The Union Cabinet, at a meeting chaired by Prime Minister Manmohan Singh, discussed the report of Jharkhand Governor Syed Ahmed who has favoured imposition of President's rule while keeping the 82-member state Assembly in suspended animation.
The Cabinet decided to accept the Governor's recommendation and refer the matter to the President for necessary action, a minister, who attended the meeting, said.
The Governor's recommendation was made in his second report to the Centre on the political situation in the wake of Munda's resignation. The Chief Minister had sought dissolution of the Assembly after ally Jharkhand Mukti Morcha withdrew support to his government.
Jharkhand, which was created in 2000, has been placed under President's rule twice.
The present political instablity erupted on January 8 when BJP's ruling coalition partner JMM, in a letter to the Governor, formally withdrew its support to the 28-month-old government pushing it into a minority.
In the Assembly, BJP and JMM have 18 members each. The Munda government had the support of six members of All Jharkhand Students' Union, two of JD (U), two independents and one nominated member who has voting right in a trial of strength.
Opposition Congress has a total of 13 members, Jharkhand Vikas Morcha(P)11 and RJD 5 in the assembly. CPI-ML(L), Marxist Coordination Party, Jharkhand Party (Ekka), Jharkhand Janadhikar Manch and Jai Bharat Samta Party have one member each besides an independent.