Consider the following statements:
1. The 73rd Amendment Act left the issue of devolution of financial powers to the discretion of the state legislatures
2. The state legislatures are empowered to dissolve the Panchayats on certain grounds
Which among the above statements is / are correct?

Answer: [C] Both 1 & 2 are correct

73rd Constitution Amendment Act had only made holding of regular elections for the civic bodies mandatory. It had, however, left the issue of devolution of financial powers to the discretion of the state legislatures. Article 243-E, Article 243-E makes provisions about the duration of the Panchayats. As per this  article, a clear term for 5 years has been provided for the Panchayats and elections must take place before the expiry of the terms. However, the Panchayat may be dissolved earlier on specific grounds in accordance with the state legislations. In that case the elections must take  place before expiry of 6 months of the dissolution.

This question is a part of GKToday's Integrated IAS General Studies Module