During 18th Century

  • On 12 August 1765
    • As the out come of the Battle of Buxar of 23 October 1764, Mughal emperor appointed the East India Company as the Diwan of Bengal to recover the loss during the war
      • Dewans
        • Head of a state institution.
        • belonged to the elite families in the history of Mughal and post-Mughal India and held high posts within the government


    • Robert Clive signed two important treaties in Allahabad, one with the Nawab of Awadh and the other with the Mughal Emperor, Shah Alam II
    • Based on the terms of the Treaty of Allahabad agreement,  Mughal Emperor Shah Alam II granted the East India Company, Robert Clive, of the East India Company, Diwani rights, or the right to collect taxes on behalf of the Emperor from the eastern province of Bengal-Bihar-Orissa


    • Robert Clive established the dual system of government in Bengal
      • The Rule of Two
        • the Company and the Nawab
        • Under which both the
          • diwani, i.e., revenue collection,
          • nizamat, i.e., police and judicial functions, came under the control of the Company
        • As the diwan, the Company exercised diwani rights and nizamat rights through its right to nominate the deputy subahdar.
        • The Diwani (Fiscal) was carried out by the company so Company was Diwan
        • Nizamat (territorial) jurisdiction was carried out by these decrepit Indians so they were Nizam
        • However, the real authority was East India Company in the Nizamat also.
        • This was the beginning of the Economic loot from India, which made England the wealthiest country in the world in the 19th and 20th century
    • Diwan the Company took two decisions
      • it abolished the village land record office and created a company official called Patwari who became the official record keeper for a number of villages
      • creation of the office of magistrate and the abolition of village police. The magistrate carried out policing functions through the Darogha who had always been a state functionary under the


  • In 1772, Warren Hastings began his tenure as Governor of Bengal
        • splitting the courts into Diwani Adalats (civil courts), and Faujdari Adalats (criminal courts).
        • Indian officials as heads of the Faujdari Adalats, putting a faujdar (judge) and diwan (chief public officer) in charge of each, he placed the Company’s provincial councils as heads of the Diwani Adalats
    • These Diwani rights allowed the company to collect revenue directly from the people of Bengal, Bihar, and Orissa.
    • In return, the East India Company paid an annual tribute of twenty-six lakhs of rupees (equal to 260,000 pounds sterling) while securing for Shah Alam II the districts of Kada and Allahabad.
    • The tribute money paid to the Mughal emperor was for the maintenance of the Emperor’s court in Allahabad.
    • The alliance signed by Emperor and Company by which the company promised to support the Nawab against outside attacks provided he paid for services of the troops sent to his aid, is turning point in Indian history


  • Because of Diwan, Panchayat was destroyed by the East India Company 


During 19th Century

  • From 1870 that Viceroy Lord Mayo‘s Resolution gave the needed impetus to the development of local institutions
    • A significant impetus to the development of local governments was given by Mayo’s resolution of 1870
    • It afforded opportunities for the development of self government to harness social interest, supervision and care for the management of funds devoted to education sanitation and health services, local pulic works
    • It was out of fiscal compulsion that Lord Mayo’s resolution on local self governemnt came to be adopted
    • It was in the wake of this resolution onthat the first significant step to revive the traditional village panchyat system in benagal was taken in 1870 through the bengal chowkidari act
    • This enactment empowered district magistrates to set up panchyats of nominated members in the villages
    • This nominated panchayats could levy and collect taxes to pay for the chowkidars or watchmen engaged by them

18 May 1882 – Lord Ripon Resolution

  • Took the initiative in the establishment of popularly elected institutions at local levels to looks after specific functions in their areas
  • Government policy on decentralization can be attributed to Lord Ripon, viceroy of india
  • Lord Ripon famous resolution on local self-government on 18 May 1882, recognized the twin considerations of local government:
    • Administrative efficiency
    • Political education
  • Resolution proposed establishment of local boards, two third of whose membership was composed of elected representatives
  • Focused on towns, provided for local bodies consisting of a large majority of elected non-official members and presided over by a non-official chairperson.
  • But this resolution met with resistance from colonial administrators.
  • The progress of local self-government was tardy with only half hearted steps taken in setting up municipal bodies.
  • But the term self government had began to gain curency

