Questions for: The Finance Commission

• Q: Which one of the following authorities recommends the principles governing the grants-in-aid of the revenues to the States out of the Consolidated Fund of India?
  
  A) Finance Commission

  B) Inter-State Council

  C) Union Ministry of Finance

  D) Public Accounts Committee
  Answer: A
  Explanation:
• Q: Which one of the following institutions will lay down the basic principles for the distribution of the net proceeds of the taxes between the Union and States?
  
  A) Planning Commission

  B) National Development Council

  C) Finance Commission

  D) Union Ministry of Finance
  Answer: C
  Explanation:
• Q: Generally, in India Finance Commission is appointed for every five years
  
  A) To determine the financial position of the States

  B) To determine the financial position of Central Government

  C) To determine the financial resources of Central Government

  D) To determine the share of the States in the grants and revenues of the Central Government
  Answer: D
  Explanation:
• Q: Finance are distributed between the Centre and the State on the recommendations of which of the following?
  
  A) Planning Commission

  B) Public Accounts Committee

  C) Finance Commission

  D) National Development Council
  Answer: C
  Explanation:
• Q: The main functions of Finance Commission is
  
  A) To determine the part of States in central taxes and to determine the principles of financial aid given by the Centre to States

  B) Financial control over States

  C) Financial control over Central

  D) None of the above
  Answer: A
  Explanation:
• Q: The Finance Commission is primarily concerned with recommending to the President about
  
  A) The principle governing grants-in-aid to be given to the States

  B) Distributing the net proceeds of the taxes between the Centre and the States

  C) Neither (A) nor (B)

  D) Both (A) and (B)
  Answer: D
  Explanation:
• Q: With reference to the Finance Commission of India, which of the following statements is correct?
  
  A) It encourages the inflow of foreign capital for infrastructure development

  B) It facilitates the proper distribution of finances among the Public Sector Undertakings

  C) It ensures transparency in financial administration

  D) None of the statements (A), (B) and (C) given above is correct in this context
  Answer: D
  Explanation:
• Q: Which one of the following is not a function of Finance Commission in India?
  
  A) Devolution of Income Tax

  B) Devolution of Excise Duty

  C) Award of grants-in-aid

  D) Devolution of Trade Tax
  Answer: D
  Explanation:
• Q: Federal Finance Commission in India relates to
  
  A) Finances among the States

  B) Finances between States and the Centre

  C) Finances between the Centre and Local Self Governments

  D) None of the above
  Answer: B
  Explanation:
• Q: Main agency to resolve the fiscal disputes between the Centre and States is
  
  A) Supreme Court

  B) Law Minister

  C) Finance Minister

  D) Finance Commission
  Answer: D
  Explanation:
• Q: The Provisions regarding division of taxes between the Union and the States
  
  A) Can be suspended during Financial Emergency

  B) Can be suspended during National Emergency

  C) Cannot be suspended under any circumstances

  D) Can be suspended only with the consent of a majority of the State Legislatures
  Answer: B
  Explanation:
• Q: Who was the Chairman of the Twelfth Finance Commission?
  
  A) A.M. Khusro

  B) K.C. Pant

  C) Montek Singh

  D) C. Rangarajan
  Answer: D
  Explanation:
• Q: Who was the Chairman of the 13th Finance Commission?
  
  A) Indira Rajaraman

  B) C. Rangarajan

  C) Vijay Kelkar

  D) None of the above
  Answer: C
  Explanation:
• Q: Who among the following was the Chairman of 14th Finance Commission?
  
  A) Shanta Kumar

  B) C. Rangarajan

  C) Y.V. Reddy

  D) None of the above
  Answer: C
  Explanation:
• Q: Who of the following shall cause every recommendation made by the Finance Commission to be laid before each House of the Parliament?
  
  A) The President of India

  B) The Speaker of Lok Sabha

  C) The Prime Minister of India

  D) The Union Finance Minister
  Answer: A
  Explanation:
• Q: The Finance Commission is constituted for a period of
  
  A) 4 years

  B) 5 years

  C) 7 years

  D) 10 years
  Answer: B
  Explanation:
• Q: Which one of the following statements about a State Finance Commission is true?
  
  A) It is an informal body

  B) It is a Constitutional body

  C) It is an Administrative body

  D) None of the above
  Answer: B
  Explanation:
• Q: After the commencement of the Constitution how many Finance Commissions have been constituted?
  
  A) 10

  B) 8

  C) 9

  D) 15
  Answer: D
  Explanation:
• Q: The Finance Commission consists of a Chairman and
  
  A) Seven other members

  B) Five other members

  C) Four other members

  D) Such other members as may be decided by the President from time-to-time
  Answer: C
  Explanation:
• Q: Consider the following statements. In India taxes on transactions in Stock-Exchanges and Futures Markets are 1. Levied by Union 2. Collected by the State Government
  
  A) Only 1

  B) Only 2

  C) Both 1 and 2

  D) Neither 1 nor 2
  Answer: C
  Explanation:
• Q: Consider the following statements. The function(s) of the Finance Commission is/are 1. To allow the withdrawal of the money out of the Consolidated Fund of India. 2. To allocate among the States the shares of proceeds of taxes. 3. To consider applications for grants-in-aid from States. 4. To supervise and report on whether the Union and State Governments are levying taxes in accordance with the budgetary provisions.
  
  A) Only 1

  B) 2 and 3

  C) 3 and 4

  D) 1, 2 and 4
  Answer: B
  Explanation:
• Q: Consider the following statements and select the correct answer from the code given below. Assertion (A): State Finance Commission is a Constitutional body. Reason (R): Union Finance Commission cannot recommend financial assistance to Panchayats. Code
  
  A) Both (A) and (R) are true and (R) is the correct explanation of (A)

  B) Both (A) and (R) are true, but (R) is not the correct explanation of (A)

  C) (A) is true, but (R) is false

  D) (A) is false, but (R) is true
  Answer: C
  Explanation: