Finance Commission of India - Banking Awareness for Bank Exams 2014

Finance Commission - Banking Awareness for Upcoming Bank Exams 2014

The government has constituted the 14th Finance Commission under the chairmanship of former RBI Governor YV Reddy. The commission will submit its report by October 31, 2014.

Finance Commission of India:
A finance commission is set up every five years by the President under Article 280 of the Constitution. Finance Commission of India came into existence in 1951.

It was formed to define the financial relations between the centre and the state. These recommendations cover a period of five years.

The commission also lays down rules by which the centre should provide grants-in-aid to states out of the Consolidated Fund of India. It is also required to suggest measures to augment the resources of states and ways to supplement the resources of panchayats and municipalities.

Composition of the Fourteenth Finance Commission:
The Fourteenth Finance Commission has been set up under the Chairmanship of Dr. Y.V.Reddy [Former Governor Reserve Bank of India].

Other Members of the Commission are:
i. Ms. Sushma Nath [ Former Union Finance Secretary ],
ii. Dr. M.Govinda Rao [ Director, National Institute for Public Finance and Policy, New Delhi ),
iii. Dr. Sudipto Mundle, Former Acting Chairman, National Statistical Commission.
iv. Prof Abhijit Sen (Member, Planning Commission) is the part-time Member of the Fourteenth Finance
v. Commission. Shri Shri Ajay Narayan Jha is the Secretary, Fourteenth Finance Commission.

Qualifications of the members: The Chairman of the Finance Commission is selected among people who have had the experience of public affairs. The other four other members are selected from people who:

1. Are, or have been, or are qualified, as judges of High Court, or
2. Have knowledge of Government finances or accounts, or
3. Have had experience in administration and financial expertise; or
4. Have special knowledge of economics

Procedure and Powers of the Commission: The Commission has the power determine their own procedure and:

1. Has all powers of the civil court as per the Court of Civil Procedure, 1908.
2. Can summon and enforce the attendance of any witness or ask any person to deliver information or produce a document, which it deems relevant.
3. Can ask for the production of any public record or document from any court or office.
4. Shall be deemed to be a civil court for purposes of Sections 480 and 482 of the Code of Criminal Procedure, 1898

Tenure of the 14th Finance Commission: The Finance Commission is required to give its report by 31st October, 2014. Its recommendations will cover the five year period commencing from 1st April, 2015.

Note: The First Finance Commission was constituted vide Presidential Order dated 22.11.1951 under the chairmanship of Shri K.C. Neogy on 6th April, 1952.