Q. Consider the following statements:
1.Fiscal federalism refers to fiscal relations between judiciary and the central government.
2.Article 246, Article 246A and the Seventh Schedule of the Constitution delineate taxation powers between the Centre and the States. 
3.The President of India establishes a Finance Commission after every five years under Article 280 of the Constitution. 
Which of the statements given above are correct?

[A] 1 and 2 only

[B] 2 and 3 only

[C] 1 and 3 only

[D] 1, 2 and 3

Answer: B

Explanation –

Statement 1 is incorrect. Fiscal federalism refers to fiscal relations between various government units, which in the Indian context means the Union Government and the State Governments.

Statement 2 and 3 are correct. Article 246, Article 246A and the Seventh Schedule of the Constitution delineate taxation powers between the Centre and the States. The President of India establishes a Finance Commission after every five years under Article 280 of the Constitution.

Source: ForumIAS