Urban Local Government: Municipalities and Cities

1. Urbanisation and the case for city government

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• Why cities need their own government. Cities like Kolkata, Chennai and Mumbai are bigger and more mixed than villages, so running them is harder (Class 6). Urban local bodies are decentralised: local people have a direct say in how their area is run. This is participatory democracy.
• In the Sameer-Anita dialogue, people in a village all know each other, while city people often do not know their neighbours. Elected local bodies speak for city residents.
• In the Constituent Assembly, Rustom Sidhwa (13 October 1949) asked for full local bodies so people could learn administration and rights "in a small sphere".
• Urban area (Census): a statutory town is any place notified by law with a municipality, corporation, cantonment board or notified area committee. A census town is not notified but has at least 5,000 people, at least 75% of male main workers outside farming, and at least 400 persons per sq km. Census towns are still run by panchayats.
• Census 2011: 7,933 towns (4,041 statutory, 3,892 census), about 377 million urban people (31.1%; Class 11: "about 31%"), and 53 million-plus cities. The share today is estimated above 35%; Census 2027 will update it (verify current).
• What is at stake: cities must supply water, sewerage, waste management, transport and housing, and they face slums, floods and heat. Class 11's cartoon asks whether these bodies will give slum dwellers housing or toilets.

2. From the Madras Corporation to the Nagarpalika Bill

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• Madras Municipal Corporation: under an East India Company charter of 1687, Fort St George and all land within 16 km became a corporation. It was set up on 29 September 1688 and is India's oldest municipal body, now the Greater Chennai Corporation. A Parliamentary Act of 1792 let it levy taxes (Class 6).
• Charter of 1726: mayors' corporations were set up in Madras, Bombay and Calcutta.
• Mayo's resolution (1870) decentralised finance.
• Lord Ripon's resolution of 1882 (18 May): called for elected local boards, elected (non-official) majorities, non-official chairpersons, and state control from outside rather than within. It is called the "Magna Carta" of local self-government, and Ripon is called its father.
• Later colonial steps:
• Royal Commission on Decentralisation (1907-09, Hobhouse).
• Government of India Act 1919: local self-government became a transferred subject (a subject handed to elected Indian ministers).
• Cantonments Act 1924.
• Government of India Act 1935: provincial autonomy.

• Nationalists learned to govern in municipalities. C.R. Das was Calcutta's first mayor (1924), with Subhas Bose as CEO.

• After 1947:

• Local government went to State List Entry 5. Councils were often superseded and run by officials.
• Review bodies followed: the National Commission on Urbanisation (1985-88, Charles Correa).
• The 65th Amendment Bill (1989) on nagarpalikas failed in the Rajya Sabha.
• The 1991 Bill became the 74th Amendment in December 1992.

3. The 74th Amendment: Part IXA and three types of municipalities

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• The 74th Constitutional Amendment Act, 1992 came into force on 1 June 1993. It added Part IXA (Arts. 243P-243ZG) and the Twelfth Schedule. Class 11 calls it "in many ways a repetition of the 73rd".
• Art. 243Q creates the three types of urban local bodies:
• Nagar panchayat: for a transitional area that is changing from rural to urban.
• Municipal council: for a smaller urban area.
• Municipal corporation: for a larger urban area. It has elected councillors led by a mayor, but executive power usually rests with a state-appointed commissioner.

• The Governor decides each area's type using population, density, revenue, non-farm jobs and economic importance.

• Class 6 gives fixed population cut-offs (corporation above 10 lakh; council 1-10 lakh; nagar panchayat below). These are simplified: real criteria and names (nagar nigam, nagar palika, nagar parishad) vary by state.

• Art. 243P: a metropolitan area has 10 lakh or more people.
• Art. 243R: all seats are filled by direct election from wards. States may add non-voting members, such as experts, MPs and MLAs.
• Art. 243U: five-year term. Fresh elections must be held within six months of dissolution, and a municipality must be heard before it is dissolved. Panchayats do not get this hearing.
• Other articles:
• Art. 243V: minimum age 21.
• Art. 243ZC: Scheduled Areas are excluded.
• Art. 243ZF: old state laws continue for at most one year.

