Telangana Government Transfers Gram Panchayat Powers to Industrial Infrastructure Corporation for Park Management

The Government of Telangana has issued two significant notifications, G.O. Ms. No. 24 and G.O. Ms. No. 25, both dated April 30, 2025, concerning the administration of Panchayat Raj. These notifications, issued by the Panchayat Raj & Rural Development Department, formalize the transfer of specific powers and functions from several Gram Panchayats to the Telangana Industrial Infrastructure Corporation Limited (TSIIC). The primary reason for this executive action is to ensure the systematic and improved maintenance of industrial parks established by TSIIC within areas that currently fall under the jurisdiction of these Gram Panchayats. The legislation came into force upon its publication in the Official Gazette on April 30, 2025.

Under the provisions of clause (i) of section 140, read with section 294 of the Telangana Panchayat Raj Act, 2018 (Telangana Act No.5 of 2018), the Government has designated TSIIC as a "Local Authority" for the specified industrial areas. This transfer encompasses a broad range of responsibilities previously held by the Gram Panchayats, including provisions related to taxation and finance (Sections 64-74), public safety, convenience, and health (Sections 75-118), general, miscellaneous, and supplemental provisions applicable to Gram Panchayats (Sections 119-140), other miscellaneous provisions (Sections 261-285), and provisions concerning rules, bye-laws, and penalties (Sections 286-297). The affected Gram Panchayats are located in the districts of Sangareddy, Medak, and Siddipet, covering various industrial parks and villages as detailed in the annexures to the notifications. A crucial aspect of this transfer is the mandated revenue-sharing mechanism, where revenue generated will be distributed between TSIIC and the concerned Gram Panchayats. For newly formed Industrial Area Local Authority areas without existing industries, the ratio is 65:35 in favour of TSIIC, while for other areas, it is an equal 50:50 split.

The legislative intent behind these notifications is to streamline the administration and upkeep of industrial parks, recognizing the specialized requirements for managing such zones. The earlier legal position saw these powers vested solely with Gram Panchayats, which, while crucial for local governance, may not possess the specific expertise or resources required for the comprehensive management of large industrial infrastructures. These notifications address potential statutory gaps and limitations in ensuring efficient industrial development and maintenance by centralizing control under a dedicated industrial development body. The transfer of powers aims to foster a more conducive environment for industrial growth by ensuring better infrastructure, public safety, and regulatory compliance within these designated areas. The legislation provided: “the Government hereby transfer the powers and functions of certain Gram Panchayats... to the control of Telangana Industrial Infrastructure Corporation Limited for systematic and better maintenance of Industrial Parks established by them... subject to the condition that, the revenue shall be shared in the ratio of 65:35 between the Telangana Industrial Infrastructure Corporation Limited and the concerned Gram Panchayats for newly formed Industrial Area Local Authority areas (where there are no existing industries) and 50:50 in others.” This move is designed to enhance the operational efficiency of industrial parks, which are vital for economic development, while simultaneously ensuring that local bodies continue to benefit from the economic activity through a structured revenue-sharing model. This mechanism aims to balance industrial development needs with the financial interests of the local Gram Panchayats, ensuring a collaborative approach to governance in these specialized zones.

Keywords: Telangana, Panchayat Raj, Industrial Parks, TSIIC, Gram Panchayats, Local Authority, Revenue Sharing, Industrial Development, Government Notification Geo Tags: Country: India, State: Telangana District: Sangareddy, Medak, Siddipet