What is Article 360 of Indian Constitution – Defination & Meaning

Article 360: Provisions as to financial emergency (1) If the President is satisfied that a situation has arisen whereby the financial stability or credit of
📅 Part XVIII – Emergency Provisions
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Article Number

360

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Part XVIII – Emergency Provisions

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Bare Acts Text

Article 360: Provisions as to financial emergency

  • (1) If the President is satisfied that a situation has arisen whereby the financial stability or credit of India or of any part of the territory thereof is threatened, he may by a Proclamation make a declaration to that effect.
  • (2) A Proclamation issued under clause (1) —
    • (a) may be revoked or varied by a subsequent Proclamation;
    • (b) shall be laid before each House of Parliament;
    • (c) shall cease to operate at the expiration of two months, unless before the expiration of that period it has been approved by resolutions of both Houses of Parliament:
  • Provided that if any such Proclamation is issued at a time when the House of the People has been dissolved or the dissolution of the House of the People takes place during the period of two months referred to in subclause (c), and if a resolution approving the Proclamation has been passed by the Council of States, but no resolution with respect to such Proclamation has been passed by the House of the People before the expiration of that period, the Proclamation shall cease to operate at the expiration of thirty days from the date on which the House of the People first sits after its reconstitution unless before the expiration of the said period of thirty days a resolution approving the Proclamation has been also passed by the House of the People.
  • (3) During the period any such Proclamation as is mentioned in clause (1) is in operation, the executive authority of the Union shall extend to the giving of directions to any State to observe such canons of financial propriety as may be specified in the directions, and to the giving of such other directions as the President may deem necessary and adequate for the purpose.
  • (4) Notwithstanding anything in this Constitution —
    • (a) any such direction may include —
      • (i) a provision requiring the reduction of salaries and allowances of all or any class of persons serving in connection with the affairs of a State;
      • (ii) a provision requiring all Money Bills or other Bills to which the provisions of article 207 apply to be reserved for the consideration of the President after they are passed by the Legislature of the State;
    • (b) it shall be competent for the President during the period any Proclamation issued under this article is in operation to issue directions for the reduction of salaries and allowances of all or any class of persons serving in connection with the affairs of the Union including the Judges of the Supreme Court and the High Courts.
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Full Definition & Explanation

Article 360 of the Indian Constitution deals with financial emergencies. It allows the President to declare a financial emergency if the financial stability or credit of India is threatened. This declaration can affect the financial governance of states, giving the Union government the power to intervene. During such an emergency, the President can direct states to adhere to specific financial propriety standards. This means states may have to cut salaries or reserve certain bills for the President’s consideration. When a financial emergency is declared, the President’s powers expand. This includes the ability to reduce salaries and allowances of state officials and require state governments to follow strict financial guidelines. It’s a way to ensure that the country’s financial health is maintained. For example, in a situation where a state is unable to pay its debts, the President can step in to enforce measures that would help stabilize the economy. However, these powers are not absolute. The declaration must be approved by both Houses of Parliament within two months. If the House of the People is dissolved during this time, special provisions apply. This ensures that there is parliamentary oversight to prevent misuse of this power. In essence, Article 360 provides a mechanism for the federal government to maintain economic control and stability when faced with financial crises, affecting not just governance but also the livelihoods of citizens dependent on state services.

Historical Context

Article 360 was enacted in 1950 as part of the original Constitution. During the Constituent Assembly debates, members discussed the need for a mechanism to address financial instability in states. The framers wanted to ensure that the Union could intervene in serious financial crises. While it has not been amended since, it has been referenced in major Supreme Court cases, including the Minerva Mills case (1980), which emphasized the balance between federal intervention and state autonomy. This case highlighted the need for checks on the President’s powers during a financial emergency.

Key Features

– The President can declare a financial emergency when stability is threatened.
– Parliament must approve the proclamation within two months.
– The President can direct states to follow financial propriety standards.
– Salaries of state officials can be reduced during a financial emergency.
– Money Bills may need the President’s approval after state legislature passage.

Importance & Impact

– The article allows for quick federal intervention in financial crises.
– It ensures that states maintain fiscal discipline during financial emergencies.
– This provision safeguards national financial stability and supports public welfare initiatives.
– Parliamentary approval is necessary to prevent potential misuse of emergency powers.
– This article plays a role in maintaining the overall creditworthiness of the nation.

Sample UPSC Question

Which of the following statements about Article 360 of the Indian Constitution is correct? A) It can be declared only once a year. B) It requires parliamentary approval within two months. C) It allows the President to increase salaries of state officials. D) It applies only to Union territories. Choose the correct answer and explain the implications of your choice. Consider the impact on governance and federal structure.

Answer

The correct answer is B. Article 360 mandates that any proclamation of a financial emergency must receive approval from both Houses of Parliament within two months to remain valid. Options A and D are incorrect because there are no limitations on frequency and it applies to all states, not just Union territories. Option C is wrong as the article allows for salary reductions, not increases.

Key Takeaways

✓ Article 360 allows the President to declare financial emergencies.
✓ Approval from Parliament is necessary to continue the emergency.
✓ States must follow fiscal guidelines during such emergencies.
✓ The article safeguards national financial integrity and stability.
✓ It emphasizes checks on the use of emergency powers.

FAQs

When a financial emergency is declared, the President can issue directives to states regarding fiscal management. This can involve reducing salaries of state officials and ensuring that states follow specific financial guidelines. The Union government takes measures to stabilize the economy, protecting public services and welfare programs during this critical time.

This includes the ability to reduce salaries and allowances of state officials and require state governments to follow strict financial guidelines. It’s a way to ensure that the country’s financial health is maintained. For example, in a situation where a state is unable to pay its debts, the President can step in to enforce measures that would help stabilize the economy.

If the House of the People is dissolved during this time, special provisions apply. This ensures that there is parliamentary oversight to prevent misuse of this power. In essence, Article 360 provides a mechanism for the federal government to maintain economic control and stability when faced with financial crises, affecting not just governance but also the livelihoods of citizens dependent on state services.

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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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