Coming to the subject, the Report of July 1947 which is before the House is in my opinion, already out of date for two reasons. The first reason is that the Indian Independence Act was passed after the Report had been drawn up, and the second reason is that towards the end of July certain decisions were taken by the Government of India and the States which led to the accession of a large number of States and to the execution by them of Instruments of Accession and Standstill Agreements. The Report before the House, Sir, does not take into account fully the changes that have been brought about since it was first written. Even as regards the subjects to be dealt with in the Federal Legislative List, an obvious difference has to be observed between the Provinces and the States. The States have acceded in respect of three subjects only, while, as I understand it, the Provinces are willing to surrender to the Centre a number of other subjects for not only laying down the law or regulating the policy, but also for administration. The expenditure of the Centre on the three subjects in respect of which the Indian State acceded to the Dominion or are likely to accede to the Federation in the future, will cost, let us say, a certain amount. In addition the Centre will have to spend a large sum of money on other subjects for the benefit of the provinces alone. Therefore, Sir, the determination of the items of taxation which should be imposed in order to enable the Centre to meet its expenditure is a little premature. The States obviously are not to be made to pay for the expenditure on subjects in respect of which they do not get any benefit.
