Congress ministries came into being in 1937 in a number of states and so the annual Congress meeting was not held that year. Though the central administration continued to be what it was till then, in states where the Congress came to power, there was a general feeling that the people had become responsible for the running of the states. 

In the new constitution, India was defined as a federation and this was not acceptable officially by the Congress. However, the Congress rule in the states could be construed as a co-operation with the British Government.

But the question remained that the Congress rule in states had not improved the fate of the farmers, nor was it able to control the police from misbehavior, nor were the zemindars forced to be humane in their dealings with the people. A general feeling of dissatisfaction in the Congress rule proved to be contagious and a section of the party began to move away to more radical a pathway.