Chapter 13 — Federal Relations: Law, Administration and Public Money

Why this chapter matters

India combines a Union government with State governments under one Constitution. It is not a compact among sovereign States that may withdraw at will. Nor is it a system in which every public decision is made in New Delhi. The Constitution distributes legislative subjects, executive responsibilities, revenue sources and institutions for consultation. For an AP Police candidate, the key is to identify which government may act, under which constitutional route, and what happens when rules overlap.

This chapter uses “Centre” as a familiar study shorthand for the Union government. In constitutional writing, the Union and the States are the more precise terms. Federalism becomes easier when studied through four connected questions:

1. Who may make the law?
2. Who must administer it?
3. Who pays for the public service?
4. What constitutional mechanism resolves overlap or dispute?

1. Legislative relations: the territorial rule and the subject rule

Articles 245–255 deal principally with the distribution of legislative power. Article 245 concerns the territorial extent of laws: Parliament may make laws for the whole or any part of India, while a State Legislature may make laws for the whole or any part of that State. A Parliamentary law is not invalid merely because it has extra-territorial operation, subject to the constitutional limits that apply.

The subject-wise distribution is set out in the Seventh Schedule. It contains the Union List, State List and Concurrent List. A list is a constitutional allocation, not a list of ministries. A ministry may administer several subjects, and a subject may involve more than one level of government.

Union List

Parliament has exclusive power to legislate on subjects assigned to the Union List, subject to the Constitution. National defence, foreign affairs, currency and inter-State railways illustrate the national character of many entries. The list also contains subjects whose uniform treatment is important across the country. Do not assume that every subject with national importance is automatically in the Union List; the entry in the Schedule and relevant judicial interpretation control.

State List

State Legislatures ordinarily have exclusive authority over State List subjects. Public order and police are classic examples. This explains why day-to-day policing, public order management and many police-service arrangements are primarily State responsibilities, while Parliament may still legislate on related matters placed in other lists or under a special constitutional route.

“Police” and “public order” are distinct entries. They are often relevant together, but a question asking for a constitutional list should be answered from the entry itself. This is an important exam distinction: a criminal offence may be defined by a law on a Concurrent List subject even though police investigation and public order administration are primarily State functions.

Concurrent List

Both Parliament and State Legislatures may legislate on Concurrent List subjects. Criminal law and criminal procedure, marriage and divorce, education, forests, and labour welfare are useful examples, though each entry has its own wording and exceptions. The fact that a topic is shared does not mean every law must be identical. It means both levels have constitutional competence, with Article 254 supplying a rule for a particular kind of inconsistency.

Residuary subjects

Article 248 and Union List Entry 97 place residuary legislative power with Parliament. This concerns matters not enumerated in the State or Concurrent Lists, including residuary taxation power, subject to the Constitution. A candidate should not confuse “residuary” with “concurrent”: the former is allocated to Parliament; the latter is shared by its list design.

2. When Parliament may legislate on a State List subject

The ordinary rule is State competence over State List entries. The Constitution nevertheless provides exceptional routes for Parliament to legislate on such subjects. These are not general transfers of all State power; each route has its own trigger and limits.

• Article 249 — national interest: The Rajya Sabha may pass a resolution, supported by not less than two-thirds of members present and voting, declaring it necessary or expedient in the national interest for Parliament to legislate on a specified State List matter. The resolution is time-limited and may be renewed under the Article. The resulting Parliamentary law has the duration and post-resolution effect specified by Article 249.
• Article 250 — Emergency: During a Proclamation of Emergency, Parliament may legislate on State List matters. The law’s continued operation after the Proclamation ends is governed by the Article’s sunset rule.
• Article 252 — State request: If two or more State Legislatures resolve that Parliament should legislate on a State List matter for them, Parliament may enact a law for those States and other States that later adopt it. Amendment or repeal of that Parliamentary law for the participating States is also through Parliament, not an individual participating State Legislature.
• Article 253 — international obligations: Parliament may make laws for the whole or any part of India to implement a treaty, agreement or convention with another country, or a decision made at an international conference, association or other body. This power can extend to a State List subject.
• Article 356 — failure of constitutional machinery in a State: During a valid Proclamation, Parliament may exercise the legislative powers of the State Legislature, subject to the constitutional scheme and the Proclamation.

