Explanation:

The Charter Act of 1793, also known as the East India Company Act 1793 was passed in the British Parliament in which the company charter was renewed. The Charter Act of 1793 put the municipal institutions on a statutory basis. Hence statement 3 is correct.
? The Governor-General was empowered to appoint Justices of Peace in the presidency towns. These Justices of Peace were given powers to levy taxes on houses arid lands to meet the cost of police, scavenging, and repair of roads.
? A house tax at the rate of 5% of the rental value was imposed in the presidency towns. Between 1840 and 1853 the rate-payers were given the right to elect members of corporations, but the process was reversed in 1856 when all executive power, in the Bombay town, was concentrated in the hands of a nominated commissioner. A similar procedure was followed in Madras and Calcutta. Further attempts to introduce the elective element were made in 1872, 1876, and 1878.
? With the coming into force of the Government of India Act 1919 local self-government became a 'transferred' subject under popular ministerial control.
? The Government of India no longer issued any instruction to provincial governments and each province was allowed to develop local self-institutions according to provincial needs and requirements. Hence statement 1 is not correct.
? Under the Scheduled Taxes Rules, the taxes which could be imposed by local bodies were separated from those which fell within the competence of provincial governments. The Indian
ministers, however, could not do much work in the sphere of local self-government for lack of funds, since finance was a 'reserved' subject under the charge of an Executive Councillor.
? The Simon Commission reporting in May 1930 referred to the wide financial powers exercised by local bodies. It, however, observed that village panchayats had not shown any marked progress except in the U.P. Bengal and Madras. The Commission suggested the retrograde step of increasing the control of provincial governments over local bodies in the interest of greater efficiency and quoted the example of England where “numerous administrative devices, by inspection, by audit, by the giving of grants-in-aid on conditions ensuring efficiency. Hence statement 2 is not correct.