Finance Commission

✅Article 280 of the constitution of India provides for a Finance Commission as a 

quasi-judicial body. 

✅ It constituted by the president of India every fifth year or at such earlier time 

as he considers necessary. 

✅Finance Commission consists of a chairman and four other members to be 

appointed by the president.

 

✅ Function of the commission is to make recomendations to the president of India on following matters .

 

1. The distribution of the net proceeds of taxes to be shared between the centre and the states and the allocation between the states of the respective shares of such proceeds. 

2. The principles that should govern the grants-in-aid to the states by Centre.

 

3. The measures needed to augment the consolidated fund of of the panchayats and the municipalities in the state on the basis of the recommendations made by 

the state finance commission.

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