Budget bifurcation debate in Manipur Constitutional limits, Article 371C and the Hill Areas Committee
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Y Devendro Singh
Contd from previous issue
Among its most significant features is the requirement that before the Five-Year and Annual Plans of the State are finalised, proposals showing separately the schemes for the hill areas and the rest of the State must be placed before the Committee, whose views must be considered; the Govt must also furnish quarterly reports on plan implementation. This consultative framework ensures equitable developmental participation and integrates re- gional concerns into the State’s planning process, reflecting an intention of in- clusion rather than financial or administrative segregation. If, moreover, the term “bifurcation” is taken to imply that the State Budget should be divided into distinct functional components subject to different institutional controls—one opera- ting through the general administrative departments of the State and another functioning through mechanisms associated with the Hill Areas Committee—such an interpretation would be constitutionally unsustainable. It would create two parallel streams of financial authority within a single State, contrary to Article 266(1), which mandates the existence of only one Consoli- dated Fund for each State, fragmenting legislative authority over public finance, weakening the collective financial sovereignty of the Legislative Assembly, and disrupting the consultative balance intended by Article 371C. While the consultative framework established under Article 371C is of considerable Constitutional signi- ficance, it is not a fiscal authority and does not possess independent power to legislate upon, approve, or ad- minister public expenditure. Its role, as reflected in the relevant provisions of the 1972 Order, is deliberative and advisory, designed to secure informed examination of matters relating to the hill areas rather than to exercise executive or financial control.
A central element of this scheme is the deliberate use of the word “referred” in Paragraph 4(2) of the 1972 Order, which makes consultation with the Hill Areas Committee mandatory but does not confer any veto power. Had the provision instead employed the word “approval,” the Hill Areas Committee would effectively have been trans- formed into a parallel legislature, thereby undermining the sovereignty of the Assembly. Understanding this distinction is essential for appreciating the purpose and limits of the safeguard. The experience of the Committee demonstrates both its potential and its fragility: no Bill affecting subjects such as land, forests, customary practices, or local administration can lawfully bypass its scrutiny, yet the mechanism has at times been treated as symbolic or subjected to po- litical pressures, diminishing its institutional effec- tiveness. While constitutional privileges under Articles 194(2) and 212 protect the internal proceedings of the Legislature and its committees, privilege without corresponding responsibility risks reducing this Constitutional design to mere formality, underscoring the need for faithful and informed implementation of the consultative mandate.
The scheme of Article 371C makes clear that it mandates consultation without bifurcation: the Hill Areas Committee must be fully consulted during the preparation of development plans, and the Govt must furnish quarterly implementation reports rela- ting to the hill areas; however, these consultative powers operate strictly within the unity of a single State Budget and cannot be expanded into a claim of dual budgetary authority. Proper constitutional application requires transparent reflection of allocations for the hill districts within the Annual Financial Statement and meaningful engagement with the Committee before finalising development proposals. This unified model of budgeting with participatory consultation preserves both fiscal integrity and regional inclusion and aligns with the broader constitutional duty imposed under Section 5(b) of the 1972 Order, which requires the Committee to promote unity between hill and valley areas by ensuring integrated and evenly based economic growth and augmenting the resources of the State as a whole. Intended to safeguard hill interests while advancing the State’s collective development as a single political and economic unit, this mandate transforms the Committee into a constitutional bridge that fosters balanced development, mutual enrichment, and cohesion rather than regional segregation. Consequently, any proposal implying territorial or functional dualism in bud- geting—even when framed as a “two-component” internal division—directly con- tradicts Articles 266(1) and 202–207 and misreads Article 371C, which seeks participation, not parallelism, and integration, not fragmentation; justice for the hill areas lies in inclusive development within the unified fiscal authority of the Legislative Assembly, not in financial separation.