• Art. 243ZG: courts cannot interfere in electoral matters.

• Number of bodies (Class 11, c. 2005: 100+ corporations, about 1,400 municipalities, 2,000+ nagar panchayats; now about 4,800+ ULBs, verify current).

4. Elections, reservations and ward-level participation

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• Art. 243ZA: the State Election Commission conducts municipal elections. The Governor appoints it; Class 11 says "State government appoints".
• Kishan Singh Tomar case (2006): a Constitution Bench held that elections must be finished before the five-year term ends. Only extraordinary events, such as natural disasters, can justify delay.
• Delays still happen:
• Chennai's council lapsed in 2016 and was elected only in 2022.
• Bengaluru's council lapsed in 2020.

• Maharashtra's corporations were held up by OBC-quota cases (verify current).

• Reservation of seats in municipalities (Art. 243T):

• SC and ST seats are reserved in proportion to their population.
• At least one-third of seats go to women, including within SC/ST seats, rotated among wards.
• Reserving chairperson posts is left to state law (243T(4)). For panchayats it is mandatory (243D(4)).

• OBC quota is optional (243T(6)) and subject to the triple test (K. Krishna Murthy, 2010).

• Women's 50% quota (Class 9): 17 states and 1 UT gave 50% for urban bodies as of 2023, against 21 states and 2 UTs for panchayats. Class 11 (c. 2005) counted 30+ women mayors.

• Wards committee (Art. 243S): required in municipalities with 3 lakh or more people. Class 6 shows ward committees running health camps and reporting leaks and blocked drains.
• Area sabha: a meeting of voters of one polling-booth area. It was proposed in the Model Nagara Raj Bill (2008), but adoption has been patchy (verify current).
• Citizens' duties (Class 6): sort waste and report leaks quickly.

5. Functions: the Twelfth Schedule and city services

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• Art. 243W lets the state give municipalities powers to plan and to perform the Twelfth Schedule functions. The state decides how much to give.

• Twelfth Schedule (18 items): 1. Urban and town planning 2. Land use and building regulation 3. Economic and social development planning 4. Roads and bridges 5. Water supply 6. Public health, sanitation and solid waste 7. Fire services 8. Urban forestry and environment 9. Weaker sections, including persons with disabilities 10. Slum improvement 11. Urban poverty alleviation 12. Parks, gardens and playgrounds 13. Cultural, educational and aesthetic aspects 14. Burials, cremation grounds and electric crematoriums 15. Cattle pounds and prevention of cruelty to animals 16. Vital statistics, including registration of births and deaths 17. Public amenities such as street lights, parking and bus stops 18. Slaughterhouses and tanneries

• Common gaps: school education, hospitals, urban transport and policing usually stay with the state.

• Functions in practice (Class 6): municipal bodies maintain infrastructure and burial grounds, collect garbage, check government schemes, and collect local taxes and fines. Indore's services include water, property tax, licences and a grievance (CRM) system. Some services are paid, which links to §9.
• Swachh Survekshan: MoHUA's yearly cleanliness ranking of cities under SBM-U, run since 2016.
• Indore topped it seven years in a row (2017-2023; shared with Surat in 2023).
• The 2024-25 edition (awards on 17 July 2025) created a Super Swachh League for past toppers. Indore led it.
• Ahmedabad, Bhopal and Lucknow were the top new cleanest cities (verify).

6. Planning the district and the metropolis: DPC and MPC

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• District Planning Committee (Art. 243ZD):
• Required in every district.
• It merges the plans of panchayats and municipalities into a draft district plan, which goes to the state government.

• At least four-fifths of its members are elected by and from the elected members of the district panchayat and the municipalities. Seats are shared in proportion to the district's rural and urban populations.

