<Li> Local body grants, as recommended by the Central Finance Commission </Li> <Li> Funds for implementation of centrally sponsored schemes </Li> <Li> Funds released by the state governments on the recommendations of the State Finance Commissions </Li> <P> In the history of Panchayati Raj, in India, on 24 April 1993, the Constitutional (73rd Amendment) Act 1992 came into force to provide constitutional status to the Panchayati Raj institutions . This act was extended to Panchayats in the tribal areas of eight states, namely: Andhra Pradesh, Gujarat, Himachal Pradesh, Maharashtra, Madhya Pradesh, Odisha, and Rajasthan beginning on 24 December 1996 . Currently, the Panchayati Raj system exists in all states except Nagaland, Meghalaya, and Mizoram, and in all Union Territories except Delhi . </P>

Importance of panchayati raj system in rural india