dissolution or supercession by state governments. This provided a stable foundation for urban local self-government.
Democratic Decentralisation: The Act ensures regular elections (every five years) and mandates the establishment of an independent State Election Commission (SEC) to oversee them. This has deepened democratic roots at the urban grass-roots level.
Enhanced Representation: The provisions for mandatory reservation of seats for SCs, STs (proportionate to population), and women (one-third) have significantly broadened the participation base, bringing previously marginalised groups into the mainstream of urban decision-making. The optional provision for OBCs further enhances inclusiveness.
Financial Strengthening: The creation of the State Finance Commission (SFC) and explicit provisions for revenue assignment, grants-in-aid, and Municipal own-source revenue generation (taxes, duties, tolls, fees) aimed to improve the financial health and autonomy of ULBs.
Role in Planning: The establishment of District Planning Committees (DPCs) and Metropolitan Planning Committees (MPCs) provides a statutory framework for integrated and comprehensive urban planning, linking local plans with district and metropolitan development strategies.
Empowerment of ULBs: By entrusting 18 subjects (Twelfth Schedule) to Municipalities, the Act provided a clear mandate for their functions, enabling them to address local needs more effectively.
Uniformity: It brought a degree of uniformity in the structure and functioning of ULBs across different states, although states still retain considerable discretion in specific details.

Diagram: Impact of 74th Amendment Act

Explanation: This diagram summarises the key impacts of the 74th Amendment Act, demonstrating how it strengthened various aspects of urban local governance.

5. Conclusion & Summary

The 74th Constitutional Amendment Act, 1992, stands as a landmark in the history of urban local governance in India. By providing a constitutional framework, it transformed urban local bodies from mere administrative arms of state governments into vibrant institutions of self-government. It laid the foundation for democratic decentralisation, enhanced public participation, ensured social justice through reservations, and introduced mechanisms for financial devolution and integrated urban planning. While challenges in implementation and functional autonomy persist, the Act undoubtedly provided the necessary legal and constitutional impetus for the evolution of more responsive, representative, and effective urban governance in India.

6. Practice Questions & Answers

To test your understanding of the Municipalities and Urban Local Governance, particularly the 74th Amendment Act, attempt the following questions.

A. Multiple-Choice Questions (MCQs)

1. Which of the following articles deals with the 'Constitution of Municipalities' under the 74th Amendment Act? a) Article 243P b) Article 243Q c) Article 243R d) Article 243S

Correct Answer: b) Article 243Q Explanation: Article 243Q mandates the constitution of Nagar Panchayats, Municipal Councils, and Municipal Corporations based on the area's transition or classification as smaller/larger urban areas.

2. The 74th Constitutional Amendment Act came into force on: a) April 24, 1993 b) June 1, 1993 c) January 26, 1993 d) December 22, 1992

Correct Answer: b) June 1, 1993 Explanation: While the 73rd Amendment (Panchayats) came into force on April 24, 1993, the 74th Amendment (Municipalities) became effective on June 1, 1993.

3. Which of the following is NOT one of the three types of Municipalities envisioned by the 74th Amendment Act? a) Nagar Panchayat b) Municipal Council c) Cantonment Board d) Municipal Corporation

Correct Answer: c) Cantonment Board Explanation: The 74th Amendment Act specifically provides for Nagar Panchayats, Municipal Councils, and Municipal Corporations. Cantonment Boards are administered by the Union Ministry of Defence and are outside the purview of the 74th Amendment.

4. The superintendence, direction, and control of the preparation of electoral rolls for Municipalities is vested in: a) Election Commission of India b) District Collector c) State Election Commission d) State Legislature

Correct Answer: c) State Election Commission Explanation: Article 243ZA explicitly vests the authority for electoral matters of Municipalities in the State Election Commission.

5. What is the minimum age for a person to be qualified as a member of a Municipality, as per the 74th Amendment Act? a) 18 years b) 21 years c) 25 years d) 30 years

Correct Answer: b) 21 years Explanation: Article 243V states that a person shall not be disqualified if he/she has attained the age of 21 years, even if they are less than 25 years.

6. The Twelfth Schedule of the Constitution deals with: a) Languages of India b) Division of powers between Union and States c) Powers, authority, and responsibilities of Panchayats d) Powers, authority, and responsibilities of Municipalities

Correct Answer: d) Powers, authority, and responsibilities of Municipalities Explanation: The Twelfth Schedule lists 18 functional items that fall under the purview of Municipalities, as outlined in Article 243W.