This Constitutional logic is reinforced by the structure of the Manipur Le- gislative Assembly (HAC) Order, 1972, which limits the Committee’s jurisdiction to matters formally referred by the Govt, the Governor, or the Legislative Assembly under Sections 4, 5, and 6. Section 4(2) requires that every Bill (other than a Money Bill) affecting the hill areas and dealing with Scheduled matters be referred to the Committee, with the Governor’s decision on whether referral is required being final, while Section 6 requires that Five-Year and Annual Plan proposals be placed before the Committee and that quarterly implementation reports be furnished. Within this framework, the Committee is a deliberative and advisory body whose authority depends entirely on proper referral; it may acknowledge external co- mmunications but cannot act upon them independently. Any attempt to consider budget-bifurcation proposals without formal referral is ultra vires, inconsistent with Articles 208 and 209 governing legislative procedure, and contrary to Article 371C’s integrative purpose. Fiscal matters, including Money Bills, remain exclusively within the authority of the full Legislative Assembly under Articles 202–207, and Article 266(1) prohibits any division of financial authority by requiring a single Consolidated Fund for each State. Public, civic, or academic proposals under Article 19 (1)(a) must therefore avoid creating mis- understanding or encouraging territorial segmentation of Constitutional processes; interpretive contributions must remain grounded in Constitutional text and structure, as speculative readings that imply ungranted powers risk distor- ting Constitutional intent. Upholding the Constitution requires reaffir- ming that while consultation is mandatory, bifurcation is imper- missible: the unity of the State Budget is preserved even as regional participation is strengthened through a Constitutionally coherent consultative mechanism.
The functioning of the Hill Areas Committee is governed not only by the Presidential Order of 1972 but also by the Rules of Procedure of the Manipur Legislative Assembly framed under Article 208, particularly Chapter XX (Rules 218–232), which sets out its constitution, powers, sittings, quorum, sub-committees, reporting proce- dures, and internal regulation; Rule 231 allows the Committee to regulate its own procedure, while Rule 232 exempts it from the rules applicable to other committees, reinforcing its distinct constitutional status under Article 371C. The exclusion of Money Bills from its jurisdiction is essential to preserving Cons- titutional balance by preventing regional fragmentation of financial authority and safeguarding the Legislature’s collective control over the Consolidated Fund, a balance further maintained through the Governor’s special responsibility under Article 371C. Within this structure, Manipur’s budgeting system demonstrates that financial unity and regional representation are complementary principles: the Committee introduces structured consultation into development planning for the hill areas without compromising the singular authority of the Legislature over public finance, thereby transforming budgeting into a participatory democratic process while preserving a unified fiscal framework. The deeper philosophy of Article 371C is to reconcile diversity with unity by democratising decision- making rather than dividing fiscal authority, ensuring that the hill areas possess an assured voice in legislative and developmental affairs through consultation, participation, and deliberation. Embedded within India’s model of cooperative federalism, the consultative mechanism institutionalises regional perspectives in law-making and development planning, converting potential tensions into opportunities for collabo- ration, and affirming that inclusiveness in governance requires engagement within one constitutional system. At its core, both the Budget and the consultative scheme under Article 371C reflect accountability through representation, and any interpretation treating Article 371C as a basis for fiscal segregation would disregard its true purpose; applied faithfully, it strengthens unity through participatory governance within a single, coherent order.
In conclusion, the Union and State Budgets are not merely financial exercises but symbols of legislative sovereignty and democratic accountability. Within this framework, Article 371C operates as a Constitutional bridge between unity and diversity by ensuring that the interests of the hill areas are addressed through consultation rather than separation. The HAC embodies cooperative federa- lism by institutionalising representation without fragmentation and consultation without division, while the unity of the State Budget under Article 266—reinforced by the consultative mandate of Article 371C—safeguards fiscal integrity and advances participatory governance. Together, these provisions affirm that inclusiveness is achieved through dialogue, structured consultation, and accountability, transforming diversity into cohesion within a single constitutional and financial order.
The proper functioning of the Hill Areas Committee is a shared responsibility of multiple constitutional actors: the Governor must ensure referral of matters under Section 4, provide necessary documents, secure compliance with Sec- tions 5 and 6, and submit periodic reports under Article 371C(2) and Section 9; the Legislative Assembly must ensure referral of Bills under Section 4(2), facilitate meetings, table reports, and consider recommendations; and the Govt must supply all relevant information, development propo- sals, plan documents, and quarterly progress reports required under Section 6. These interconnected responsibilities constitute a shared constitutional trust that depends upon coordinated functioning—super- visory vigilance from the Governor, procedural discipline from the Legislature, and factual and administrative support from the Executive. When each institution performs its duties faithfully, the consultative mechanism operates as intended, strengthening equi- table development and legislative integration; when any component falters, the entire constitutional balance is weakened. The integrity of this framework therefore rests on continuous cooperation grounded in Cons- titutional responsibility rather than unilateral or isolated action.
