Finance Commission

• FINANCE COMMISSION (ART. 280)
• Established Year: 1951
• Article: 280
• Who appoints the finance Commission? President
• Finance Commission of India submits its report to? President 
•  What is the nature of Finance Commission? Advisory
• How is finance commission related with planning commission?
• The Finance Commission is a constitutional body while the Planning Commission is not statutory and merely an advisory body.
• In India the finance Commission is constituted for? 5 Years
• The role of the Finance Commission in Central-State fiscal relations has been undermined by? Ans: The State Governments
• The Finance Commission is primarily concerned with recommending to the president about?
• Ans: Finance Commission is a constitutional body and plays an important role in settling center state financial relations.

 So far 13 Finance Commissions have been appointed which are as follows:

Finance Commission	Year of Establishment	Chairman Operational	Duration
1	1951	K.C Neogy	1952-57
2	1956	K.Santhanam	1957-62
3	1960	A.K. Chanda	1962-66
4	1964	P.V. Rajamannarr	1966-69
5	1968	Mahaveer Tyagi	1969-74
6	1972	K. Brahmananda Reddy	1974-79
7	1977	J.M. Shellet	1979-84
8	1983	Y. B. Chavan	1984-89
9	1987	N.K.P. Salve	1989-95
10	1992	K.C Pant	1995-2000
11	1998	A.M.Khusro	2000-2005
12	2003	C.Rangarajan	2005-2010
13	2007	Vijay Kelkar	2010-2015

Functions

Functions of the Finance Commission can be explicitly stated as:

1.  Distribution of net proceeds of taxes between Centre and the States, to be divided as per their respective contributions to the taxes.
2.  Determine factors governing Grants-in Aid to the states and the magnitude of the same.
3. Work with the State Finance Commissions and suggest measures to augment the Consolidated Fund of the States so as to provide additional resources to Panchayats and Municipalities in the state.

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:

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

Disqualification from being a member of the Commission

A member may be disqualified if:

1. He is mentally unsound;
2. He is an undischarged insolvent;
3. He has been convicted of an immoral offence;
4. His financial and other interests are such that it hinders smooth functioning of the Commission.

Terms of Office of Members and eligibility for Reappointment

Every member will be in office for the time period as specified in the order of the President, but is eligible for reappointment provided he has, by means of a letter addressed to the President, resigned his office.

Salaries and Allowances of the members

The members of the Commission shall provide full- time or part- time service to the Commission, as the President specifies in his order. The members shall be paid Salaries and Allowances as per the provisions made by the Central Government. So far, 13 Finance commissions have submitted their recommendations. More or less, all of them have been accepted by the Union Government.