Chapter XII FINANCE COMMISSION

The Finance Commission constituted under article 243-1 shall review the financial position of Municipalities.

Powers and functions of the Finance Commission.—

1. (1) The Finance Commission shall make recommendations to the Governor as to-
   • (a) the principles which should govern-
     • (i) the distribution between the State and the Municipalities of the net proceeds of the taxes, duties, tolls and fees leviable by the State, which may be divided between them and the allocation between the Municipalities of their respective shares of such proceeds;
     • (ii) the determination of taxes, duties, tolls and fees which may be assigned to, or appropriated, by the Municipalities;
     • (iii) the grant-in-aid to the Municipalities from the Consolidated Fund of the State;
   • (b) the measures needed to improve the financial position of the Municipalities;
   • (c) any other matter referred to the Finance Commission by the Governor in the interests of sound finance of the Municipalities.
2. (2) The Governor shall cause every recommendation made by the Commission under subsection (1) together with an explanatory memorandum as to the action taken thereon to be laid before the Legislative Assembly.