constituent assembly of india debates (proceedings)- volume vii

to be brought into effect when the Constitution comes into force; and
whether the same or a similar Commission should review these principles
and their concrete application periodically, say, once in five years?
II. What should be the principles on which Federal grants should be made to the Units in future?
What should be the machinery for the determination of such grants: could the same Financial
Commission as is referred to in I (d) above act as the machinery for this purpose also, or should it be a
different one?
III. How could the Indian States be fitted into this general system as far as possible on the same
terms as Provinces? Should a time lag be provided for their being so fitted in?
IV. On the assumption of financial responsibility for Defence, Foreign Affairs and Communications on
behalf of the Indian States under arrangements for accession to the Federation, what special financial
arrangements, if any, are necessary between the acceding States and the Federation?
V. Should the existing rights of the Indian States as to Federal taxes now levied by them be acquired
on payment of compensation?
VI. How far is it feasible, on the centralization of all customs levied at the Federal frontiers, to permit
Indian States affected by such centralization to retain such portion of the customs so levied at their
frontiers as might be attriments between the Centre and certain important Indian States as regards
maritime customs, excises etc. may be of value in this connection.]*
VII. Some Provinces have claimed a larger percentage of the income-tax to be made over to them
than under the existing system. Does this claim merit consideration; if so ,to what extent?
VIII. A suggestion has been made that the Centre should be allocated only the excises on specified
commodities, the rest of the field of excise being left to the Provinces to tap according to their needs.
Would this be possible without any material detriment to Federal revenue?
IX. On the basis that the residuary powers are vested in the Centre in the new Constitution so far as
the Provinces are concerned, and in the States so far as the States are concerned, is it necessary that
any additional specific taxes should be entered in the Provincial List, and if so, what?
X. Is it necessary to make any modifications in the existing provisions as regards procedure in
financial matters contained in Sections 33 to 37 and 78 to 83 of the Government of India Act, 1935?
XI. A large number of Indian States at present derive substantial revenues from land customs levied
at the frontiers between their limits and those of neigh bouring States or Provinces. One of the
fundamental rights already adopted by the Constituent Assembly is to remove all internal barriers in
regard to trade between Unit and Unit. Could these land customs be done away with either immediately
or over a period of years, and if so, should any prejudice caused thereby to the finances of particular
States be compensated and in what manner?
*[The Committee should kindly indicate clearly which of its recommendations should go into the body
of the Constitution and which should be provided for by Federal law.]*
Prefatory Remarks
2. We began our work on the 17th November and have been sitting continuously. We have received