Subject: Polity
Financial relations form a critical pillar of India's federal structure. Articles 268 to 293, along with the establishment of the Finance Commission, provide the framework for revenue sharing between the Centre and the States. These provisions help address fiscal imbalances and ensure that states have adequate resources to fulfill their responsibilities, while also allowing the Centre to maintain a degree of financial control necessary for national cohesion.
The Finance Commission, as mandated by the Constitution, periodically recommends the distribution of taxes and grants-in-aid. Moreover, the residuary powers granted to Parliament under Article 248 further consolidate the Centre's financial authority on subjects not explicitly mentioned in the legislative lists.
Judicial pronouncements have consistently underscored the need for a balanced fiscal approach that empowers states to address local developmental needs while supporting national economic policies.