===================================================================================During 20th Century

In 1906, Congress accepted the Self government as the political goal for the cournty


The Royal Commission on Decentralization (1907)

  • Govt constituted the Royal Commission on Decentralization which elaborated further the principles enuciated in Lord Ripon’s resolution and recognized the importance of self govnt in the indian context
  • First ever reference of village panchyat as local self govt institutions was made in the report of this commision
  • The Committee’s function was to prepare memoranda for the Royal Commission on Decentralization in India.
  • Most of the memoranda are the annotated copies of C. E. H.Hobhouse, chairman of the Royal Commission
  • He recognized the importance of panchayats at the village level
  • It recommended that “it is most desirable, alike in the interests of decentralization and in order to associate the people with the local tasks of administration, that an attempt should be made to constitute and develop village panchayats for the administration of local village affairs

The Morly-Minto reforms of 1909

  • The report of Royal Commission on Decentralization (1907)  result into Morly-Minto reforms of 1909
  • Led to the enlargement of elective process in the local self gvernemtn structure of india
  • commission viewed local self government should start from village level instead of district level
  • The recommendattions of the commission recognized the importance of Village panchyats
  • In 1909, INC at Lahore session passed a resolution and urged the Govt of india to make early steps to make all local boaides from village pancayats upwards elective with elected non-official chiarmen and to support adequeste financial aid


Bala Gangadhar Tilk was concious that local govt in the real sense of the term was not possible till swaraj was obtained

Gandiji declared, viallges panchyats should be now a living force in a special way and india would almost enjoying self govt suited to its requirements


Govt Act 1919

The Montague-Chemsford reforms (1919)

  • Brought local self-government as a provincial transferred subject, under the domain of Indian ministers in the provinces
  • Most significant development
    • establishment of village panchayats in a number of provinces, that were no longer mere ad hoc judicial tribunal, but representative institutions symbolizing the corporate character of the village and having a wide jurisdiction in respect of civic matters

By 1925, Eight provinces had passed panchayat acts

By 1926, six native states had also passed panchayat laws.


The provincial autonomy under the Government of India Act, 1935

  • Marked the evolution of panchayats in India
  • Popularly elected governments in provinces enacted legislations to further democratize institutions of local self-government.
  • But the system of responsible government at the grassroots level was least responsible
  • D.P Mishra, the then minister for local self-government under the Government of India Act of 1935 in Central Provinces was of the view that
    • ‘the working of our local bodies. in our province and perhaps in the whole country presents a tragic picture.


the Royal Commission on Decentralization (1907)
the report of Montague and Chemsford on constitutional reform (1919)
the Government of India Resolution (1919)


The Indian National Congress from the 1920s to 1947

  • Emphasized the issue of all-India Swaraj, and organized movements for Independence under the leadership of Mahatma Gandhi.
  • The task of preparing any sort of blueprint for the local level was neglected as a result.
  • Gandhi favoured Village Swaraj and strengthening the village panchayat to the fullest extent
  • Dr. B.R Ambedkar opposed this idea. He believed that the village represented regressive India, a source of oppression


PRI’s During the drafting of the Constitution of India

  • PRIs were placed in the non-justiciable part of the Constitution, the Directive Principles of State Policy, as Article 40.
  • The Article 40 read
    • ‘the State shall take steps to organise village panchayats and endow them with such powers and authority as may be necessary to enable them to function as units of self-government’.
    • However, no worthwhile legislation was enacted either at the national or state level to implement it


PRI’s in Four Decades  since the adoption of the Constitution

  • Panchayat raj institutions have traveled from the non-justiciable part of the Constitution to one where, through a separate amendment, a whole new status has been added to their history.