These provisions are frequently tested as “exception to the ordinary distribution.” The correct response is not that the State List disappears. Rather, the Constitution identifies situations in which Parliament receives a defined legislative route.

3. Repugnancy: Article 254 and the careful two-step test

Article 254 concerns inconsistency between a Parliamentary law and a State law on a Concurrent List matter. It should not be casually applied to every disagreement between governments.

Use this exam sequence:

1. Identify whether both laws concern a Concurrent List matter.
2. Determine whether the provisions are truly inconsistent in the constitutional sense, rather than merely different in wording or policy emphasis.
3. If repugnancy exists, the Parliamentary law generally prevails and the State law is void to the extent of the repugnancy.
4. Under Article 254(2), a State law on a Concurrent List matter that has been reserved for the President and received the President’s assent may prevail within that State over an earlier Parliamentary law or existing law, subject to the clause.
5. Parliament may later add to, amend, vary or repeal the State law under Article 254(2)’s proviso.

The phrase “to the extent of the repugnancy” matters. It warns against claiming that every part of a State enactment automatically falls merely because one provision conflicts. The precise legal effect depends on the conflict and applicable doctrine. Presidential assent under Article 254(2) is also not permanent immunity from later Parliamentary legislation.

4. Executive relations: laws must be carried out across levels

Legislative competence is only part of federalism. Articles 256 and 257 govern important aspects of Union-State executive relations. Article 256 requires State executive power to be exercised so as to ensure compliance with laws made by Parliament and existing laws that apply in the State. The Union may give directions for that purpose, subject to the constitutional text.

Article 257 states that a State’s executive power must be exercised so as not to impede or prejudice the exercise of the Union’s executive power. It also permits directions in specified matters, including communications of national or military importance and measures for protection of railways. The Constitution also addresses costs associated with directions in relevant circumstances.

Articles 258 and 258A provide routes for entrusting functions between the Union and States, with consent where the Constitution requires it. Article 261 supports recognition of public acts, records and judicial proceedings across India. These provisions help a single constitutional system function without pretending that every department is part of one administrative chain.

A practical example

Imagine a national law assigns a duty to State authorities. The State implements that law through its own administration. The Union and State have different constitutional identities, but implementation must respect the law and the relevant provisions on executive relations. For an exam response, first name the Article and the constitutional relationship; do not infer that Union funding alone transfers the underlying subject to the Union List.

5. Inter-State coordination and dispute resolution

Federalism requires both autonomy and coordination. Article 263 allows the President to establish an Inter-State Council if it appears that public interests would be served. Its functions may include investigating and discussing subjects of common interest, making recommendations for better coordination, and discussing disputes between States where the President considers such discussion appropriate. The Council is not a court and its recommendations do not replace judicial adjudication where a legal forum is provided.

Article 262 permits Parliament to provide by law for adjudication of disputes relating to the use, distribution or control of waters of, or in, any inter-State river or river valley. Parliament may also provide that neither the Supreme Court nor another court exercises jurisdiction over such a dispute as the law specifies. The exact statutory framework is separate from the bare constitutional enabling provision.

Article 131 gives the Supreme Court original jurisdiction in specified disputes between the Union and one or more States, or between States, where the dispute involves a question on which the existence or extent of a legal right depends. It is not a general appeal forum for every political disagreement. For examination purposes, keep the Article 131 route distinct from the Article 262 river-dispute framework and from intergovernmental consultation.

6. Financial relations: constitutional sharing, not a single wallet

The Constitution distributes taxing powers and creates mechanisms for sharing certain revenues. Articles 268–281 form an important part of this scheme. A useful mental model separates:

• the authority to levy a tax;
• the authority to collect it;
• the government to which proceeds are assigned; and
• the distribution of shareable proceeds between the Union and States.

These are not always the same government. The Constitution’s tax provisions distinguish categories, and amendments have changed the framework over time. For current exam preparation, consult the consolidated Constitution in force at the stated edition date rather than memorising an old coaching chart.

Finance Commission — Article 280

The President constitutes a Finance Commission at the intervals specified in Article 280: every fifth year or earlier if considered necessary. It consists of a Chairperson and four other members. Parliament may determine member qualifications and the manner of selection by law.