Contd from previous issue
Among its most significant features is the requirement that before the Five-Year and Annual Plans of the State are finalised, proposals showing separately the schemes for the hill areas and the rest of the State must be placed before the Committee, whose views must be considered; the Govt must also furnish quarterly reports on plan implementation. This consultative framework ensures equitable developmental participation and integrates re- gional concerns into the State’s planning process, reflecting an intention of in- clusion rather than financial or administrative segregation. If, moreover, the term “bifurcation” is taken to imply that the State Budget should be divided into distinct functional components subject to different institutional controls—one opera- ting through the general administrative departments of the State and another functioning through mechanisms associated with the Hill Areas Committee—such an interpretation would be constitutionally unsustainable. It would create two parallel streams of financial authority within a single State, contrary to Article 266(1), which mandates the existence of only one Consoli- dated Fund for each State, fragmenting legislative authority over public finance, weakening the collective financial sovereignty of the Legislative Assembly, and disrupting the consultative balance intended by Article 371C. While the consultative framework established under Article 371C is of considerable Constitutional signi- ficance, it is not a fiscal authority and does not possess independent power to legislate upon, approve, or ad- minister public expenditure. Its role, as reflected in the relevant provisions of the 1972 Order, is deliberative and advisory, designed to secure informed examination of matters relating to the hill areas rather than to exercise executive or financial control.
A central element of this scheme is the deliberate use of the word “referred” in Paragraph 4(2) of the 1972 Order, which makes consultation with the Hill Areas Committee mandatory but does not confer any veto power. Had the provision instead employed the word “approval,” the Hill Areas Committee would effectively have been trans- formed into a parallel legislature, thereby undermining the sovereignty of the Assembly. Understanding this distinction is essential for appreciating the purpose and limits of the safeguard. The experience of the Committee demonstrates both its potential and its fragility: no Bill affecting subjects such as land, forests, customary practices, or local administration can lawfully bypass its scrutiny, yet the mechanism has at times been treated as symbolic or subjected to po- litical pressures, diminishing its institutional effec- tiveness. While constitutional privileges under Articles 194(2) and 212 protect the internal proceedings of the Legislature and its committees, privilege without corresponding responsibility risks reducing this Constitutional design to mere formality, underscoring the need for faithful and informed implementation of the consultative mandate.
The scheme of Article 371C makes clear that it mandates consultation without bifurcation: the Hill Areas Committee must be fully consulted during the preparation of development plans, and the Govt must furnish quarterly implementation reports rela- ting to the hill areas; however, these consultative powers operate strictly within the unity of a single State Budget and cannot be expanded into a claim of dual budgetary authority. Proper constitutional application requires transparent reflection of allocations for the hill districts within the Annual Financial Statement and meaningful engagement with the Committee before finalising development proposals. This unified model of budgeting with participatory consultation preserves both fiscal integrity and regional inclusion and aligns with the broader constitutional duty imposed under Section 5(b) of the 1972 Order, which requires the Committee to promote unity between hill and valley areas by ensuring integrated and evenly based economic growth and augmenting the resources of the State as a whole. Intended to safeguard hill interests while advancing the State’s collective development as a single political and economic unit, this mandate transforms the Committee into a constitutional bridge that fosters balanced development, mutual enrichment, and cohesion rather than regional segregation. Consequently, any proposal implying territorial or functional dualism in bud- geting—even when framed as a “two-component” internal division—directly con- tradicts Articles 266(1) and 202–207 and misreads Article 371C, which seeks participation, not parallelism, and integration, not fragmentation; justice for the hill areas lies in inclusive development within the unified fiscal authority of the Legislative Assembly, not in financial separation.