Panchayat raj had to go through various stages

  • The First Five Year Plan
    • Failed to bring about active participation and involvement of the people in the Plan processes, which included Plan formulation implementation and monitoring


  • The Second Five Year Plan
    • Attempted to cover the entire countryside with National Extensive Service Blocks through the institutions of Block Development Officers, Assistant Development Officers, Village Level Workers, in addition to nominated representatives of village panchayats of that area and some other popular organisations like co-operative societies.
    • But the plan failed to satisfactorily accomplish decentralisation.

Hence, committees were constituted by various authorities to advise the Centre on different aspects of decentralization


In 1957, Balwant Rai Mehta Committee studied the Community Development Projects and the National Extension Service and assessed the extent to which the movement had succeeded in utilizing local initiatives and in creating institutions to ensure continuity in the process of improving economic and social conditions in rural areas. 


The Committee held that community development would only be deep and enduring when the community was involved in the planning, decision-making and implementation process. 

The suggestions were for as follows:

  1. An early establishment of elected local bodies and devolution to them of necessary resources, power and authority
  2. That the basic unit of democratic decentralisation was at the block or samiti level since the area of jurisdiction of the local body should neither be too large nor too small. The block was large enough for efficiency and economy of administration, and small enough for sustaining a sense of involvement in the citizens.
  3. Such body must not be constrained by too much control by the government or government agencies.
  4. The body must be constituted for five years by indirect elections from the village panchayats.
  5. Its functions should cover the development of agriculture in all its aspects, the promotion of local industries and others
  6. Services such as drinking water, road building, etc., and
  7. The higher level body, Zilla Parishad, would play an advisory role



The PRI structure did not develop the requisite democratic momentum and failed to cater to the needs of rural development.

There are various reasons for such an outcome which include

  • Political and bureaucratic resistance at the state level to share power and resources with local level institutions,
  • Domination of local elites over the major share of the benefits of welfare schemes,
  • Lack of capability at the local level
  • Lack of political will










73rd Constitutional Amendment :

  • The idea which produced the 73rd Amendment was not a response to pressure from the grassroots, but to an increasing recognition that the institutional initiatives of the preceding decade had not delivered, that the extent of rural poverty was still much too large and thus the existing structure of government needed to be reformed.
  • It is interesting to note that this idea evolved from the Centre and the state governments.
  • It was a political drive to see PRIs as a solution to the governmental crises that India was experiencing.


  • The Constitutional (73rd Amendment) Act, passed in 1992 by the Narasimha Rao government, came into force on April 24, 1993.
  • It was meant to provide constitutional sanction to establish “democracy at the grassroots level as it is at the state level or national level”.

Its main features are as follows:

1.The Gram Sabha or village assembly as a deliberative body to decentralised governance has been envisaged as the foundation of the Panchayati Raj System.73rd Amendment of the Constitution empowered
the Gram Sabhas to conduct social audits in addition to its other functions.

2. A uniform three-tier structure of panchayats at village (Gram Panchayat -GP), intermediate or block (Panchayat Samiti – PS) and district (Zilla Parishad – ZP) levels.

3. All the seats in a panchayat at every level are to be filled by elections from respective territorial constituencies.

4. Not less than one-third of the total seats for membership as well as office of chairpersons of each tier have to be reserved for women.

5. Reservation for weaker castes and tribes (SCs and STs) have to be provided at all levels in proportion to their population in the panchayats.

6. To supervise, direct and control the regular and smooth elections to panchayats, a State Election Commission has The Act has ensured constitution of a State Finance Commission in every State/UT, for every five years, to suggest measures to strengthen finances of panchayati raj institutions.

7. To promote bottom-up-planning, the District Planning Committee (DPC) in every district has been accorded to constitutional status.

8. An indicative list of 29 items has been given in the Eleventh Schedule of the Constitution. Panchayats are expected to play an effective role in planning and implementation of works related to these 29 items


5 January 1966 – first ARC was constituted by the Ministry of Home Affairs under Government of India


The Second ARC was set up with a resolution no. K-11022/9/2004-RC of the Government of India as a committee of inquiry to prepare a detailed blueprint for revamping the public administration system.