Its core recommendations cover the distribution between the Union and States of the net proceeds of shareable taxes, the allocation of State shares, and principles governing grants-in-aid to States. Article 280 also includes measures needed to augment State Consolidated Funds to supplement Panchayat and Municipal resources, based on recommendations of the respective State Finance Commissions. The President may refer other matters in the interests of sound finance. Under Article 281, recommendations and an explanatory memorandum on action taken are laid before each House of Parliament.

The Finance Commission is a constitutional commission, not a permanent grant office that itself releases every rupee. Its role is recommendation within the constitutional framework; the Union’s response and the relevant budgetary and legal processes matter.

State Finance Commissions and local bodies

Articles 243-I and 243-Y provide for State Finance Commissions relating respectively to Panchayats and Municipalities. They review the financial position of local bodies and recommend principles concerning distribution of State revenues, assignment of taxes and grants. This creates a chain: local needs are reviewed at State level, and Article 280 expressly allows the Union Finance Commission to recommend measures to augment the State Consolidated Fund for local-body resources on the basis of State Finance Commission recommendations.

Do not confuse a State Finance Commission with the Union Finance Commission. The appointing authority, constitutional Article and government level differ.

GST Council — Article 279A

The GST Council is a constitutional body created by the Constitution (One Hundred and First Amendment) Act, 2016. Its membership is drawn from the Union and State governments: the Union Finance Minister chairs it; the Union Minister of State in charge of Revenue or Finance is a member; and each State government nominates a minister in charge of finance, taxation or another minister. The Constitution provides for the members referred to in the State category to choose a Vice-Chairperson from among themselves.

The Council makes recommendations on GST-related matters listed in Article 279A, including taxes, goods and services to be covered or exempted, model laws, principles of levy, place of supply, threshold limits and rates. The Constitution prescribes a weighted voting arrangement: the Union has one-third of the total votes cast, while all States together have two-thirds; a decision requires at least three-fourths of weighted votes of members present and voting. The quorum is one-half of the total number of members. The Council is a forum for cooperative federalism, but constitutional interpretation and the legal effect of its recommendations must be stated carefully. In Union of India v. Mohit Minerals Pvt. Ltd. (2022), the Supreme Court explained that GST Council recommendations have persuasive value in the constitutional scheme and are not, simply by themselves, binding commands on Parliament and State Legislatures. A recommendation and a law enacted by a competent legislature are different legal acts.

7. Federalism in Andhra Pradesh: how to frame an answer

AP-specific questions are strongest when tied to a constitutional principle rather than a floating political claim.

• Police and public order: Primarily State List matters. The Union may still act within its own constitutional competence and applicable laws; avoid describing all security-related activity as exclusively one government’s domain.
• Education: A Concurrent List subject. National frameworks and State implementation can operate together, subject to the constitutional allocation and valid laws.
• Local government: Panchayats and municipalities are constitutionally recognised; State laws and institutions shape their detailed operation. Local-body finance connects the State Finance Commission to Article 280’s responsibilities.
• GST: AP participates through its State government’s representation in the GST Council. Council recommendations, legislation and administrative implementation are related but distinct stages.
• Inter-State river issues: Article 262 is the constitutional enabling provision; the applicable Parliamentary law and tribunal or judicial framework must be identified before stating a specific dispute’s current status.

When asked “Is India federal or unitary?”, avoid a one-word answer. India has a federal distribution of powers, elected governments at Union and State levels, and an independent constitutional judiciary. It also has strong Union features and specified emergency or coordination routes. A sound answer identifies the concrete constitutional provision and facts involved.

8. Common traps and active recall

Trap 1: “State List means Parliament can never legislate.” Incorrect. Articles 249, 250, 252 and 253, among other routes, create defined exceptions.

Trap 2: “Any State-Centre conflict is Article 254 repugnancy.” Incorrect. Article 254 principally addresses inconsistency between Parliamentary and State laws on Concurrent List matters.

Trap 3: “Finance Commission determines every State’s budget.” Incorrect. It makes constitutional recommendations on specified matters; State budgets are made through their own constitutional processes.

Trap 4: “GST Council votes like one State, one vote.” Incorrect. Article 279A sets weighted voting: one-third for the Union and two-thirds for the States together.

Trap 5: “Inter-State Council is a court.” Incorrect. It is a coordination and discussion mechanism under Article 263.

