Sarkaria Commission was set up in June 1983 by the central government of India. The Sarkaria Commission's charter was to examine the relationship and balance of power between state and central governments in the country and suggest changes within the framework of Constitution of India.  The Commission was so named as it was headed by Justice Ranjit Singh Sarkaria, a retired judge of the Supreme Court of India. The other two members of the committee were Shri B. Sivaraman and Dr S.R. Sen.
The Commission after conducting several studies, eliciting information, holding discussions and after detailed deliberations submitted its 1600-page final report in January 1988. The final report contained 247 specific recommendations. In spite of the large size of its reports - the Commission recommended, by and large, status quo in the Centre-State relations, especially in the areas, relating to legislative matters, role of Governors and use of Article 356.
The report contains 247 recommendations spreading over the following 19 Chapters. Chapter 0. It gave suggestions like centre should consult state before legislation on concurrent list, river water dispute tribunal award should be binding on parties three months after award is given by tribunal, and centre should make deliberate use of article 258.
Chapter I. Perspective Chapter II. Legislative Relations Chapter III. Administrative Relations Chapter IV. Role of the Governor Chapter V. Reservation of Bills by Governors for President's consideration and Promulgation of Ordinances Chapter VI. Emergency Provisions Chapter VII. Deployment of Union Armed Forces in States for Public Order Duties Chapter VIII. All India Services Chapter IX. Inter-Governmental Council Chapter X. Financial Relations Chapter XI. Economic and Social Planning Chapter XII. Industries Chapter XIII. Mines and Minerals Chapter XIV. Agriculture Chapter XV. Forests Chapter XVI. Food and Civil Supplies Chapter XVII. Inter-State River Water Disputes Chapter XVIII. Trade, Commerce and Inter-course within the Territory of India Chapter XIX. Mass Media Chapter XX. Miscellaneous Matters Chapter XXI. General Observations Chapter XXII. Appendices Chapter XXIII Conclusion
Recommendations on Appointment of Governor :
(i) should be an eminent person;
(ii) must be a person from outside the State;
(iii) must not have participated in active politics at least for some time before his appointment;
(iv) he should be a detached person and not too intimately connected with the local politics of the State;
(v) he should be appointed in consultation with the Chief Minister of the State, Vice-President of India and the Speaker of the Lok Sabha;
(vi) His tenure of office must be guaranteed and should not be disturbed except for extremely compelling reasons and if any action is to be taken against him he must be given a reasonable opportunity for showing cause against the grounds on which he is sought to be removed. In case of such termination or resignation of the Governor, the Government should lay before both the Houses of Parliament a statement explaining the circumstances leading to such removal or resignation, as the case may be;
(vii) After demitting his office, the person appointed as Governor should not be eligible for any other appointment or office of profit under the Union or a State Government except for a second term as Governor or election as Vice-President or President of India, as the case may be; and
(viii) At the end of his tenure, reasonable post-retirement benefits should be provided.
The Commission felt that the State Government should be given prominence in appointing the Governor. The appointment should be made
(1) From a panel to be prepared by the State Legislature; or
(2) From a panel to be prepared by the State Government or invariably by the Chief Minister;
The Commission felt that the Chief Minister should be consulted before appointing the Governor. For proper working of the Parliamentary system there has to be a personal rapport between the Governor and the Chief Minister.
Thus the main purpose of consulting the Chief Minister is to ascertain his objections, if any, to the proposed appointment.
The Commission found that consultation with the Chief Minister has not invariably been taking place in recent years.
The general practice, as far as the Commission has been able to ascertain, seems to be that the Union Government merely informs the Chief Minister that a certain person is being appointed as the Governor of the State. Sometimes even such prior intimation is not given.
The Commission recommended that the Vice President of India and the Speaker of the Lok Sabha should be consulted by the Prime Minister in selection of Governor. Such consultation, the Commission felt, will greatly enhance the credibility of the selection process.
Some of the recommendations have been adopted such as Governor to be from outside State.The SC has many a times emphasized the urgent need for implementing Sarkaria commission's recommendations on selection and appointment of Governors.