7. Lord Ripon's Resolution of 1882 is often referred to as the 'Magna Carta' of local self-government in India. What was one of its key recommendations? a) Centralisation of local administration under the Viceroy. b) Establishment of local bodies with a majority of elected non-official members. c) Abolition of local taxes to reduce burden on citizens. d) Complete financial autonomy for local bodies without state grants.

Correct Answer: b) Establishment of local bodies with a majority of elected non-official members. Explanation: Lord Ripon's Resolution aimed to promote popular participation by recommending elected non-official majorities in local bodies.

8. The District Planning Committee (DPC) is constituted under which Article of Part IXA? a) Article 243ZC b) Article 243ZD c) Article 243ZE d) Article 243ZG

Correct Answer: b) Article 243ZD Explanation: Article 243ZD provides for the constitution of a District Planning Committee to consolidate plans prepared by Panchayats and Municipalities.

9. Not less than ________ of the total number of seats in every Municipality shall be reserved for women. a) one-fourth b) one-third c) one-half d) two-thirds

Correct Answer: b) one-third Explanation: Article 243T mandates that not less than one-third of the total seats, including those reserved for SCs and STs, shall be reserved for women.

10. Which constitutional amendment inserted Part IXA and the Twelfth Schedule into the Constitution of India? a) 73rd Amendment Act b) 74th Amendment Act c) 42nd Amendment Act d) 61st Amendment Act

Correct Answer: b) 74th Amendment Act Explanation: The 74th Constitutional Amendment Act, 1992, inserted Part IXA (The Municipalities) and the Twelfth Schedule (listing 18 functional items) into the Constitution.

B. Scenario-Based Questions

Scenario 1: A state government decides to indefinitely postpone the municipal elections in a major city, citing "administrative difficulties" and "ongoing delimitation processes." Is this action constitutionally valid? Justify your answer.

Answer: No, this action is not constitutionally valid under normal circumstances. Justification: Article 243U of the 74th Amendment Act mandates that every Municipality shall continue for five years from the date appointed for its first meeting. If dissolved earlier, fresh elections must be completed within six months from the date of its dissolution. There is no provision for indefinite postponement of elections. While delimitation processes might be a valid reason for a temporary delay, citing "administrative difficulties" to indefinitely postpone elections goes against the spirit and letter of the 74th Amendment, which aimed to ensure democratic functioning and regular elections for ULBs. The State Election Commission (SEC), empowered by Article 243ZA, is responsible for conducting these elections and would likely challenge such a move.

Scenario 2: A newly elected Municipal Corporation in a metropolitan area wants to formulate a comprehensive development plan for its jurisdiction. However, the state government insists that all planning must be done at the state level. Which constitutional body could help resolve this conflict and ensure integrated local planning?

Answer: The Metropolitan Planning Committee (MPC), constituted under Article 243ZE, is the constitutional body designed to address this issue. Justification: Article 243ZE mandates the constitution of an MPC in every Metropolitan Area to prepare a draft development plan for the metropolitan area as a whole. This committee consolidates the plans prepared by the Municipalities and Panchayats in the area, taking into account the overall development objectives. The state government's insistence on exclusive state-level planning contradicts the decentralised planning mechanism established by the 74th Amendment through the MPC, which ensures local participation and integration of grassroots plans. The MPC acts as a bridge between local aspirations and broader metropolitan development, ensuring that plans are locally relevant yet holistically integrated.

C. Match the Following

Match the Constitutional Article with its corresponding subject matter:

Column A (Article)	Column B (Subject Matter)
1. Article 243ZA	a. Duration of Municipalities
2. Article 243Y	b. Elections to the Municipalities
3. Article 243U	c. Reservation of Seats for SC, ST, and Women
4. Article 243T	d. Finance Commission for Municipalities
5. Article 243W	e. Powers, authority, and responsibilities (XII Schedule)

Answer:

Article 243ZA - b. Elections to the Municipalities
Article 243Y - d. Finance Commission for Municipalities
Article 243U - a. Duration of Municipalities
Article 243T - c. Reservation of Seats for SC, ST, and Women
Article 243W - e. Powers, authority, and responsibilities (XII Schedule)

References: Sanyal, S. (2014). Local Self-Government. Global Encyclopaedia of Indian Politics, 203-212. The Constitution (Seventy-Fourth Amendment) Act, 1992. (1992). India. Retrieved from https://legislative.gov.in/sites/default/files/A1992-56.pdf

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