Recall grid

Worked application and retrieval drill

Worked case: a State subject with national implications

A question concerns a matter ordinarily listed in the State List but describes a national emergency, international obligation or request from several States. The first step is still to identify the subject and the applicable list. Then ask whether the Constitution supplies a special Parliamentary route—such as the specified resolutions or circumstances in Articles 249, 250, 252 or 253. Do not state the broad rule “State List means Parliament can never legislate.” Do not infer from a national interest label that any route is automatically satisfied; the relevant constitutional trigger and procedure must be met.

Financial federalism also has multiple actors. The Finance Commission under Article 280, GST Council under Article 279A and Inter-State Council under Article 263 have different constitutional roles. The GST Council is not a court and the Finance Commission does not decide every dispute between governments. In Union of India v. Mohit Minerals (2022), the Supreme Court explained the legal significance of GST Council recommendations within the constitutional framework. A recommendation, an enacted statute and an executive implementation order are separate stages.

Retrieval drill

Create a “subject → route → actor → legal effect” table for five examples: police/public order, education, GST, inter-State river water and an international treaty obligation. Record the ordinary list entry, then add only a special route supported by the constitutional text. The method rewards exactness rather than slogans about centralisation or State autonomy.

Examiner distinction and source drill

Articles 249, 250, 252 and 253 create distinct routes involving State List subjects. Their triggers differ: a Rajya Sabha resolution, a Proclamation of Emergency, State requests, or implementation of international obligations. The route matters because the same policy area can be addressed under different legal authority. Do not write that Parliament can always legislate on any State subject, and do not write that it never can. The Constitution allocates competence and provides defined exceptions. Financial institutions also need precision: the Finance Commission recommends under Article 280; the GST Council makes recommendations in the GST framework under Article 279A; the Inter-State Council supports specified coordination under Article 263. A question about recommendation is not necessarily a question about enacted law.

Integrated problem-solving workshop

Scenario: Parliament legislates on a State List subject

A multiple-choice question says Parliament enacted a law concerning a State List subject. One option claims the law is always invalid; another says Parliamentary power is unlimited. Both are overbroad. Ask which constitutional route is invoked. Article 249 uses a Rajya Sabha resolution under its terms. Article 250 concerns the emergency route. Article 252 allows Parliamentary legislation on a State List matter at the request of two or more States, with the constitutional effect for participating States. Article 253 concerns implementing international obligations. The exact trigger and procedure decide whether a route is available.

Financial relations need similar separation. The Finance Commission makes recommendations under Article 280; the GST Council functions under Article 279A; the Inter-State Council under Article 263 has coordination functions. These bodies do not have identical membership, subject matter or legal effect. A recommendation does not equal an enacted statute. In a GST question, distinguish the Council’s constitutional role from legislative authority of Parliament and State Legislatures. In a river-water question, check Article 262 and applicable legislation rather than assuming Article 263 is the dispute rule.

Answer check

For each route, complete “trigger / actor / legal consequence.” If any cell is blank, return to the Constitution. Do not infer an exceptional Parliamentary power from a broad political phrase such as “national importance.”

Practice MCQs — original, explained

1. Which statement best describes the Concurrent List?

• A. Both Parliament and State Legislatures may legislate, subject to constitutional rules including Article 254.
• B. Only Parliament may legislate on every entry.
• C. Only State Legislatures may legislate on every entry.
• D. Courts make the laws whenever a subject is concurrent.

Answer: A. The list allocates legislative competence to both levels. Article 254 supplies a rule for a repugnancy between Parliamentary and State laws on a Concurrent List matter. It does not transfer ordinary law-making to courts.

2. A Rajya Sabha resolution under Article 249 concerns which route?

• A. The Supreme Court making a State budget.
• B. Parliament legislating on a specified State List matter in the national interest.
• C. A Governor appointing a Finance Commission.
• D. A State Legislature dissolving the Lok Sabha.

Answer: B. Article 249 allows Parliament to legislate on a specified State List matter after the prescribed Rajya Sabha resolution declaring it necessary or expedient in the national interest.

3. Article 252 is most closely associated with:

• A. A State unilaterally repealing a Parliamentary law enacted under Article 252.
• B. The President certifying every Money Bill.
• C. Parliament legislating for two or more States that request it by resolutions.
• D. The Supreme Court appointing a State Council of Ministers.

Answer: C. States can request Parliamentary legislation on a State List matter. Other States may later adopt the law. Amendment or repeal for participating States is by Parliament under Article 252.

