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Part-5 |
Structure of State and Distribution of State Power |
56. Structure of State : (1) The main structure of the Federal Democratic Republic |
of Nepal shall be of three levels, namely the Federation , the State and the Local |
level. |
(2) The Federation , State and Local l evels shall exercise the power |
of State of Nepal pursua nt to this Constitution and law . |
(3) There shall be States consisting of the Districts as mentioned in |
Schedule -4 existing in Nepal at the time of commencement of this |
Constitution. |
(4) There shall be Village Institutions , Municipalities and District |
Assemblies under the Local level. The number of Wards in a Village |
Institution and Municipality shall be as provided for in the Federal law. |
(5) Any Special, Protected or Autonomous Region can be set by the |
Federal law for social, cultural protection or economic developme nt. |
(6) The Federation , State and Local levels shall protect Nepal's |
freedom, sovereignty, territorial integrity, independence, national interest, |
overall development, multi -party, competitive, democratic, republican, federal |
system of governance , human ri ghts and fundamental rights, rule of law, |
separation of powers and check and balance, egalitarian society b ased on |
pluralism and equality, inclusive representation and identity. |
57. Distribution of State power : (1) The powers of the Federation shall be ves ted in |
the matters enumerated in Schedule -5, and such powers shall be exercised |
pursuant to this Constitution and the Federal law. |
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(2) The powers of a State shall be vested in the matters enumerated |
in Schedule -6, and such powers shall be exercised pursuant to this Constitution |
and the State law. |
(3) The concurrent powers of the Federation and the State shall be |
vested in the matters enumerated in Schedule -7, and such powers shall be |
exercised pursuant to this Const itution, the Federal law and the State law. |
(4) The powers of the Local l evel shall be vested in the matters |
enumerated in Schedule -8, and such powers shall be exercised pursuant to this |
Constitution and the law made by the Village Assembly or Municipal |
Assembly. |
(5) The concurrent powers of the Federation, State and Local l evels |
shall be vested in the matters enumerated in Schedule -9, and such powers shall |
be exercised pursuant to this Constitution , the Federal law, the State law and |
the law made by the Village Assembly or Municipal Assemb ly. |
(6) Any law to be made by the State Assembly, Village Assembly or |
Municipal Assembly pursuant to clause (3) or (5) shall be so made as not to be |
inconsistent with the Federal law, and any law made by the State Assembly, |
Village Assembly or Municipal As sembly which is inconsistent with the |
Federal law shall be invalid to the extent of such inconsistency. |
(7) Any law to be made by the Village Assembly or Municipal |
Assembly pursuant to clause (5) shall be so made as not to be inconsistent with |
the State la w, and any law made by the Village Assembly or Municipal |
Assembly which is inconsistent with the State law shall be invalid to the extent |
of such inconsistency. |
58. Residual p owers : The Federation shall have power on any matter not |
enumerated in the Federa l List, State List, List of Local level or Concurrent |
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List or on any matter which is not so specified in this Constitution as to be |
exercised by any level. |
59. Exercise of financial p owers : (1) The Federation, State and Local l evel shall |
make laws, make an nual budget, decisions, formulate and implement policies |
and plans on any matters related to financial powers within their respective |
jurisdictions. |
(2) The Federation may so make necessary policies, standards and |
laws on any of the matters enumerated in t he Concurrent List and other areas |
of financial powers as to be applicable also to the States. |
(3) The Federation, State and Local l evel shall make budget of their |
respective levels, and the time for submission of budget by the State and Local |
level sha ll be as provided for in the Federal law. |
(4) The Federation , State and Local level shall provide for the |
equitable distribution of benefits derived from the use of natural resources or |
development. Certain portions of such benefits shall be distributed, purs uant to |
law, in forms of royalty, services or goods to the project affected regions and |
local communities. |
(5) If, in utilising natural resources, the local community desires to |
make investment there in, the Federation, State and Local l evel shall accord |
priority to such investment in such portion as provided by law on the basis of |
the nature and size of such investment . |
(6) The Government of Nepal shall have power to obtain foreign |
assistance and borrow loan s. Such assistance or loan s shall be so obtained or |
borrowed as to have macro -economic stability of the country. |
(7) Provisions relating to the management of budget deficits and |
other fiscal discipline of the Federation, State and Local l evel shall be as |
provided for in the Federal law. |
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60. Distribution of sources of revenue : (1) The Federation, State and Local l evel |
may impose taxes on matters falling within their respective jurisdiction and |
collect revenue from these sources. |
Provided that provisions relating to the imposition of taxes and |
collection of revenue on matters that fall within the Concurrent List and on |
matters that are not included in the Li st of any l evel shall be as determined by |
the Government of Nepal. |
(2) The Government of Nepal shall make provisions for the equitable |
distribution of th e collected revenue to the Federation, State and Local l evel. |
(3) The amount of fiscal transfer receivable by the State and Local |
level shall be as recommended by the National Natural Resources and Fiscal |
Commission . |
(4) The Government of Nepal shall, on t he basis of the need of |
expenditure and revenue capacity, distribute fiscal equalization grants to the |
State and Local level. |
(5) Each State shall, in accordance with the State law, distribute |
fiscal equalization grants out of the grants received from the Government of |
Nepal and revenues collected from its sources, on the b asis of the need of |
expenditure and revenue cap acity of its subordinate Local l evel. |
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