Explanation:

The cabinet mission plan of 1946 proposed a weak Centre with Provincial autonomy – essentially proposing a federal structure of government. Union of India which was to be empowered to deal with the defense, foreign affairs and communications.
The Union Government and its legislature were to have limited powers, dealing with Finance, Foreign Affairs and Communications. The union would have powers necessary to raise the finances to manage the subjects.  All subjects other than the Union Subjects and all the residuary powers would be vested in the provinces.