What is Article 354 of Indian Constitution – Defination & Meaning

Article 354: Application of provisions relating to distribution of revenues while a Proclamation of Emergency is in operation. (1) The President may, while a
📅 Part XVIII – Emergency Provisions
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Article Number

354

part

Part XVIII – Emergency Provisions

Status

Active

Bare Acts Text

Article 354: Application of provisions relating to distribution of revenues while a Proclamation of Emergency is in operation.

  • (1) The President may, while a Proclamation of Emergency is in operation, by order direct that all or any of the provisions of articles 268 to 279 shall for such period, not extending in any case beyond the expiration of the financial year in which such Proclamation ceases to operate, as may be specified in the order, have effect subject to such exceptions or modifications as he thinks fit.
  • (2) Every order made under clause (1) shall, as soon as may be after it is made, be laid before each House of Parliament.
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Full Definition & Explanation

Article 354 of the Indian Constitution deals with the distribution of revenues during a Proclamation of Emergency. This article allows the President of India to issue an order that can modify the provisions of Articles 268 to 279. These articles primarily relate to the distribution of taxes and revenues between the states and the central government. The President can make these modifications for a limited time, which cannot extend beyond the financial year in which the emergency is declared. This means that during an emergency, financial governance can change to respond to the crisis effectively. The President’s authority under Article 354 primarily affects the financial relationship between the central and state governments. For instance, if a natural disaster or a national security threat occurs, the President can modify how revenues are shared to ensure that funds are adequately allocated to address the situation. This flexibility helps in managing resources more efficiently, saving time that would have been lost in legislative procedures. However, it is also necessary to note that any order made by the President must be laid before both Houses of Parliament. This ensures some level of accountability and oversight, even during emergencies. Also, the application of Article 354 is temporary and subject to parliamentary approval, which maintains the spirit of democracy. The need for such provisions arises from the understanding that emergencies can hinder normal financial operations. By allowing the President to act swiftly, the government can mobilize resources to support affected states or regions. This article thus serves as a safety net, providing the necessary legal framework for financial management during times of national crisis, ensuring that aid and resources reach the areas that need them most without unnecessary delays.

Historical Context

This article allows the President of India to issue an order that can modify the provisions of Articles 268 to 279. These articles primarily relate to the distribution of taxes and revenues between the states and the central government. The President can make these modifications for a limited time, which cannot extend beyond the financial year in which the emergency is declared. This means that during an emergency, financial governance can change to respond to the crisis effectively. Article 354 of the Indian Constitution deals with the distribution of revenues during a Proclamation of Emergency. The President’s authority under Article 354 primarily affects the financial relationship between the central and state governments.

Key Features

– The President can modify revenue distribution during an emergency.
– Changes can only last until the financial year ends.
– All orders must be presented to Parliament after being issued.
– It affects the financial relationship between Centre and states.
– The article ensures quick financial decision-making in crises.

Importance & Impact

– Enables quick financial adjustments during national emergencies
– Helps allocate resources effectively to affected regions
– Allows the government to respond rapidly to urgent financial needs.
– Ensures parliamentary oversight of emergency financial orders
– Maintains fiscal stability even in challenging circumstances

Sample UPSC Question

Consider the following statements regarding Article 354 of the Indian Constitution: A. It allows the President to modify tax distribution during an emergency. B. Changes made under this article can last indefinitely. C. Any order must be laid before Parliament. D. It primarily affects the financial powers of the judiciary. Which of the statements is/are correct? Analyze these options carefully in light of the constitutional distribution of legislative and executive powers.
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Answer

The correct answer is A and C. Article 354 allows the President to modify tax distribution during emergencies and mandates that any order be presented to Parliament for oversight. Article 354 of the Indian Constitution deals with the distribution of revenues during a Proclamation of Emergency.

Key Takeaways

✓ Article 354 allows emergency financial adjustments
✓ It ensures quick resource allocation during crises
✓ The President’s orders must be approved by Parliament.
✓ Changes cannot last beyond the financial year
✓ It impacts the financial dynamics between Centre and states.

FAQs

Article 354 of the Indian Constitution deals with the distribution of revenues during a Proclamation of Emergency. This article allows the President of India to issue an order that can modify the provisions of Articles 268 to 279. These articles primarily relate to the distribution of taxes and revenues between the states and the central government.

This flexibility helps in managing resources more efficiently, saving time that would have been lost in legislative procedures. However, it is also necessary to note that any order made by the President must be laid before both Houses of Parliament. This ensures some level of accountability and oversight, even during emergencies.

The need for such provisions arises from the understanding that emergencies can hinder normal financial operations. By allowing the President to act swiftly, the government can mobilize resources to support affected states or regions. This article thus serves as a safety net, providing the necessary legal framework for financial management during times of national crisis, ensuring that aid and resources reach the areas that need them most without unnecessary delays.

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Pramod is the Founder and Editor-in-Chief of StudyHub. He holds a Master's degree and is currently pursuing a Ph.D. in Geology, alongside more than 7+ years spent building and verifying competitive exam content for Indian aspirants. He leads StudyHub's editorial process across Indian Polity, the Constitution, Indian Economy, History, Geography, Science, and the platform's other subject areas — checking every article against primary sources (bare act text and Gazette notifications for constitutional topics, government and Economic Survey data for economy content, standard reference material elsewhere) and flagging it for re-verification whenever a relevant amendment, policy, or data update makes an earlier version outdated.
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