Actual Article
Article 273: Grants in lieu of export duty on jute and jute products
- There shall be charged on the Consolidated Fund of India in each year as grants-in-aid of the revenues of the States of Assam, Bihar, Odisha, and West Bengal such sums as Parliament may by law provide to be in lieu of the assignment of the whole or any part of the net proceeds of the export duty on jute and jute products to those States.
- The sums so charged shall be fixed sums, and shall be in addition to the share of the net proceeds of any other duty or tax which may be assigned to any of those States under this Constitution.
- The sums so fixed shall continue to be charged on the Consolidated Fund of India so long as any export duty on jute and jute products continues to be levied by the Government of India, and the net proceeds thereof are not assigned to any State.
UPSC Notes for Article 273
Explanation:
- Grants-in-Aid: Article 273 mandates that certain sums be charged on the Consolidated Fund of India each year as grants-in-aid to the revenues of Assam, Bihar, Odisha, and West Bengal. These grants are provided in lieu of the assignment of export duty proceeds on jute and jute products.
- Fixed Sums: The grants are fixed sums and are in addition to any other revenue shares from duties or taxes assigned to these States.
- Continuation of Grants: These grants will continue as long as the export duty on jute and jute products is levied and the proceeds are not assigned to any State.
Key Points:
- Compensatory Grants: The article ensures that the affected States receive compensatory grants due to the export duties on jute and jute products being collected by the Union.
- Financial Support: This provision offers financial support to specific States, recognizing the economic impact of export duties on their revenues.
- Legislative Role: Parliament determines the specific sums provided as grants-in-aid, ensuring legislative oversight and flexibility in the amounts allocated.
Important Cases and Commissions Related to Article 273
Cases:
- No specific landmark cases directly interpreting Article 273, as it primarily deals with financial grants and legislative provisions.
Commissions:
- Finance Commission: Reviews and recommends measures regarding grants-in-aid and financial allocations to States, including those covered under Article 273.
- National Jute Policy: Various policies and commissions related to jute production and export may indirectly impact the grants provided under Article 273.
Important Reports Related to Article 273:
- Finance Commission Reports: Provide detailed analysis and recommendations on the allocation of grants-in-aid, including those related to the export duty on jute and jute products.
- Reports on Jute Industry: Discuss the economic impact of jute production and export duties on the States of Assam, Bihar, Odisha, and West Bengal.
Previous Year Prelims Questions Related to Article 273
- (UPSC Prelims 2016) Which States are entitled to grants-in-aid under Article 273?
- A. Punjab, Haryana, Rajasthan, and Gujarat
- B. Assam, Bihar, Odisha, and West Bengal
- C. Maharashtra, Karnataka, Tamil Nadu, and Kerala
- D. Uttar Pradesh, Madhya Pradesh, Chhattisgarh, and Jharkhand Correct Answer: B. Assam, Bihar, Odisha, and West Bengal
- (UPSC Prelims 2018) The grants-in-aid provided under Article 273 are in lieu of what?
- A. Export duty on jute and jute products
- B. Income tax
- C. Sales tax
- D. Property tax Correct Answer: A. Export duty on jute and jute products
Previous Year Mains Questions Related to Article 273
- Mains 2016: “Discuss the significance of Article 273 in providing financial support to States. How do the grants-in-aid under this article impact the revenues of Assam, Bihar, Odisha, and West Bengal?”
- Mains 2019: “Evaluate the role of Parliament in determining grants-in-aid under Article 273. What are the implications of these grants for fiscal federalism and state finances?”
Additional Insights:
- Economic Impact on States: Article 273 acknowledges the economic impact of export duties on specific States and provides compensatory financial support to mitigate this impact.
- Legislative Flexibility: The provision allows Parliament to adjust the grants-in-aid as necessary, ensuring that the financial needs of the affected States are met appropriately.
Understanding Article 273 is crucial for UPSC aspirants as it provides insights into the mechanisms for providing financial support to specific States affected by export duties, emphasizing the importance of compensatory grants and fiscal federalism. This knowledge is essential for both preliminary and main examinations, offering a comprehensive understanding of the financial provisions and grant mechanisms within the Indian Constitution.