The Commission was given the mandate to suggest measures to achieve a proactive, responsive, accountable, sustainable and efficient administration for the country at all levels of the government. 

The Commission was asked to, inter alia, consider the following.

1) Organisational structure of the Government of India.

2) Ethics in Governance.

3) Refurbishing of Personnel Administration.

4) Strengthening of Financial Management Systems.

5) Steps to ensure effective administration at the State Level.

6) Steps to ensure effective District Administration.

7) Local Self-Government / Panchayati Raj Institutions.

8) Social Capital, Trust and Participative public service delivery

9) Citizen-centric administration.

10) Promoting e-governance.

11) Issues of Federal Polity.

12) Crisis Management.

13) Public Order.

The Commission was to exclude from its purview the detailed examination of administration of defence, railways, external affairs, security and intelligence, as also subjects such as Centre-state relations, judicial reforms etc. which were already being examined by other bodies. 

The Commission was, however, be free to take the problems of these sectors into account in recommending re-organisation of the machinery of the Government or of any of its service agencies.

The Commission will devise its own procedures (including for consultations with the State Government as may be considered appropriate by the Commission), and may appoint committees, consultants/advisers to assist it. 

The Commission may take into account the existing material and reports available on the subject and consider building upon the same rather than attempting to address all the issues ab initio. The Ministries and Departments of the Government of India were to furnish such information and documents and provide other assistance as may be required by the Commission. 


The Government of India entrusted the State Governments and all others concerned to extend their fullest cooperation and assistance to the Commission. 

The commission has presented the following 15 Reports to the Government for consideration:

1) Right to Information – Master Key to Good Governance (09.06.2006)

2) Unlocking Human Capital – Entitlements and Governance-a Case Study (31.07.2006)

3) Crisis Management – From Despair to Hope (31.10.2006).

4) Ethics in Governance (12.02.2007).

5) Public Order – Justice for each peace for all. (25.06.2007)

6) Local Governance-1, Local Governance-2, Local Governance-3 (27.11.2007)

7) Capacity Building for Conflict Resolution – Friction to Fusion (17.3.2008)

8) Combating Terrorism (17.9.2008)

9) Social Capital – A Shared Destiny (8.10.2008)

10) Refurbishing of Personnel Administration – Scaling New Heights (27.11.2008).

11) Promoting e-Governance – The Smart Way Forward (20.01.2009).

12) Citizen Centric Administration – The Heart of Governance (30.3.2009).

13) Organisational Structure of Government of India (19.5.2009).

14) Strengthening Financial Management Systems (26.5.2009).

15) State and District Administration (29.5.2009).


Group of Ministers (GoM)  30 March 2007 

  • The Government constituted a Group of Ministers (GoM) on 30 March 2007
  • the Chairmanship of the then External Affairs Minister to consider the recommendations of the Second ARC and to review the pace of implementation of the recommendations as well as to provide guidance to the concerned Ministries or Departments 


21 August 2009

  • It has since been reconstituted under the Chairmanship of Union Finance Minister on 21 August 2009.
  • Core Group on Administrative Reforms under the Chairmanship of Cabinet Secretary has finished examination of all the 15 reports.

This Group of Ministers has so far considered eleven reports:

  1. Right to Information: Master Key to Good Governance (First report)
  2. Unlocking human capital: Entitlements and Governance – A Case Study Relating to NREGA (Second Report)
  1. Crisis Management From Despair to Hope (Third report)
  2. Ethics in Governance (Fourth Report)
  3. Public order (Fifth Report)
  4. Local Governance (Sixth Report)
  5. Capacity Building for Conflict Resolution (Seventh Report)
  6. Combating Terrorism Protecting by Righteousness (Eight Report)
  7. Social Capital-A Shared Destiny (Ninth Report)
  8. Refurbishing of Personal Administration-Scaling new Heights (Tenth Report)
  9. Promoting e-governance: The smart way Forward (Eleventh Report)
  10. Citizen Centric Administration-The Heart of Governance (Twelfth Report)
  11. Organisational Structure of Government of India (Thirteenth Report)
  12. Strengthening Financial management System (Fourteenth Report)
  13. State and District Administration (Fifteenth Report)


The decisions of GoM on these reports are at various stages of implementation. 

