73rd Panchayati Raj Act came into existence in 1993 and it paved the way for a strong and effective decentralized administrative system in India. The Indian Constitution added 11th schedule to it detailing 29 subjects which are devolved to the local self-government institutions [LSGIs]. It is nearly two decades passed and still LSGIs are hesitant to adapt with their roles to develop them as self-sufficient administrating regions. The devolved function is not fully exercised by the LSGIs. The transferred the departments connected with the 29 subjects are still working in a bureaucratic manner. This study reveals the real reasons behind the poor performance of LSGIs and coming up with a technological solution to overcome the problem through an interactive E-Governance system. Even though 29 subjects are given to the LSGIs, 4 departments are considered in this research due to time constrains.