74th Amendment

1. Constitutional purpose and coverage

Before the amendment, municipalities existed under state laws but often faced supersession, irregular elections, weak revenues and extensive state control. The 74th Amendment sought to give them constitutional continuity and enable them to function as institutions of self-government. It complemented the 73rd Amendment on Panchayats, but created a separate urban framework. Local government remains primarily a State List subject under Entry 5, subject to the constitutional requirements introduced by these amendments.

Part IXA defines the institutional framework, while the Twelfth Schedule identifies potential areas of municipal responsibility. Article 243W authorises state legislatures to endow municipalities with powers necessary for self-government, including preparation of plans for economic development and social justice. It does not automatically or exclusively assign all 18 functions to every municipality. Consequently, the depth of urban decentralisation varies significantly between states.

Article 243ZB applies Part IXA to Union Territories, subject to presidential modifications. Under Article 243ZC, it does not ordinarily apply to Scheduled Areas under Article 244(1) or tribal areas under Article 244(2); Parliament may extend it with exceptions and modifications. Article 243ZF permitted inconsistent pre-existing municipal laws to continue for up to one year after commencement, unless amended or repealed earlier.

2. Municipal categories, representation and participation

Article 243Q provides for a Nagar Panchayat for an area transitioning from rural to urban, a Municipal Council for a smaller urban area and a Municipal Corporation for a larger urban area. The Governor specifies these areas through public notification, considering population, population density, locally generated revenue, non-agricultural employment, economic importance and other factors. The Constitution does not prescribe uniform national population cut-offs for these three categories.

An important exception concerns industrial townships. A municipality need not be constituted where the Governor specifies an industrial township after considering the area's size and municipal services provided or proposed by an industrial establishment. This is not an automatic exemption for every industrial area.

Under Article 243R, municipal seats are filled through direct election from territorial constituencies called wards. State law may provide representation for persons with special knowledge or experience in municipal administration, specified legislators and certain committee chairpersons. However, nominated experts cannot vote in municipal meetings. The method of choosing the municipal chairperson is determined by state law; the Constitution does not mandate a directly elected mayor.

Article 243S requires Ward Committees within municipalities having a population of three lakh or more. Their territorial coverage, composition and manner of filling seats are determined by state law. States may also create additional committees. Thus, the constitutional obligation is to establish Ward Committees, not necessarily one committee for every individual ward.

3. Reservations, tenure and election safeguards

Article 243T reserves seats for Scheduled Castes and Scheduled Tribes broadly in proportion to their populations within the municipal area. At least one-third of these reserved seats must be reserved for women belonging to the respective communities. At least one-third of all directly elected municipal seats, including those reserved for SC/ST women, must be reserved for women. States may provide a higher share.

Offices of municipal chairpersons must be reserved for SCs, STs and women in the manner prescribed by state law. The Constitution does not specify a one-third quota for women chairpersons in Article 243T. States may also reserve seats and chairperson offices for backward classes. In Vikas Kishanrao Gawali v. State of Maharashtra, 2021, the Supreme Court required a triple test for OBC political reservation: a dedicated commission, local-body-wise assessment of reservation requirements and compliance with the aggregate 50 per cent ceiling for SC/ST/OBC reservations.

Article 243U fixes a municipality's normal duration at five years from its first meeting. Elections must be completed before expiry or, following dissolution, within six months. If the remaining term is less than six months, an election for that short remainder is unnecessary. A reconstituted municipality serves only the unexpired portion of the dissolved body's term. A municipality must receive a reasonable opportunity of being heard before dissolution.

Under Articles 243ZA and 243K, the State Election Commission controls electoral rolls and municipal elections. Article 243V permits a person aged 21 or above to contest, notwithstanding a higher minimum age for state legislative membership. Article 243ZG bars judicial challenges to delimitation laws and seat allotment made under Article 243ZA; municipal elections can be challenged only through election petitions as provided by state law.

4. Functions, finance and integrated planning

The Twelfth Schedule covers urban planning, land-use regulation, roads and bridges, water supply, sanitation, solid-waste management, fire services, environmental protection, slum improvement and urban poverty alleviation, among other matters. It also includes birth and death registration, public amenities and regulation of slaughterhouses and tanneries. Several functions overlap operationally with state departments or specialised agencies, making clear activity mapping important.

Article 243X enables state legislatures to authorise municipal taxes, duties, tolls and fees; assign state revenues; provide grants; and constitute municipal funds. It does not itself confer an unrestricted taxing power. Under Article 243Y, the State Finance Commission constituted under Article 243I reviews municipal finances and recommends revenue sharing, assigned taxes, grants and measures for financial improvement. Its recommendations and an explanatory memorandum on action taken must be placed before the state legislature.

Article 243ZD requires a District Planning Committee to consolidate Panchayat and municipal plans into a draft district development plan. At least four-fifths of its members must be elected by and from elected district-level Panchayat members and municipal members, in proportion to the district's rural and urban populations.

Article 243ZE provides for a Metropolitan Planning Committee in every metropolitan area. At least two-thirds of its members must be elected by and from elected municipal members and Panchayat chairpersons in that area, reflecting the population ratio. A metropolitan area has at least ten lakh people, comprises one or more districts, contains two or more municipalities, Panchayats or other contiguous areas, and is specified by the Governor.

5. Achievements, implementation gaps and reform priorities

The amendment created a durable constitutional basis for elected urban government and expanded political representation, especially for women and historically disadvantaged communities. Nevertheless, elected councils frequently share authority with state-appointed commissioners, development authorities, water boards and transport agencies. Responsibility for urban outcomes can therefore exceed a municipality's actual control over staff, infrastructure or finances.

The Second Administrative Reforms Commission's Sixth Report, Local Governance, emphasised subsidiarity, stronger local capacity and clearer accountability. Effective reform requires transfer of functions, funds and functionaries together; predictable fiscal transfers; stronger property-tax and user-charge administration; professional municipal staffing; and meaningful Ward Committees. For Prelims, distinguish constitutionally mandatory safeguards from matters left to state law. Constitutional status alone does not establish complete fiscal or administrative autonomy.

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