• Trap: the DPC is in Part IXA (the 74th Amendment), even though it covers rural areas.

• Metropolitan Planning Committee (Art. 243ZE):
• Required for each metropolitan area (10 lakh or more people).
• At least two-thirds of its members are elected by municipal members and panchayat chairpersons.

• It prepares a draft development plan covering spatial planning, water, infrastructure and the environment.

• In practice: many DPCs are dormant, and few MPCs work. Kolkata's MPC is the usual exception (verify current).

• Who really plans: state development authorities such as DDA (1957) and MMRDA (1975).
• Capacity is weak: NITI Aayog (2021) found most towns have no master plan and too few town planners.
• Who plans the region? Greater Bengaluru's 2025 restructuring reopened this question (verify current).

7. Other urban bodies: notified areas, town areas, cantonments, townships and ports

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• Notified area committee:
• Set up by government notification for a fast-growing town, or one that does not yet meet municipal criteria.
• All members, including the chair, are nominated. This sits badly with Art. 243Q's demand for elected bodies.

• Many have since become nagar panchayats.

• Town area committee: a small-town body under a separate state law. It has limited functions (drainage, roads, street lighting) and is wholly or partly elected.

• Industrial township: a place where a big company provides civic services itself. Under the Art. 243Q proviso, the Governor may exempt it from having a municipality. Examples: Bhilai, Bokaro, Jamshedpur (verify current status).
• Port trust: managed a major port and gave civic services in the port area. Major ports are now run by port authorities under the Major Port Authorities Act 2021, which replaced the 1963 Act.
• Cantonment board: serves the civilian population of military cantonments.
• Governed by the Cantonments Act 2006 and run by the Ministry of Defence.
• The station commander is president. Members are partly elected and partly nominated.
• 62 cantonments in 2023.

• In 2023 the government decided to cut out civil areas and merge them with nearby municipalities. Khas Yol (HP) was de-notified on 27 April 2023 (verify progress).

• Special-purpose agencies: single-task bodies such as water boards, housing boards and Smart City SPVs. They answer to the state, not to the city council.

8. Who runs the city: mayor, commissioner and councillors

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• Two wings:
• The deliberative wing (the body that debates and decides) is the council of ward councillors, led by the mayor or chairperson.

• The executive wing (the body that carries out decisions) is headed by the commissioner or chief officer.

• Municipal commissioner system: a state-appointed commissioner, usually an IAS officer, holds the executive power by law. The council only deliberates. This is the Mumbai model (Act of 1888).

• Mayor-in-council system: the mayor and a cabinet of councillors hold executive power, with the commissioner working under them. Kolkata has used it since its 1980 Act.
• Committee system: in older councils, standing committees do executive work.
• Mayor: the head of the corporation, chosen directly by voters or by councillors as state law decides. Reservation for women, SCs and STs can apply to the post.
• Delhi: one-year term.

• Mumbai: two and a half years.

• Directly elected mayor: used in some states (e.g. UP, MP, Haryana; verify current). The Second ARC (2007) backed a directly elected mayor with a five-year term as executive head.

• For: a fixed term and a stronger mandate.

• Against: deadlock if the mayor and council are from different parties.

• Court cases:

• Shelly Oberoi (2023): nominated members cannot vote in the mayor's election.
• Kuldeep Kumar v. U.T. Chandigarh (2024): the Court used Art. 142 (its special power to do complete justice) to overturn a tampered count and declare the rightful mayor.
• NCT of Delhi v. Office of the LG (2024): the LG nominates aldermen (nominated expert members) using a power given by law, without needing the Delhi government's advice.

9. Municipal finance: property tax, transfers and municipal bonds

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• Constitutional basis:
• Art. 243X: the state may let municipalities levy taxes and fees and may give them grants.
• Art. 243Y: the State Finance Commission reviews municipal finances.

• Art. 280(3)(c): the Union Finance Commission suggests ways to boost state funds for municipalities.

