Question

Which authority recommends the principles governing the grants-in-aid of the revenues of the states out of the Consolidated Fund of India?

• A. Public Accounts Committee
• B. Union Ministry of Finance
• C. Finance Commission
• D. Inter State Council

Hint:

Remember: Finance Commission = Article 280 = Revenue sharing + Grants-in-aid recommendations.

Answer 1

The Correct Option is C

Step 1: Article 280 of the Indian Constitution provides for the Finance Commission.
Step 2: The Finance Commission recommends how the Union government should distribute tax revenues between the Centre and the States.
Step 3: It also lays down the principles governing grants-in-aid from the Consolidated Fund of India to the states in need of financial assistance. \[ \boxed{\text{Finance Commission}} \]

Answer 2

Checking each body's constitutional role against the specific function of recommending grants-in-aid narrows this down.

1. Option 1 (Public Accounts Committee): This parliamentary committee examines government expenditure and audit reports, not the distribution of grants-in-aid.
2. Option 2 (Union Ministry of Finance): The ministry implements fiscal policy but does not itself lay down the constitutional principles for grants-in-aid.
3. Option 3 (Finance Commission): Constituted under Article 280, this body is specifically tasked with recommending the principles governing grants-in-aid to states from the Consolidated Fund of India.
4. Option 4 (Inter State Council): This council deals with Centre-State coordination on policy matters generally, not the specific grants-in-aid recommendations.

The constitutional mandate under Article 280 places this responsibility with the Finance Commission, matching option 3.

Hence, the correct answer is Finance Commission.