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

Detail

1. Why these bodies matter

• The 74th Amendment (1992) created Part IXA of the Constitution. Art. 243Q names three kinds of municipality: the nagar panchayat (for an area moving from rural to urban), the municipal council (for a smaller urban area) and the municipal corporation (for a larger urban area).
• Many towns are still run by other bodies. Some of these bodies come from older state laws. Some come from central laws. Some are allowed by the Constitution itself.
• Six such bodies matter for the exam:
• notified area committee
• town area committee
• industrial township
• port trust (now port authority)
• cantonment board
• special-purpose agency

2. Notified area committee (NAC)

• Definition: a notified area committee is a body set up by a government notification in the state gazette (the government's official journal). It runs a town that is:
• growing fast, often because of new industry, or

• not yet able to meet the rules for a municipality (population, income, density).

• Legal base: the state municipal act. The town is "notified" under that act, so the NAC uses the powers a municipality would have under it.

• Who sits on it: every member, including the chairperson, is nominated by the state government. No one is elected.
• Problem with the Constitution:
• Under Art. 243R, a municipality's seats must be filled by direct election.
• A body where every member is nominated does not meet the elected-body rule of Part IXA.

• So after 1993, many states turned their NACs into nagar panchayats with elected members.

• Odisha example: Odisha kept the name "NAC" for many small urban bodies. The CAG (Comptroller and Auditor General, who audits government accounts) has reviewed these bodies in its audits of how far the 74th Amendment has been carried out in the state.

3. Town area committee

• Definition: a town area committee is a body for a small town. It is created under a separate state act, not the main municipal act.
• Limited functions: drainage, roads, street lighting and conservancy (cleaning streets and removing waste).
• Who sits on it: members are wholly or partly elected, depending on the state law.
• Like the NAC, it is a semi-municipal body (it does only some municipal work). Many have since been turned into nagar panchayats.

4. Industrial township

• Definition: an industrial township is an urban area where a large industrial company provides civic services (water, roads, sanitation, street lights) through its own administration. Because of this, the area does not need an elected municipality.
• Constitutional anchor, the Art. 243Q(1) proviso: a municipality need not be set up in an urban area that the Governor, by public notification, declares to be an industrial township. The Governor looks at:
• the size of the area
• the municipal services provided, or proposed to be provided, by an industrial establishment there

• any other factors the Governor thinks fit [7]

• How it works, step by step: 1. An industrial establishment runs, or plans to run, civic services in an area. 2. The Governor issues a public notification declaring the area an industrial township under the Art. 243Q proviso [7]. 3. No elected municipality is set up there. The company or a state industrial body provides the services.

• State laws that use the proviso:

• The Uttar Pradesh Industrial Area Development Act, 1976 lets industrial development areas, or parts of them, be declared townships under the Art. 243Q(1) proviso [8].

• The Andhra Pradesh Industrial Corridor Development Act, 2017 treats areas notified under an industrial node as industrial townships under the same proviso [9].

• Examples: steel towns such as Bhilai (Chhattisgarh) and Bokaro (Jharkhand). Jamshedpur (Jharkhand) has been in a long dispute over whether it should be a municipal corporation or an industrial township, where Tata Steel's subsidiary provides the services. Check the latest official status before the exam.

• Democratic cost: people living in an industrial township do not elect a local council. Services depend on a company, not on voters.

5. Port trusts, now port authorities

• Definition: a port trust was the body that managed a major port (a port under the Union government; minor ports are under state governments). It also gave civic services, such as roads, water and lighting, in the port area.
• Old law: Major Port Trusts Act, 1963.
• New law: the Major Port Authorities Act, 2021 replaced and repealed the 1963 Act [3]. It came into force on 3 November 2021 [4].
• Aim: to plan, run and regulate major ports and to give them more autonomy (freedom to take their own decisions) [3].
• Ports covered: Chennai, Cochin, Jawaharlal Nehru Port, Kandla, Kolkata, Mumbai, New Mangalore, Mormugao, Paradip, V.O. Chidambaranar and Visakhapatnam [3].
• Tariff change: the Union government sets up an Adjudicatory Board. It replaces the Tariff Authority for Major Ports, which existed under the 1963 Act [3].
• Exam point: "port trust" is now an old term for major ports. The current body is a Board of Major Port Authority.

6. Cantonment boards

6.1 Definition and law

• Definition: a cantonment is an area set aside for military forces, along with the civilians who live there. A cantonment board is the local body that serves the civilian population of a cantonment.
• Law: the Cantonments Act, 2006 (Act No. 41 of 2006). It received assent on 13 September 2006 [6]. It replaced the Cantonments Act, 1924.
• Who runs them: the Union Ministry of Defence, through the Directorate General Defence Estates (DGDE).
• Why it is a Union subject: cantonments come under the Union's power over defence. They are outside state municipal laws. That is why the 2023 reform described below needs state consent.

6.2 Categories by population (Cantonments Act 2006) [5]

Category	Population	Elected members	Nominated military officers
I	above 50,000	8	3
II	10,001 to 50,000	7	2
III	2,501 to 10,000	6	1
IV	up to 2,500	2	0

• Ex officio members in Categories I to III (members because of the post they hold): the Officer Commanding the station, the District Magistrate or an Executive Magistrate nominated by the District Magistrate, the Chief Executive Officer, the Health Officer and the Executive Engineer [5].
• Category IV board: the Officer Commanding the station, the CEO and two elected members [5].