This Constitutional logic is reinforced by the structure of the Manipur Le- gislative Assembly (HAC) Order, 1972, which limits the Committee’s jurisdiction to matters formally referred by the Govt, the Governor, or the Legislative Assembly under Sections 4, 5, and 6. Section 4(2) requires that every Bill (other than a Money Bill) affecting the hill areas and dealing with Scheduled matters be referred to the Committee, with the Governor’s decision on whether referral is required being final, while Section 6 requires that Five-Year and Annual Plan proposals be placed before the Committee and that quarterly implementation reports be furnished. Within this framework, the Committee is a deliberative and advisory body whose authority depends entirely on proper referral; it may acknowledge external co- mmunications but cannot act upon them independently. Any attempt to consider budget-bifurcation proposals without formal referral is ultra vires, inconsistent with Articles 208 and 209 governing legislative procedure, and contrary to Article 371C’s integrative purpose. Fiscal matters, including Money Bills, remain exclusively within the authority of the full Legislative Assembly under Articles 202–207, and Article 266(1) prohibits any division of financial authority by requiring a single Consolidated Fund for each State. Public, civic, or academic proposals under Article 19 (1)(a) must therefore avoid creating mis- understanding or encouraging territorial segmentation of Constitutional processes; interpretive contributions must remain grounded in Constitutional text and structure, as speculative readings that imply ungranted powers risk distor- ting Constitutional intent. Upholding the Constitution requires reaffir- ming that while consultation is mandatory, bifurcation is imper- missible: the unity of the State Budget is preserved even as regional participation is strengthened through a Constitutionally coherent consultative mechanism.
The functioning of the Hill Areas Committee is governed not only by the Presidential Order of 1972 but also by the Rules of Procedure of the Manipur Legislative Assembly framed under Article 208, particularly Chapter XX (Rules 218–232), which sets out its constitution, powers, sittings, quorum, sub-committees, reporting proce- dures, and internal regulation; Rule 231 allows the Committee to regulate its own procedure, while Rule 232 exempts it from the rules applicable to other committees, reinforcing its distinct constitutional status under Article 371C. The exclusion of Money Bills from its jurisdiction is essential to preserving Cons- titutional balance by preventing regional fragmentation of financial authority and safeguarding the Legislature’s collective control over the Consolidated Fund, a balance further maintained through the Governor’s special responsibility under Article 371C. Within this structure, Manipur’s budgeting system demonstrates that financial unity and regional representation are complementary principles: the Committee introduces structured consultation into development planning for the hill areas without compromising the singular authority of the Legislature over public finance, thereby transforming budgeting into a participatory democratic process while preserving a unified fiscal framework. The deeper philosophy of Article 371C is to reconcile diversity with unity by democratising decision- making rather than dividing fiscal authority, ensuring that the hill areas possess an assured voice in legislative and developmental affairs through consultation, participation, and deliberation. Embedded within India’s model of cooperative federalism, the consultative mechanism institutionalises regional perspectives in law-making and development planning, converting potential tensions into opportunities for collabo- ration, and affirming that inclusiveness in governance requires engagement within one constitutional system. At its core, both the Budget and the consultative scheme under Article 371C reflect accountability through representation, and any interpretation treating Article 371C as a basis for fiscal segregation would disregard its true purpose; applied faithfully, it strengthens unity through participatory governance within a single, coherent order.
In conclusion, the Union and State Budgets are not merely financial exercises but symbols of legislative sovereignty and democratic accountability. Within this framework, Article 371C operates as a Constitutional bridge between unity and diversity by ensuring that the interests of the hill areas are addressed through consultation rather than separation. The HAC embodies cooperative federa- lism by institutionalising representation without fragmentation and consultation without division, while the unity of the State Budget under Article 266—reinforced by the consultative mandate of Article 371C—safeguards fiscal integrity and advances participatory governance. Together, these provisions affirm that inclusiveness is achieved through dialogue, structured consultation, and accountability, transforming diversity into cohesion within a single constitutional and financial order.
The proper functioning of the Hill Areas Committee is a shared responsibility of multiple constitutional actors: the Governor must ensure referral of matters under Section 4, provide necessary documents, secure compliance with Sec- tions 5 and 6, and submit periodic reports under Article 371C(2) and Section 9; the Legislative Assembly must ensure referral of Bills under Section 4(2), facilitate meetings, table reports, and consider recommendations; and the Govt must supply all relevant information, development propo- sals, plan documents, and quarterly progress reports required under Section 6. These interconnected responsibilities constitute a shared constitutional trust that depends upon coordinated functioning—super- visory vigilance from the Governor, procedural discipline from the Legislature, and factual and administrative support from the Executive. When each institution performs its duties faithfully, the consultative mechanism operates as intended, strengthening equi- table development and legislative integration; when any component falters, the entire constitutional balance is weakened. The integrity of this framework therefore rests on continuous cooperation grounded in Cons- titutional responsibility rather than unilateral or isolated action.