Article 263

Article 263 of the Constitution of India provides for the establishment of an Inter-State Council to promote cooperation and coordination between the Union and the States and among the States themselves. The Article empowers the President to constitute such a Council whenever it is deemed necessary in the public interest. The provision is a key component of India’s federal framework, designed to foster dialogue, consultation, and consensus among the various tiers of government.

Background and Constitutional Context

The idea of creating a body to facilitate cooperation among the States and the Union originates from the federal experiences of other nations, particularly the United States and Canada. During the deliberations of the Constituent Assembly, Dr. B.R. Ambedkar emphasised the need for a mechanism that could resolve inter-State differences and encourage collaborative decision-making without resorting to judicial or political confrontation.
Article 263 was therefore incorporated into the Constitution to ensure smooth intergovernmental relations and to provide an institutional platform for addressing disputes, discussing common concerns, and coordinating policies. It appears in Part XI of the Constitution, which deals with relations between the Union and the States, highlighting its importance as a tool of cooperative federalism.

Constitutional Provision and Presidential Authority

Article 263 empowers the President of India to establish an Inter-State Council if it appears to him that such a body would serve the public interest. The President determines:

• The duties of the Council;
• The organisation and composition of the Council; and
• The procedure to be followed by the Council in performing its functions.

This wide discretion allows flexibility in the Council’s structure and operations, enabling it to adapt to the evolving needs of India’s federal polity.

Functions of the Inter-State Council

Article 263 outlines three broad functions for the Inter-State Council:

1. Inquiry and Advice on Inter-State Disputes: The Council may inquire into and advise upon disputes arising between States. This function allows it to act as a conciliatory and advisory body rather than a judicial authority. It promotes negotiation and settlement before conflicts escalate into legal disputes or political crises.
2. Investigation and Discussion of Common Interests: The Council may investigate and discuss subjects of common interest to the States or between the Union and the States. Such issues may include economic development, education, health, environment, or social welfare policies that require intergovernmental coordination.
3. Recommendations for Coordination of Policy and Action: The Council may make recommendations for improved coordination of policy and action on matters of shared concern. This consultative process enhances the coherence of national and State policies, preventing overlaps and contradictions.

Through these functions, the Inter-State Council acts as a non-judicial dispute resolution mechanism and a forum for policy harmonisation.

Establishment and Composition of the Inter-State Council

Although Article 263 does not make the establishment of the Council mandatory, it authorises the President to constitute it when necessary. Acting on the recommendation of the Sarkaria Commission on Centre-State Relations (1988), the President formally established the Inter-State Council (ISC) on 28 May 1990 through a Presidential Order.
The Council’s composition includes:

• Prime Minister of India – Chairperson;
• Chief Ministers of all States – Members;
• Chief Ministers of Union Territories having Legislative Assemblies – Members;
• Administrators of Union Territories without Legislatures – Members;
• Six Union Ministers nominated by the Prime Minister – Members.

The Union Home Minister functions as the Vice-Chairman of the Council, and the Inter-State Council Secretariat, operating under the Ministry of Home Affairs, provides administrative and research support.

Role and Scope of the Council

The Inter-State Council serves as a forum for dialogue between the Union and State Governments. It aims to reduce friction in intergovernmental relations by facilitating:

• Policy coordination on national programmes implemented through the States;
• Harmonisation of legislation on concurrent subjects;
• Resolution of disputes over inter-State boundaries or resource sharing; and
• Discussion on fiscal and administrative issues related to Centre-State relations.

The Council has deliberated on various matters, such as the implementation of Goods and Services Tax (GST), inter-State river disputes, internal security coordination, and decentralisation of governance. It thus functions as a key advisory and consultative institution in the federal framework.

Judicial Context and Interpretation

While there are no major Supreme Court judgments directly interpreting Article 263, its spirit has been reinforced through decisions addressing the broader principles of federalism and intergovernmental cooperation.
For example, in State of Karnataka v. Union of India (1977), the Supreme Court emphasised that cooperation between the Centre and States is essential for the effective functioning of the Constitution. Similarly, in S.R. Bommai v. Union of India (1994), the Court recognised federalism as part of the basic structure of the Constitution, indirectly supporting the objectives of Article 263.

Significance in the Federal Framework

The Inter-State Council represents a constitutional mechanism to strengthen the fabric of Indian federalism through cooperation rather than competition. Its importance can be summarised as follows:

• Promotes Cooperative Federalism: By providing a platform for discussion, it ensures that disputes and differences are resolved through dialogue.
• Prevents Litigation: It offers an alternative to judicial intervention, enabling States to address conflicts politically and administratively.
• Enhances Policy Coordination: The Council facilitates uniform policy implementation across the Union and States.
• Encourages Consensus Building: It brings together leaders from diverse political and regional backgrounds, fostering national integration.

In this way, Article 263 transforms India’s federal structure into a functional federation, where interdependence is managed through institutionalised consultation.

Administrative and Institutional Developments

The Inter-State Council Secretariat, established in 1990, serves as the permanent administrative unit supporting the Council’s work. It functions as part of the Ministry of Home Affairs and also assists the Zonal Councils, which were created under the States Reorganisation Act, 1956.
Since its inception, the Inter-State Council has convened several meetings to discuss pressing national and inter-State issues. Subordinate committees, such as the Standing Committee of the Inter-State Council, have been formed to examine specific matters and prepare reports for full Council consideration.

Challenges and Limitations

Despite its constitutional importance, the Inter-State Council has faced challenges in fulfilling its potential:

• Irregular Meetings: The Council has met infrequently since its establishment, limiting its impact on policy coordination.
• Advisory Nature: Its recommendations are not binding on the Union or the States, reducing its authority in resolving disputes.
• Political Factors: Differences in political ideology between State and Central Governments can hinder cooperation.
• Limited Public Awareness: The Council’s work often remains confined to bureaucratic circles, with minimal public visibility or accountability.

Recommendations for Strengthening the Council

Various commissions and committees have recommended strengthening the Inter-State Council to enhance its effectiveness:

• The Punchhi Commission on Centre-State Relations (2010) proposed that the Council should meet at least twice a year and act as a permanent, vibrant institution of cooperative federalism.
• It also suggested greater transparency, inclusion of subject experts, and improved follow-up mechanisms for implementing the Council’s recommendations.