By the 73rd Amendment of the Constitution in 1992, democratic power has been vested with the people at the village level, i.e., empowerment of the Panchayat. By this people have been empowered to participate in the ongoing process of socio-economic change. Panchayats have been composed by persons chosen by direct election from territorial constituencies in the Panchayat area. Each panchayat area has been divided into territorial constituencies in such manner that the ratio between the population of each constituency and the number of seats allotted to it. The chairpersons of the panchayats at the village level and at the panchayat in the intermediate level have earmarked on the basis of direct election.
The chairpersons of a panchayat and the other members of the panchayat whether or not chosen by direct election from territorial constituencies in the panchayat area have the right to vote in the meetings of the panchayat. The chairperson of the panchayat at the village level is elected in such a manner as the legislative of a State provides by law and a panchayat at the Intermediate Level and District Level is elected from amongst the elected members.
There is provision of reservation of seats for scheduled castes and scheduled tribes. In every panchayat and the number of seats so reserved bear as nearly as may be, the same proportion to the total number of seats which are filled up by direct election in that panchayat as the population of the scheduled tribes in that panchayat area bears to the total population of that area. Such seats may be allotted by rotation to different constituencies in a panchayat.
Not less than 1/3rd, of the total number of seats reserved under clause-1 shall be reserved for women belonging to the scheduled castes and scheduled tribes. Of the total number of seats to be filled in by direct election shall be reserved for women and such seats may be allotted by rotation to different constituencies in a panchayat.
The offices of the chairperson in the panchayat at the village level or any other level shall be reserved for scheduled castes, scheduled tribes and woman in such manner as the legislature of State may provide by law.
The reservation of seats under clause-1 & 2 and the reservation of offices of chairpersons under clause-4 shall cease to have effect on the expiration of the period specified in Article-334. Nothing in the part shall prevent the legislative of a State from making any provision for reservation of seats in any panchayat or offices of Chairpersons in the panchayat at any level in favour of backward class of citizens.
Every panchayat, unless sooner dissolved under any law for the time being enforced, shall continue for 5 years from the date appointed for its first meeting and no longer.
A person shall be disqualified for being chosen as, and for being a member of a panchayat, if he is so disqualified by or under any law for the time being in force for the purposes of elections to the legislature of a State concerned, provided that no person shall be disqualified on the ground that he is less than 25 years of age and has attained the age of 21 years.
If any question arises as to whether a member of the panchayat has become subject to any of the disqualifications mentioned in clause-1, the question shall be referred for the decision of such authority and in such manner as the legislative of a State may by law provide.
Subject to the provision of this Act, the legislature of the State may, by law, endow the panchayat with such powers and authority as may be necessary to enable them to function is institutions of self government and such law may contain provisions for the devolution of powers and responsibilities on the panchayats at the appropriate level, subject to such conditions as may be specified therein, with respect to (1) the preparation of plans for economic development and social justice; (2) the implementation of schemes for economic development and social justice as may be entrusted to them including those matters listed in the 11th schedule.
The legislature of the State may, by law, authorize panchayat to levy, collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits. The legislature may assign to panchayat such taxes, duties, tools and fees levied and collected by the state for such purposes and subject to such conditions and limits. Farther, the State may provide grants-in-aid to panchayat from the consolidated fund of the State; and may provide for constitution of such funds for crediting all monies received by or on behalf of panchayat and also for the withdrawal of such monies therefrom as may be specified in the law.
The Governor of a State, within one year from the date of commencement of 73rd Amendment Act, 1992 and thereafter at the expiration of every 5th year constitute a financial commission to review the financial position of the panchayats and to make recommendations to the Governor as regards the distribution between the State and the panchayats of the net proceeds of the taxes, duties, tolls and fees which have been assigned and appropriated by panchayats and review of grants-in-aid to the panchayats from the consolidated fund of the State. It may recommend measures needed to improve the financial position of panchayat.
The state legislature may, be law, make provisions with respect to the maintenance of accounts by the panchayat and auditing of such accounts. The State Election Commission may supervise, direct and control the preparation of electoral rolls for and the conduct of all elections to the panchayats.