Section 3: Constitution of a State Finance Commission.

(1) The State Government shall, as soon as may be within one year from the commencement of this Act and thereafter at the expiry of every filth year, constitute a body to be known as the Meghalaya State Finance Commission to review the financial position of the Traditional Bodies, Municipalities or Municipal Boards notwithstanding any term by which urban local bodies are called in the State and also the Autonomous District Councils as the State Government may deem it necessary and to make recommendations as to - (a) the principles which should govern- (i) the distribution between the State and the Traditional Bodies, Municipalities or Municipal Boards or the Autonomous District Councils of the n~t proceeds of the taxes, duties, tolls and fees leviable by the State, which may be divided between them to enable these bodies to perform . the functions assigned and whic1:;l may be assigned to it under any laws in force or orders and the allocation between the Traditional Bodies, Municipalities and the Autonomous District Councils at all levels of their respective shares of such proceeds; (ii) the determination of the taxes, duties, tolls and fees which may be assigned to or, appropriated by the Traditional Bodies, Municipalities and the Autonomous District Councils; (iii) the grant-in-aid to the Traditional Bodies, Municipalities and the Autonomous District Councils from the Consolidated Fund of Meghalaya; (b) the measures needed to improve the mancial position of the Traditional Bodies, Municipalities and the Autonomous District Councils; (c) any other matter. referred to the Commission by the State Government in the interests of sound finances of the Traditional Bodies, Municipalities and the Autonomous District Councils; and (d) any other matter referred to the Commission by the State Government in the interest of the effective implementation of responsibilities required to be undertaken by the Village Durbars, Municipalities and Autonomous District Councils. (2) The State Government shall cause every recommendation made by the Commission under this section together with an explanatory memorandum as to the action taken thereon to be laid before the State Legislature.