Finance Commission of India GK Notes

Photo of author

3 Minutes Read

Finance commission is an autonomous body of the government of India. Its purpose is to allocate certain revenue resources between the Union and the State.

Finance Commission UPSC Notes

The Finance Commission of India is a constitutional body established under Article 280. Its main function is to recommend the distribution of revenue and financial resources between the central government and the state.

The Finance Commission of India was established in 1951. It is formed to determine the financial relationship between the center and the states. According to the constitution, the commission consists of a chairman and four other members every five years. •

  • Website:
  • Established: 22 November 1951
  • Purpose: Maintain financial relations between the center and the state
  • Jurisdiction: Government of India
  • Headquarters: New Delhi
  • First executive: Kshitish Chandra Neogy

Article 280 related to Finance Commission of India

  • Recommend the distribution of revenue resources between the central and state governments.
  • Recommend the sharing of central tax revenues, and grants-in-aid to states.
  • Submits its recommendations to the President periodically, typically every five years.

Composition of Finance Commission

  1. Chairman: The Finance Commission is headed by a Chairman.
  2. Members: The Finance Commission consists of four other members.

Functions of Finance Commission of India

  1. Provide recommendations for the sharing of tax revenues between the centre and states.
  2. Suggests Grants-in-Aid to states.
  3. Improve fiscal responsibility and financial management.
  4. Reviews the financial status of the central and state such as revenue and expenditure patterns.
  5. Serves as an advisory body to the President on financial matters.
  6. Consults with various stakeholders and experts in finance and economics.

Important Points to Remember: Finance Commission of India

01. In 2013 the Fourteenth Finance Commission was formed under the presidency of Y. V. Reddy (whose term lasted from 2015 to 2020).

02. At present (2022 Oct), the 15th Finance Commission has been constituted under the chairmanship of Nanda Kishor Singh, whose term started in 2020.

List of Chairman in Finance Commission

Finance CommissionChairmanAppointed
1stK.C. Neogy1951
2ndK. Santhanam1956
3rdA.K. Chanda1960
4thDr. P.V. Rajamannar1964
5thMahavir Tyagi1968
6thBrahamananda Reddy1972
7thJ.M. Shelat1977
8thY.B. Chavan1982
9thN.K.P. Salve1987
10thK.C. Pant1992
11thA.M. Khusro1998
12thDr. C. Rangarajan2002
13thDr. Vijay Kelkar2007
14thY.V. Reddy2013
15thN.K Singh2017
16thArvind Panagariya2024

FAQs: Finance Commission: