Article 282

Article 282 of the Constitution of India is a key provision under Part XII, which deals with financial relations between the Union and the States. It empowers both levels of government to make grants for public purposes, thereby serving as an essential instrument of fiscal flexibility and cooperative federalism in the country’s governance framework.

Constitutional Background and Purpose

The Indian Constitution divides legislative and financial powers between the Union and the States through the Seventh Schedule. However, Article 282 acts as an enabling provision that allows both entities to go beyond these constitutional limits to fund activities deemed to serve the public purpose, even if such purposes do not fall strictly within their legislative competence.
The article states that:“The Union or a State may make any grants for any public purpose, notwithstanding that the purpose is not one with respect to which Parliament or the Legislature of the State, as the case may be, may make laws.”
This provision grants significant financial discretion to both the Union and the States, promoting flexibility in addressing developmental priorities and emergencies.

Scope and Interpretation of Article 282

The scope of Article 282 is intentionally broad. It allows both governments to spend from their respective revenues for any public purpose, without being confined by the division of legislative powers under Article 246 or the Seventh Schedule. This flexibility has been particularly valuable for funding welfare schemes, infrastructure development, education, healthcare, disaster management, and other initiatives that serve the general interest of society.
The term “public purpose” has not been exhaustively defined in the Constitution, ensuring that the concept remains adaptable to changing societal needs. Consequently, governments can interpret public purpose to include both traditional and emerging areas of governance such as environmental protection, social justice, and digital transformation.

Judicial Interpretation and Case Law

The judiciary has consistently upheld the constitutional validity and wide interpretation of Article 282. Several landmark cases have elaborated on its scope and implications:

• State of West Bengal v. Union of India (1963): The Supreme Court affirmed that the Union and the States have the constitutional authority to make grants for public purposes, reinforcing the principle that such financial assistance is not restricted by legislative competence.
• Keshavananda Bharati v. State of Kerala (1973): The Court highlighted that the spirit of the Constitution is to promote public welfare and that financial powers like those under Article 282 must be exercised to uphold constitutional goals such as social and economic justice.
• Indira Gandhi v. Raj Narain (1975): While primarily a case concerning electoral law, the Court reiterated that all governmental powers, including fiscal ones, must be directed toward promoting the public good.

Through these rulings, the judiciary has recognised Article 282 as a flexible fiscal tool designed to empower both levels of government to respond effectively to the needs of citizens.

Relation to Other Constitutional Provisions

Article 282 operates in harmony with other financial provisions of the Constitution, including:

• Article 275: Provides for grants-in-aid to States from the Consolidated Fund of India to meet specific needs, such as the welfare of Scheduled Tribes or to supplement state resources.
• Article 280: Establishes the Finance Commission, which recommends the distribution of financial resources between the Union and the States.
• Article 246: Defines the distribution of legislative powers between the Union and the States. Article 282 allows spending even beyond these enumerated legislative fields when it serves a public purpose.

Together, these provisions create a coherent financial framework aimed at promoting balanced economic development and ensuring that no part of the country is left behind due to fiscal constraints.

Financial Administration and Management

In the realm of financial governance, Article 282 provides the Union and the States with discretionary spending powers. This flexibility enables governments to make budgetary allocations to meet emerging priorities and unforeseen contingencies.
For instance, the Union Government frequently extends grants to States for implementing national schemes such as the Pradhan Mantri Gram Sadak Yojana (PMGSY), National Health Mission (NHM), or Mid-Day Meal Scheme, all of which serve public purposes though they may fall within the States’ legislative domain. Similarly, States can fund activities that may not be explicitly mentioned within their legislative competence but are essential for local welfare.
All grants made under Article 282 are subject to audit and accountability, primarily conducted by the Comptroller and Auditor General (CAG) of India. This ensures that public funds are utilised efficiently and in accordance with principles of financial propriety.

Definition and Application of “Public Purpose”

Although the Constitution does not define the term “public purpose,” it is generally understood to refer to any activity that benefits the public or a section of it. Typical examples include:

• Welfare schemes such as health insurance or housing assistance.
• Infrastructure projects like roads, bridges, and power supply.
• Educational initiatives aimed at improving literacy and skill development.
• Disaster relief and rehabilitation programmes.
• Social justice measures, including empowerment of marginalised communities.

The broad and evolving understanding of public purpose allows the Union and States to respond to the dynamic needs of governance and socio-economic development.

Limitations and Accountability

Although Article 282 grants extensive spending powers, certain constitutional and administrative safeguards apply:

• Expenditure must be strictly for public purposes and cannot serve private or partisan interests.
• Misuse of funds or deviation from declared purposes may attract judicial scrutiny.
• Parliamentary and State legislative oversight ensures that grants are made transparently and within approved budgetary frameworks.
• All spending must conform to the standards of financial propriety and accountability laid down in public financial management systems.

Thus, while Article 282 allows fiscal flexibility, it also reinforces the principle of responsible governance.

Impact on Federalism and Cooperative Development

Article 282 significantly influences India’s model of cooperative federalism. It enables the Union Government to provide financial support to the States for development projects that may not fall within the Union List, thereby bridging regional disparities and promoting balanced growth. Similarly, States can use their resources to complement central initiatives.
This overlapping financial jurisdiction fosters collaboration between the two levels of government, ensuring that national and regional objectives are aligned. The provision has also been instrumental in implementing centrally sponsored schemes and developmental programmes that require joint funding and execution.

Practical Applications

In practice, Article 282 serves as the constitutional foundation for grants-in-aid and financial assistance across a broad range of sectors. Common applications include:

• Disaster management, such as relief funds for floods, earthquakes, or droughts.
• Public health programmes, including vaccination drives and epidemic control.
• Education and skill development, especially in rural or underdeveloped areas.
• Infrastructure development, including urban renewal and transport connectivity.
• Poverty alleviation and social welfare, focusing on vulnerable populations.