Part XII: Finance, Property, Contracts and Suits

Article 290: Adjustment in Respect of Certain Expenses and Pensions

Original Article:

Where the expenses of any court, commission, or pension payable to individuals are charged on the Consolidated Fund of India or a State, appropriate financial adjustments must be made:

• If the charge is on the Consolidated Fund of India but serves a State, the State shall contribute proportionally.
• If the charge is on the Consolidated Fund of a State but serves the Union or another State, appropriate contributions shall be made by the benefiting entities.

In case of disputes, an arbitrator appointed by the Chief Justice of India will determine the contribution amount.

Explanations:

Article 290 ensures equitable financial responsibility between the Union and States for expenses and pensions that serve multiple jurisdictions. This provision highlights cooperative federalism in India's governance framework.

Key Provisions:

Clause 1: Shared Responsibility for Expenses

The Union and States share financial responsibilities when expenses benefit multiple jurisdictions, ensuring fairness in governance costs.

• Examples include shared expenses for commissions investigating inter-state disputes.

Clause 2: Pension Contributions

Pensions payable to individuals serving both Union and State governments are subject to proportional financial contributions from both entities.

• This ensures that no single entity bears the entire financial burden for services benefiting multiple jurisdictions.

Clause 3: Arbitration Mechanism

In case of disputes over financial contributions, an arbitrator appointed by the Chief Justice of India determines the appropriate amounts.

• This mechanism ensures impartial resolution and fosters cooperation between the Union and States.

Real-Life Examples:

When the expenses of a judicial commission investigating inter-state river disputes are charged to the Consolidated Fund of India, the benefiting states contribute proportionally under Article 290.

Amendments:

Article 290 has remained unchanged, reflecting its enduring relevance in managing financial adjustments between the Union and States.

Historical Significance:

Article 290 represents the Constitution's emphasis on equitable financial arrangements in a federal system. It acknowledges the interdependence of Union and State governments in serving the public.

Debates and Deliberations:

During the Constituent Assembly debates, Dr. B.R. Ambedkar highlighted the need for a mechanism to allocate financial responsibilities fairly. Members debated the scope of arbitration and the role of the Chief Justice in resolving disputes.

• Shri P.T. Chacko emphasized the importance of protecting state finances from disproportionate burdens.
• Shri H.V. Kamath proposed an independent tribunal instead of an arbitrator, but the Assembly favored the latter for efficiency.

References:

• Constitution of India: Detailed provisions on Article 290.
• Judicial Commission Reports: Examples of financial adjustments under Article 290.
• Constituent Assembly Debates: Discussions on equitable financial management.