6.3 Office-bearers

• President: the Officer Commanding the station (the station commander) is president if a member of the board. If not, the military officer nominated in that place becomes president [5].
• Vice-president: chosen by election.
• Chief Executive Officer (CEO): an officer of the Indian Defence Estates Service (IDES). The CEO also acts as member-secretary.
• Key point: the board is partly elected and partly nominated, and a military officer heads it. In Categories I to III, elected members are only about half the board. So a cantonment board is less democratic than a Part IXA municipality.

6.4 Numbers (Ministry of Defence, 2023)

• 62 cantonments in 19 states.

6.5 The 2023 reform: civil areas to be cut out and merged

• Aim: to give the same municipal laws to civil areas of cantonments and to nearby state municipal areas. The government decided to excise (cut out) the civil areas of certain cantonments and merge them with neighbouring state municipalities [2].
• Progress:
• Broad modalities (the main steps) for excision in 58 cantonments were sent to the state governments concerned for comments [2].
• Khas Yol (Himachal Pradesh) was de-notified with effect from 27 April 2023 [2].

• Each merger needs the consultation and concurrence (agreement) of the state government. So no time-frame could be given [2].

• How a merger happens, step by step: 1. The Ministry of Defence identifies the civil area and sends the modalities to the state. 2. The state government comments and gives its agreement. 3. The civil area is excised. It then comes under the nearby state municipality and the state municipal act. 4. The military area stays with the armed forces.

• Elections: cantonment board elections have been put off again and again. Check the latest Ministry of Defence or PIB release before the exam.

7. Special-purpose agencies (SPAs)

• Definition: a special-purpose agency is a body that does one job. It is created by a state act or a government order.
• Examples:
• housing boards
• water supply and sewerage boards, e.g. Delhi Jal Board and BWSSB (Bangalore Water Supply and Sewerage Board)
• pollution control boards
• development authorities, e.g. bodies that plan land use in a city

• Smart City SPVs (special purpose vehicles, set up from 2015 under the Smart Cities Mission and registered as companies under the Companies Act)

• Who they answer to: state departments, not the elected city council. They work on their own and are not under the council's control.

• Effect: they cut into the space of the elected municipality. The accountability problem is covered in §11 of the parent note.

8. Comparison at a glance

Body	Legal base	Elected?	Controlled by
Notified area committee	State municipal act plus notification	No, fully nominated	State government
Town area committee	Separate state act	Wholly or partly	State government
Industrial township	Art. 243Q(1) proviso plus state act	No elected council	Industrial establishment or state industrial body
Major port authority	Major Port Authorities Act 2021	No	Union (Ministry of Ports)
Cantonment board	Cantonments Act 2006	Partly	Union (Ministry of Defence, through DGDE)
Special-purpose agency	State act, order or Companies Act	Usually no	State department

Prelims Hooks

• Art. 243Q(1) proviso: the Governor, by public notification, can declare an urban area an industrial township. No municipality then needs to be set up there [7].
• In a notified area committee, all members, including the chairperson, are nominated. In a town area committee, members are wholly or partly elected.
• The Cantonments Act 2006 replaced the 1924 Act. Cantonments are run by the Ministry of Defence, not by state governments or MoHUA.
• The Officer Commanding the station is the ex officio president of a cantonment board. The CEO comes from the IDES [5].
• Cantonment categories: I above 50,000, II 10,001–50,000, III 2,501–10,000, IV up to 2,500 [5].
• 62 cantonments in 19 states (MoD, 2023). Khas Yol (HP) was de-notified on 27 April 2023 [2].
• The Major Port Authorities Act 2021 replaced the Major Port Trusts Act 1963. The Adjudicatory Board replaced the Tariff Authority for Major Ports [3].
• Trap: "Cantonment boards are municipalities under Part IXA." False. They are created by a central law, not under Art. 243Q.
• Trap: "Smart City SPVs answer to the municipal council." False. They are companies that answer mainly to the state and the Union.

Mains Points

• Democratic deficit:
• In NACs, industrial townships and cantonment boards, citizens have little or no elected local voice.
• This goes against the aim of the 74th Amendment, which was self-government through elected bodies.

• Industrial townships make good services possible, but at the cost of the vote.

• Cantonment reform as cooperative federalism (the Union and the states working together):

• Merging civil areas with municipalities brings the same laws for residents and ends the dual system left over from British rule.

• But each merger needs state agreement [2]. Election delays and questions over who gets defence land are hard points to settle.

• Too many bodies:

• Special-purpose agencies such as water boards, development authorities and Smart City SPVs take over functions listed in the Twelfth Schedule (the list of subjects that can be given to municipalities).

• Responsibility is spread across many bodies. The usual fix suggested is to bring them under the mayor and council, or set up metropolitan coordination.

• Turning NACs into nagar panchayats:

• This brings these towns in line with Art. 243Q and 243R.
• Large-scale conversion still needs fresh delimitation (redrawing of wards), reservation of seats, and money from the State Finance Commission.