Article 243H of CoI : Article 243H: Powers to impose taxes by, and Funds of, the Panchayats.

Explanation using Example

Example 1:

Scenario: A village Panchayat in Maharashtra wants to improve the local infrastructure by constructing new roads and maintaining existing ones.

Application of Article 243H:

• Clause (a): The Maharashtra State Legislature passes a law authorizing the village Panchayat to levy a small road maintenance tax on all households in the village. The Panchayat collects this tax and uses the funds specifically for road construction and maintenance.
• Clause (b): The State Government assigns a portion of the vehicle registration fees collected in the district to the village Panchayat. This additional revenue helps the Panchayat fund larger infrastructure projects.
• Clause (c): The State Government provides a grant-in-aid from the Consolidated Fund of Maharashtra to the village Panchayat to support its road maintenance projects.
• Clause (d): The Panchayat sets up a dedicated Road Maintenance Fund where all the collected taxes, assigned fees, and grants are deposited. The Panchayat can withdraw money from this fund as needed for road-related expenses.

Example 2:

Scenario: A Panchayat in Kerala wants to improve the local water supply system to ensure clean drinking water for all resi...

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