What Happened
- Tamil Nadu Chief Minister M.K. Stalin disseminated Part I of a report by the High-Level Committee on Union-State Relations, chaired by retired Supreme Court Justice Kurian Joseph.
- The committee was constituted in April 2025; other members include retired IAS officer K. Ashok Vardhan Shetty and former Vice Chairman of the Tamil Nadu Planning Commission M. Naganathan.
- The report advocates sweeping constitutional, fiscal, and institutional reforms to rebalance Union-State relations — including potential constitutional amendments for structural reset of federalism.
- The report advances eleven arguments (seven pro-decentralisation, four debunking "centralisation fallacies") and addresses issues including territorial integrity of states, the role of Governors, delimitation, and fiscal autonomy.
- Stalin stated that the Centre has failed to deliver through centralisation and that States must have their autonomy restored; he called for the Centre to stay focused on national responsibilities.
Static Topic Bridges
Constitutional Framework of Centre-State Relations — The Three Lists
The Indian Constitution distributes legislative powers between the Union and States through the Seventh Schedule (Articles 245-248). The Union List (List I) contains 97 subjects on which only Parliament can legislate; the State List (List II) has 66 subjects for state legislatures; and the Concurrent List (List III) has 47 subjects where both can legislate, with Union law prevailing in case of conflict (Article 254).
- Article 245: Parliament makes laws for the whole of India; state legislatures for their states
- Article 246: Distribution of legislative subjects via the Seventh Schedule
- Article 248: Residuary powers vest with Parliament (unlike the US, where residuary powers are with states)
- Article 249: Parliament can legislate on State List subjects if the Rajya Sabha passes a resolution by 2/3rd majority in the national interest
- Article 252: Parliament can legislate for two or more states if those states consent (e.g., the original Police Act 1861 method)
- Article 254(2): A state law on a Concurrent List subject that is repugnant to Union law can still have effect if it receives Presidential assent
- Seventh Schedule subjects that are state subjects but contested: land, forests, police, water, education (moved to Concurrent in 1976 by the 42nd Amendment), health
Connection to this news: The report's focus on "centralisation" reflects long-standing state grievances about Parliament encroaching on State List subjects, the 42nd Amendment's shift of several subjects to the Concurrent List, and the operational use of Union authority in day-to-day governance.
Fiscal Federalism — Finance Commission and the Devolution Debate
India's fiscal federalism is governed by the Finance Commission (Article 280), which recommends the distribution of net tax proceeds between the Union and States. States receive a share of the "divisible pool" (central taxes excluding cesses and surcharges). A persistent state grievance is the growing proportion of central revenues raised through cesses and surcharges, which are NOT shared with states.
- Article 280: President constitutes Finance Commission every five years; recommends vertical devolution (Centre-States split) and horizontal distribution (among states)
- 15th Finance Commission (2020-25): recommended 41% of divisible pool to states (down from 42% recommended by 14th FC — 1% deducted for newly formed UTs of J&K and Ladakh)
- 16th Finance Commission: constituted under Dr. Arvind Panagariya; currently deliberating; will cover 2026-31
- Cesses and surcharges: constitute ~20% of gross tax revenue; not shared with states — a major fiscal federalism grievance
- GST compensation ended in 2022 — states lost a revenue guarantee they had during GST rollout (2017-22)
- Centrally Sponsored Schemes (CSS): Centre imposes conditions on how state funds are spent — reduces state fiscal autonomy
Connection to this news: The report's focus on fiscal autonomy aligns with long-standing demands that cesses be rationalised, CSS funds be untied, and states receive greater share of the divisible pool — key recommendations also made by earlier commissions.
Sarkaria and Punchhi Commissions — Historical Context for Union-State Reform
Two major previous exercises have examined Union-State relations. The Sarkaria Commission (1983, chaired by Justice R.S. Sarkaria of the Supreme Court) submitted its report in 1988 with 247 recommendations on legislative, administrative, and financial relations. Key recommendations included restraint in using Article 356 (President's Rule), establishing a permanent Inter-State Council, and reducing the misuse of the Governor's office. The Punchhi Commission (2007, chaired by former CJI M.M. Punchhi) submitted its report in 2010 with 273 recommendations, addressing 21st-century issues like terrorism, Governor's role, and the need to make the Inter-State Council a constitutional body.
- Sarkaria Commission (1983-1988): 247 recommendations; called for sparing use of Article 356; recommended permanent Inter-State Council; most recommendations not implemented
- Inter-State Council: established 1990 (Article 263) following Sarkaria recommendations; functions as an advisory body; meets infrequently
- Punchhi Commission (2007-2010): 273 recommendations; expanded Sarkaria's framework; proposed "localised emergency" instead of full Article 356 deployment
- Article 356 misuse: invoked 125+ times since 1950; Supreme Court curtailed it in S.R. Bommai v. Union of India (1994) — held it subject to judicial review; floor test mandatory
- Justice Kurian Joseph Committee (Tamil Nadu, 2025): follows in the tradition of state-level exercises on federalism (similar exercises by Rajasthan and West Bengal in earlier periods)
Connection to this news: The Kurian Joseph report is part of a long tradition of periodic demands for federalism reform. Its constitutional amendment proposals go beyond previous committee recommendations — signalling a more assertive phase in the Centre-State relations debate.
Article 356 and Governor's Role — Key Flashpoints
Article 356 allows the President (on the Governor's report or otherwise) to proclaim President's Rule in a state if the state government cannot be carried on in accordance with the Constitution. The Governor, appointed by the President on the advice of the Council of Ministers, is often at the centre of Centre-State tensions regarding reservation of state bills, summoning/dismissal of state assemblies, and imposition of President's Rule.
- Article 156: Governor holds office during the pleasure of the President — no fixed term security
- Article 163: Governor acts on the aid and advice of the Council of Ministers in most matters, but has discretionary powers in specified areas
- Article 200: Governor can reserve bills for Presidential consideration — a key flashpoint (Tamil Nadu and Kerala have had sustained disputes over bill reservation)
- Article 356: President's Rule — must be approved by Parliament within 2 months; renewed every 6 months; cannot continue beyond 3 years without a constitutional amendment
- S.R. Bommai v. Union of India (1994): Article 356 subject to judicial review; floor test must be held before dismissing a government; proclamation must be based on objective material
Connection to this news: Stalin's report specifically flags the Governor's role and territorial integrity as areas requiring reform — reflecting ongoing disputes between the Tamil Nadu government and the Raj Bhavan over bill assent and policy obstructions.
Key Facts & Data
- Justice Kurian Joseph Committee constituted: April 2025 by the Tamil Nadu government
- Report structure: Part I released; full report expected within two years
- Constitutional articles at issue: Article 245-248 (legislative distribution), Article 280 (Finance Commission), Article 356 (President's Rule), Article 163 (Governor's discretion)
- Sarkaria Commission: est. 1983, report 1988, 247 recommendations
- Punchhi Commission: est. 2007, report 2010, 273 recommendations
- 15th Finance Commission: 41% devolution of divisible pool to states
- Cesses and surcharges: ~20% of gross central tax revenue — not shared with states
- S.R. Bommai v. Union of India (1994): landmark Supreme Court ruling limiting misuse of Article 356