Which of the following correctly explains the constitutional consequences when a local law (a Panchayat Act) conflicts with a State law on a subject in the State List?

Panchayats derive their powers from State legislation enacted under Part IX. Therefore, in case of inconsistency between Panchayat regulations and State law on a State List subject, State law prevails. However, States cannot arbitrarily undermine Panchayats in a manner that defeats the constitutional purpose of decentralization. In State of U.P. v. Pradhan Sangh Kshettra Samiti (1995), the Supreme Court recognized Panchayats as institutions of self-government but clarified that they function within the constitutional framework of State control. Judicial review remains available to prevent abuse.