Abolition of Privy Purses

Abolition of Privy Purses

According to Article 291 and 362 of the Indian Constitution, Privy Purse is a fixed, tax-free amount guaranteed to the former princely rulers and their successors. The sum was intended to cover all expenses of the former ruling families, including those incurred for religious and other ceremonies, and would be charged on the Consolidated Fund of India. Privy Purses were determined by several factors such as the state’s revenue, whether the state had been ranked as a salute state under the British Raj or not, the antiquity of the dynasty, and so on, which resulted in approx ¼ of their earlier earned revenue.

In 1947 there were more than 560 such princely states in India, over which the British Crown had suzerainty but not sovereignty. By the Indian Independence Act 1947 the Crown abandoned its suzerainty, leaving the rulers of the states free to choose to accede either to India or to Pakistan or to remain fully independent. Most had been so dependent on the Government of India that they had little choice about accession. By the eve of independence, most of the nonMuslim states had signed Instruments of Accession to India, but only one to Pakistan. Only a few states held out for complete independence after the British left India. Due to the diplomacy of Vallabhbhai Patel and VP Menon, Travancore, Bhopal and Jodhpur signed the Instruments of Accession before 15 August 1947. Even after independence three states vacillated, namely Jammu-Kashmir, Junagadh and Hyderabad which were integrated later.

The Instruments of Accession needed the states to only cede defense, communications and foreign relations to India. Democratic institutions were introduced in these states and it was only in 1949 that they were fully merged with India to form new states. Thus Travancore, Ambliara, and Cochin merged into India and formed the new state of Thiru-Kochi. Although in 1947 the royal families had been allowed to retain large sums of money as their Privy Purse, in 1949 with the states and its revenues being entirely taken over by the Government of India, it was the Indian Government that provided the rulers and their families with Privy Purses that were determined by several factors such as the state’s revenue, whether the state had been ranked as a salute state under the British Raj or not, antiquity of the dynasty, and so on.

As defined from 1949 under Article 291 of the Indian Constitution, a privy purse would be a fixed, tax-free sum guaranteed to the former princely rulers and their successors. The sum was intended to cover all expenses of the former ruling families, including those incurred for religious and other ceremonies, and would be charged on the Consolidated Fund of India. With India remaining a member of the sterling area post-Independence and with the Indian rupee remaining pegged to the British pound sterling, the privy-purse payments constituted a significant outlay of government funds4 and Article 362 of the Indian constitution deals with rights and privileges of rulers of Indian states5 . The quantum of the ‘privy purses’ ranged from Rs 5,000 per annum to Rs 26 lakh per annum. States such as Mysore (26 lakh), Hyderabad (20 lakh), Travancore (18 lakh), Jaipur (18 lakh) and Patiala (17 lakh) were amongst the highest recipients, while several small princely States got amounts as low as Rs 5,000 annually. Payments of ‘privy purse’ to the former rulers were often questioned as a relic of the past.

Attempts were made to do away with this system of payment. The motion to abolish the ‘privy purse’ system in India and the official recognition of the titles was brought before Parliament in 1969 and passed in the lok Sabha. But it did not get the required two-third majority in the Rajya Sabha, 149 voted for it and 75 against. The abolition of ‘privy purse’ had to wait till 1971 and was successfully passed as the 26th Amendment to the Constitution of India in 1971. The then Prime Minister, Indira Gandhi, argued the case for abolition based on equal rights for all citizens and the need to reduce the Government’s revenue deficit. The Constitutional Amendment recorded the following as its objectives and reason:-“The concept of rulership, with privy purses and special privileges unrelated to any current functions and social purposes was incompatible with an egalitarian social order. The Government, therefore, decided to terminate the privy purses and privileges of the rulers of former Indian States. It was necessary for this purpose, apart from amending the relevant provisions of the Constitution, to insert a new article therein so as to terminate expressly the recognition already granted to such rulers and to abolish privy purses and extinguish all rights, liabilities and obligations in respect of privy purses.

In accordance with the Constitution (Twenty-sixth Amendment) Act, 1971, The article 361B says that a prince, Chief or other person who, at any time before the commencement of the Constitution (Twenty-sixth Amendment) Act, 1971, was recognized by the President as the Ruler of an Indian State or any person who, at any time before such commencement, was recognized by the President as the successor of such ruler shall, on and from such commencement, cease to be recognized as such Ruler or the successor of such Ruler. This article also mentions abolition of Privy Purse8 . Through this article on Privy Purse I want to conclude that it is worthwhile examining whether we have actually done away with this practice or not. In this context, it is also worth examining whether our new democratic rulers enjoy such privileges or not. What are the perquisites attached to a retiring Prime Ministers, Presidents etc.

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