Article 274 of the Costitution of India with Case law
📘 Article 274 of the Constitution of India – Prior recommendation of President required to Bills affecting taxation in which States are interested
🔹 Text of Article 274:
(1) No Bill or amendment which imposes or varies any tax or duty in which States are interested, or affects the distribution of such taxes between the Union and the States, shall be introduced or moved in either House of Parliament except on the recommendation of the President.
(2) No Bill or amendment which imposes a surcharge on the tax or duty referred to in Article 271 shall be introduced or moved in either House of Parliament except on the President’s recommendation.
🧾 Explanation:
This Article ensures that Parliament cannot unilaterally legislate on certain financial matters that directly impact States, unless the President gives prior approval.
This provision safeguards federal financial interests.
It applies to:
Taxes where States have a share (e.g., income tax, excise duties),
Bills that change tax-sharing formulas,
Any Bill imposing surcharges on shared taxes.
⚖️ Important Case Laws on Article 274:
🔹 **1. State of West Bengal v. Union of India, AIR 1963 SC 1241
(Though not directly on Art. 274, it emphasizes legislative competence)**
Held: Parliament cannot override State powers arbitrarily.
Article 274 reaffirms this principle by requiring Presidential consent before encroaching on State-related taxation matters.
🔹 2. Union of India v. H.S. Dhillon, (1972) 2 SCC 779
Dealt with Parliament’s powers to impose wealth tax on agricultural land.
While this focused on legislative competence, it indirectly confirmed that in matters where States have fiscal interest, additional safeguards like Article 274 apply.
🔹 3. K.C. Gajapati Narayan Deo v. State of Orissa, AIR 1953 SC 375
This early constitutional case laid down that recommendation of the President is a mandatory constitutional requirement in cases like those covered by Article 274.
Absence of such recommendation renders the Bill invalid or unconstitutional.
🔹 4. Shrilekha Vidyarthi v. State of U.P., (1991) 1 SCC 212
Although unrelated directly to Article 274, it reinforced the idea that State rights in fiscal federalism must be respected and cannot be bypassed by executive or legislative overreach.
📝 Key Points to Remember:
| Aspect | Details |
|---|---|
| Purpose | To protect States’ financial interests in Union legislation |
| Applies To | Taxes in which States have a share, or distribution of revenue |
| Power Restricted | Parliament cannot introduce Bills on these matters without President’s recommendation |
| Article Type | Mandatory procedural safeguard |
| Related Articles | Article 270 (distribution of taxes), Article 271 (surcharge), Article 110 (Money Bills) |
📊 Summary Table:
| Condition | Is Presidential Recommendation Required? |
|---|---|
| Tax where states are interested | ✅ Yes |
| Change in revenue-sharing formula | ✅ Yes |
| Surcharge under Article 271 | ✅ Yes |
| GST matters (post-101st Amendment) | ✅ Usually via GST Council, not Article 274 directly |
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