• Own sources:

• Property tax: a tax on land and buildings and the main own revenue of ULBs. It is assessed by rental value, unit area or capital value, and increasingly mapped with GIS.
• Profession tax, capped at ₹2,500 by Art. 276.
• Entertainment tax by local bodies, allowed under State List Entry 62.
• User charges.

• Octroi was lost, and GST (2017) absorbed entry taxes.

• Weak finances:

• Class 11: local bodies have "very little funds of their own".
• RBI Report on Municipal Finances (13 November 2024): covers 232 corporations. They depend heavily on transfers, and the top 10 take over 58% of all municipal revenue.

• Municipal revenue is about 0.6% of GDP (verify current).

• Finance Commission grants:

• 15th FC: ₹1.21 lakh crore for ULBs (2021-26), linked to notified property-tax floor rates and published accounts.

• 16th FC: about ₹3.56 lakh crore, including an urbanisation premium (verify).

• Municipal bonds: debt that cities sell to raise money for infrastructure.

• Bangalore 1997: first issue, with a state guarantee.
• Ahmedabad 1998: first without a guarantee.
• SEBI regulations 2015; Pune issued under them in 2017.
• Ghaziabad 2021: first green bond.

10. Urban missions: JNNURM to AMRUT, Smart Cities, SBM-U and PMAY-U

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• JNNURM (December 2005-2014): funded infrastructure and housing for the poor in 65 mission cities. Money came only if states made reforms, such as implementing the 74th Amendment, passing community-participation laws and reforming property tax.
• Swachh Bharat Mission-Urban:
• Launched 2 October 2014 to make cities open-defecation free and manage waste.

• SBM-U 2.0 (1 October 2021-2026) aims at garbage-free cities.

• AMRUT:

• Launched 25 June 2015 for water, sewerage and green spaces in 500 cities.

• AMRUT 2.0 (2021-26) aims at universal tap water in all statutory towns.

• Smart Cities Mission:

• Launched 25 June 2015 for 100 cities chosen by competition.
• Focused on area-based projects and technology, run by SPVs (special purpose vehicles, i.e. companies).

• Formally ended 31 March 2025.

• PMAY-Urban: launched 25 June 2015 to give pucca houses to the urban poor. PMAY-U 2.0 was approved in 2024 for one crore more houses (verify).

• Street Vendors Act 2014:
• Vendor surveys and vending certificates.
• Town vending committees with at least 40% vendor members, a third of them women.
• Vending zones, and no eviction before a survey.

• Linked schemes: PM SVANidhi (2020) loans.

• The tension: missions are designed by the Centre, come with conditions and often run through SPVs. They can push elected councils aside.

11. Why cities remain weak: implementation gaps and reform

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• Class 11's verdict:
• Gains: every state passed conforming laws, elections are held, and women, SC and ST members are present.
• Gaps: limited autonomy, few subjects transferred, and very little money of their own. Local bodies remain "agencies implementing" state and central schemes.

• "The true test of democracy is ... in the practice."

• CAG audits (2020-24):

• Karnataka: ULBs had full control of few of the 18 functions (verify).
• Odisha: elections were overdue in 106 of 114 audited ULBs.

• Common findings: staff shortages, late SFCs and supersessions.

• Parastatal agencies: state bodies such as development authorities, water boards and housing boards. They do core Twelfth Schedule work (planning, water, housing) but answer to the state, not the council. This splits accountability.

• Capacity gaps: too few planners and engineers, poor accounts, and census towns with no ULB at all.
• Reform agenda (Second ARC, 2007):
• An empowered, directly elected mayor.
• A municipal staff cadre.
• Clear devolution through activity mapping.
• Working ward committees and area sabhas.

• Functional MPCs.

• Benchmark: Class 11's Brazil box shows municipal powers protected by the constitution, a model India did not adopt.

