Part XII - Finance & Property • Article

Article 273 Simplified: Grants in lieu of export duty on jute and jute products

Article 273 provided temporary compensatory grants-in-aid to the jute-growing states of Assam, Bihar, Odisha, and West Bengal in lieu of sharing export duties on jute. In line with the sunset clause, these grants expired in 1960 (ten years from the Constitution's commencement).

Official Text

(1) There shall be charged on the Consolidated Fund of India in each year as grants-in-aid of the revenues of the States of Assam, Bihar, [Odisha] and West Bengal, in lieu of assignment of any share of the net proceeds in each year of export duty on jute and jute products to those States, such sums as may be prescribed. (2) The sums so prescribed shall continue to be charged on the Consolidated Fund of India so long as any export duty on jute or jute products continues to be levied by the Government of India or until the expiration of ten years from the commencement of this Constitution whichever is earlier. (3) In this article, the expression “prescribed” has the same meaning as in article 270.

Simple Meaning

Explain Like Ten

When India became independent, some states that grew a lot of jute (used to make bags and ropes) lost their export tax money to the central government. The center gave them a temporary compensation grant for ten years, which ended in 1960.

Student Mode

Article 273 mandated grants-in-aid in lieu of a share in the export duty on jute and jute products to Assam, Bihar, Odisha, and West Bengal. Under Clause (2), these grants were charged on the Consolidated Fund of India for a limited duration: either as long as the export duty was levied, or for ten years from the commencement of the Constitution (which ended in 1960), whichever was earlier.

Example

During the 1950s, the export duties collected on jute by the Union were compensated by paying Bihar and West Bengal a compensatory grant under Article 273. These payments ceased permanently in 1960.

Key Takeaway

Article 273 provided temporary transitional grants for jute-producing states which expired in 1960.

FAQs

Why did only four states receive grants under Article 273?

Because Assam, Bihar, Odisha, and West Bengal were the primary jute-growing and jute-exporting states during the pre-independence era.

Are these jute grants active today?

No. As per the constitutional sunset clause, they expired in 1960 (ten years after the commencement of the Constitution).

Quiz

Which of the following states received compensatory grants under Article 273?

Answer: West Bengal

For how long were the grants under Article 273 constitutionally mandated to continue?

Answer: Maximum of 10 years from the commencement of the Constitution