4. Article 254(2) may permit a State law to prevail in that State over an earlier Parliamentary law on a Concurrent List matter when the State law:

• A. is passed by a local body.
• B. is approved by the Inter-State Council alone.
• C. is notified by the Supreme Court Registry.
• D. is reserved for the President and receives the President’s assent.

Answer: D. Article 254(2) provides this route, subject to its terms. Parliament retains power under the proviso to later add to, amend, vary or repeal the State law.

5. Which Article provides for the Union Finance Commission?

• A. Article 280 — Finance Commission
• B. Article 279A — Inter-State Council
• C. Article 262 — State Finance Commission
• D. Article 263 — Finance Commission

Answer: A. Article 280 provides for the Union Finance Commission. Article 263 concerns an Inter-State Council, Article 279A the GST Council, and Article 262 inter-State water disputes.

6. Which is a principal function of the Union Finance Commission under Article 280?

• A. To conduct Lok Sabha elections.
• B. To recommend distribution of shareable tax proceeds and principles for grants-in-aid.
• C. To allocate the State List among States.
• D. To adjudicate all disputes between two States.

Answer: B. The Commission recommends tax distribution and grants-in-aid, among other functions stated in Article 280. It is not an election authority or a general inter-State court.

7. The GST Council’s weighted voting arrangement gives:

• A. equal weight to each district.
• B. all voting power to the Union Finance Minister.
• C. one-third weight to the Union and two-thirds collectively to the States.
• D. one vote to every elected representative in India.

Answer: C. Article 279A provides the one-third/two-thirds weighting and requires at least three-fourths of weighted votes of members present and voting for a decision.

8. Which statement about the Inter-State Council is correct?

• A. It replaces every constitutional court.
• B. It is the same institution as the GST Council.
• C. It automatically strikes down State laws.
• D. Article 263 enables its establishment for coordination and discussion.

Answer: D. Article 263 permits establishment of a Council for specified coordination, investigation and discussion functions. It is distinct from the GST Council and the courts.

9. Which constitutional provision enables Parliament to provide by law for adjudication of inter-State river-water disputes?

• A. Article 262
• B. Article 368
• C. Article 14
• D. Article 32

Answer: A. Article 262 is the constitutional provision concerning adjudication of disputes relating to the use, distribution or control of inter-State river waters. The statutory framework must also be checked.

10. “Police” and “public order” are commonly treated as:

• A. Union List entries.
• B. State List subjects.
• C. exclusively judicial subjects.
• D. entries in the Twelfth Schedule only.

Answer: B. They are State List subjects. Related national laws may still arise under other constitutional entries or special routes, so avoid overbroad claims of exclusivity over every connected issue.

11. Which statement about residuary legislative power is correct?

• A. It is exercised by the Election Commission.
• B. It applies only to village panchayats.
• C. It is assigned to Parliament under Article 248 and Union List Entry 97.
• D. It belongs automatically to every State.

Answer: C. Residuary matters not enumerated in the State or Concurrent Lists are allocated to Parliament, subject to the constitutional text.

12. Which statement best distinguishes a Finance Commission from a GST Council?

• A. They are two names for the same body.
• B. Both are courts with final criminal jurisdiction.
• C. Article 280 Council conducts elections and Article 279A Commission audits accounts.
• D. Article 280 Finance Commission recommends fiscal distribution and grants; Article 279A GST Council makes recommendations on GST matters.

Answer: D. They are distinct constitutional bodies with different Articles, membership, functions and subject areas. Neither is a court.

Chapter 13 answer key at a glance

1-C · 2-A · 3-A · 4-B · 5-B · 6-B · 7-A · 8-A · 9-C · 10-B · 11-A · 12-B

Sources and edition note

Primary text: Constitution of India, Legislative Department consolidated edition dated 1 May 2026, especially Articles 245–255, 256–263, 268–281, 279A and the Seventh Schedule. The official Finance Commission constitutional-provisions page was used to verify Articles 280–281; the official GST Council page was used to verify its constitutional basis, composition and functions. Union of India v. Mohit Minerals Pvt. Ltd., (2022) 10 SCC 700, is noted for the legal status of GST Council recommendations. Constitutional law may be amended and judicial interpretation may evolve; re-check the official consolidated text and controlling judgments before a later edition.