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Exam angles

Prelims — high-yield facts and traps

• Article map:
• 243P: definitions; metro area = 10 lakh+
• 243Q: three types; industrial-township proviso
• 243R: composition; non-voting members
• 243S: wards committee at 3 lakh+
• 243T: reservation
• 243U: five-year term; hearing before dissolution
• 243V: minimum age 21
• 243W: Twelfth Schedule
• 243X: taxes
• 243Y: SFC
• 243ZA: SEC
• 243ZC: excluded areas
• 243ZD: DPC (four-fifths elected)
• 243ZE: MPC (two-thirds elected)
• 243ZF: existing laws
• 243ZG: bar on courts

• Part IXB is cooperatives (97th Amendment, 2011).

• Traps:

• "The DPC is in Part IXB/IX": FALSE. It is in Part IXA.
• "Reservation of chairpersons is mandatory for municipalities": FALSE. It is left to state law (243T(4)); it is mandatory only for panchayats (243D(4)).
• "Panchayats get a hearing before dissolution": FALSE. Only municipalities do.
• "Nominated members can vote for the mayor": FALSE (Shelly Oberoi, 2023).

• "Notified area committees are elected": FALSE. They are wholly nominated.

• Dates:

• Madras Corporation: charter 1687, set up 29 September 1688
• Mayo: 1870
• Ripon: 18 May 1882
• 74th Amendment in force: 1 June 1993 (73rd: 24 April 1993)
• JNNURM: December 2005
• SBM-U: 2 October 2014
• AMRUT, SCM and PMAY-U: 25 June 2015
• SCM ended: 31 March 2025

• SBM-U 2.0 and AMRUT 2.0: 1 October 2021

• Twelfth (18 items) vs Eleventh (29 items) Schedule: fire services, slum upgradation, vital statistics, slaughterhouses and cattle pounds appear only in the Twelfth.

• Cantonment board: Ministry of Defence, Cantonments Act 2006, station commander as president. Port trusts became port authorities in 2021.
• Cases:
• Kishansing Tomar (2006): timely elections
• K. Krishna Murthy (2010): OBC triple test
• Kuldeep Kumar (2024): Art. 142 and the Chandigarh mayor

• NCT of Delhi v. LG (2024): LG nominates aldermen on its own

• Models: commissioner system (Mumbai) vs mayor-in-council (Kolkata).

• Bonds: Bangalore 1997 first; SEBI rules 2015; Ghaziabad 2021 first green bond.
• Census urban criteria: 5,000 people, 75% of male workers non-farm, 400 per sq km. 31% urban in 2011.

Mains — GS-II themes

1. Why the 74th Amendment underdelivered: incomplete devolution, parastatals, state control, delayed elections. Cities are "elected but not self-governing".
2. Municipal finance: weak own revenue, property-tax reform, FC conditions, RBI 2024 findings, municipal bonds, and the case for automatic transfers (Bolivia box).
3. Leadership design: directly elected, empowered mayor vs commissioner system. The Delhi and Chandigarh mayoral disputes.
4. Metropolitan governance: MPCs that do not work, scattered agencies, and urban floods in Bengaluru, Chennai and Mumbai as governance failures.
5. Central missions vs decentralisation: Smart City SPVs, and reform-linked funding under JNNURM and AMRUT.
6. Citizen participation: ward committees, area sabhas, participatory budgeting, citizens' duties, and inclusion of street vendors and slum dwellers.
7. Hidden urbanisation: census towns governed as villages, and the 16th FC's urbanisation premium.

Current-affairs hooks

• Swachh Survekshan results and the Super Swachh League; the end of SBM-U 2.0 and AMRUT 2.0 and their successor schemes.
• Mayoral polls in Delhi and Chandigarh; delayed polls and restructuring in Greater Bengaluru and Maharashtra.
• RBI municipal finance reports; green bond issues; the Urban Challenge Fund.
• 16th FC urban grants; urban data from Census 2027.
• Cantonment civil-area excision; PMAY-U 2.0 progress; reviews of the Smart Cities Mission after its close.