constituent assembly of india debates (proceedings)- volume vii

higher technical education. Normally, however, apart from war or large scale internal disorder, the
expenditure of the Centre should be comparatively stable. The needs of the Provinces are in contrast,
almost unlimited, particularly in relation to welfare services and general development. If these services,
on which the improvement of human well-being and increase of the country's productive capacity so
much depend, are to be properly planned and executed, it is necessary to place at the disposal of
Provincial Governments adequate resources of their own, without their having to depend on the variable
munificence or affluence of the Centre. The Provinces must, therefore, have as many independent
sources of revenue as possible. On the other hand, it is not practicable to augment their revenues to any
considerable extent by adding more subjects to the Provincial Legislative List, without simultaneously upsetting
the equilibrium of the Centre. We cannot, therefore, avoid divided heads; and what we have to
aim at is to have only a few divided heads, well balanced and high-yielding, and to arrange that the
shares of the Centre and the Provinces in these heads are adjusted automatically without friction, or
mutual interference.
29. In this country the lack of sufficient economic and financial statistics and other similar data is a
great handicap. Therefore, the allocation of resources has to be made largely on the basis of a broad
judgment, at any rate until the necessary data become available. We attach great importance to the
collection of these statistics and to connected research, and trust that the Government will make the
necessary arrangements without delay. In the meantime we have made our recommendations on the
best judgment we could give to the exiguous data available.
List of taxes for the Centre and the Units
30. We recommend no major change in the list of taxes in the Federal Legislative List as
recommended by the Union Powers Committee. We however, recommended the substitution of the limit
of Rs. 250 for Rs. 50 in clause 200 of the Draft Constitution relating to taxes on professions, trades,
callings and employments. We observe from the Draft Constitution that it has been proposed to transfer
to the Federal Legislative List stamp duty on transfer of shares and debentures, but we presume that the
duties will continue to accrue to the Provinces. In view of the far-reaching effects on public credit and
finance of Stock Exchange transactions, we consider that the Centre should have the power to legislate
for the regulation of such transactions. If such regulation involves the levy of taxes, we recommend that
such taxes should be retained by the Centre except that if the taxes take the form of mere duties on
transfers of shares and debentures, the Provinces should have these duties just like other Stamp duties.
We accordingly recommend the entry in the Federal Legislative List of a new item "Stock Exchanges and
futures market and taxes other than Stamp duties on transactions in them".
31. In the list of taxes in the Provincial Legislative List, we recommend the following changes: -
(1) In entry 43, the words "hearths and windows" may be deleted. Such taxes are not likely to be
levied. In any case, they would be covered by the word "buildings".
(2) In entry 53, the word "cesses" should, we think, be replaced by the word "taxes".
(3) Similarly, in entry 56, we would substitute the word "taxes" for the word "dues".
(4) In entry 50, we would make the following changes: -
(a) for the word "sale", we would substitute "sale, turnover or purchase", in
order to avoid doubt.
(b) We would also add words such as "including taxes in lieu thereof on the