The report on “Combating Terrorism (Eighth Report)” has been handled by the Ministry of Home Affairs and it is understood that necessary action has already been taken on this report. 

Thus, in all 12 Reports have been considered, so far. 

Remaining three reports (Report No.V, X, and XIV ) are also shortly being put up for consideration of GoM. 


3 December 2009

  • The Cabinet in its meeting held on 3 December 2009 had taken note of the progress of action taken in respect of second report (Unlocking human capital) relating to NREGA
  • In its meeting held on 29 December 2009 has taken note of the progress of action taken in respect of the first report (Right to Information) and third report (Crisis Management).

The self-government in India, since 1992 has been formalized under the panchayat raj system (rule by village committee) a three-tier system with elected bodies at the village, taluk and district levels. 

The modern system is based in part on traditional panchayat governance, in part on the vision of Mahatma Gandhi and in part by the work of various committees to harmonize the highly centralized Indian governmental administration with a degree of local autonomy. 

The result was intended to create greater participation in local government by people and more effective implementation of rural development programmes. 


Although, as of 2015, implementation in all of India is not complete the intention is for there to be a Gram Panchayat for each village or group of villages, a Tahsil level council, and a Zilla Panchayat at the district level

India has a chequered history of Panchayati Raj starting from the selfsufficient and self-governing village communities that endured the rise and fall of empires in the past, to the current highly structured system.

At present, there are about 3 million elected representatives at all levels of the panchayat 1/2th of which are women. These members represent more than 2.4 lakhs (240,000) Gram Panchayats, about 6,000 intermediate level tiers and more than 500 District Panchayats. 

Spread over the length and breadth of the country, the new Panchayats cover about 96 per cent of India’s more than 5.8 lakhs (580,000) villages and nearly 99.6 per cent of rural population. 

This is the largest experiment in decentralisation of governance in the history of humanity.


The Constitution visualizes Panchayats as institutions of self-governance. 

  • However, giving due consideration to the federal structure of India’s polity, most of the financial powers and authorities to be endowed on panchayats have been left at the discretion of concerned state legislatures.
  • Consequently, the powers and functions vested in PRIs vary from state to state. 
  • These provisions combine representative and direct democracy into a synergy and are expected to result in an extension and deepening of democracy in India. 
  • Hence, panchayats have journeyed from an institution within the culture of India to attain constitutional status.


  • This is one of the biggest democracy in the world where village level democratic structures are functioning for their development

Functions :

All municipal acts in India provide for functions, powers and responsibilities to be carried out by the municipal government.

These are divided into two categories – obligatory or discretionary.

1) Supply of pure and wholesome water.

2) Construction and maintenance of public streets.

3) Lighting and watering of public streets.

4) Cleaning of public streets, places and sewers.

5) Regulation of offensive, dangerous or obnoxious trades and callings or practices.

6) Maintenance or support of public hospitals.

7) Establishment and maintenance of primary schools.

8) Registration of births and deaths.

9) Removing obstructions and projections in public streets, bridges and other places.

10) Naming streets and numbering houses.

11) Laying out of areas.

12) Securing or removal of dangerous buildings or places.

13) Construction and maintenance of public parks, gardens, libraries, museums, rest houses, leper homes, orphanages and rescue homes for women.

14) Public buildings.

15) Planting and maintenance of roadside and other trees.

16) Housing for low income groups.

17) Conducting surveys.

18) Organizing public receptions, public exhibitions, public entertainment.

19) Provision of transport facilities with the municipality.

20) Promotion of welfare of municipal employees.


Some of the functions of the urban bodies overlap with the work of state agencies.

The functions of the municipality, including those listed in the Twelfth Schedule are left to the discretion of the state government. 

Local bodies have to be bestowed with adequate powers, authority and responsibility to perform the functions entrusted to them by the Act.

However, the Act has not provided them with any powers directly and has instead left it to state government discretion.


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