Judgment :- 1. There are six petitioners in O. P. No. 354 and ten in O. P. No. 790. They are engaged in the business of soaking coconut busks within the area of the Kadalundi Panchayat, the second respondent to these writ applications. The question raised in these writ applications is about the validity of the impost of a licence fee in relation to the business of soaking coconut husks and being a common question we are disposing of the petitions by a common judgment. 2. The statutory provisions pursuant to which the fee is insisted upon are contained in S.96 and 109 of the Kerala Panchayats Act, 1960. We may read these sections. "Purpose for which places may not be used without a licence The Panchayat may with the previous approval of the Director notify that no place in the Panchayat area shall be used for any of the purposes specified in the rules made in this behalf being purposes which in the opinion of Government, are likely to be offensive or dangerous to humanlife or health or property, without a licence issued by the executive authority and except in accordance with the conditions specified in such licence: Provided that no such notification shall take effect until the expiry of sixty days from the date of its publication. 109. General provisions regarding licences and permissions. (1) Save as otherwise expressly provided in, or may be prescribed under, this Act, every application for any licence or permission under this Act or any rule, bye-law or regulation made thereunder or for the renewal, thereof, shall be made not less than thirty and not more than ninety days before the earliest date with effect from which, or the commencement of the period (being a year or such less period as is mentioned in the application) for which the licence or permission is required. (2) Save as otherwise expressly provided in, or may be prescribed under, this Act, for every such licence or permission fees may be charged on such units and at such rates as may bo fixed by the Panchayat with the approval of the Director." Sub-sections (3) to (12) of S.109 are not material for the purpose of disposing of these writ petitions in the view that we have taken of the case and are therefore not read. 3. 3. The Kerala Panchayats (Licensing of Dangerous and Offensive Trades and Factories) Rules, 1963 has provided in R.3 thereof that the Government may specify in Schedule I to these Rules the purposes which in their opinion are likely to be offensive or dangerous to human life or health or property and item 28 of Schedule I to the Rules reads thus: Coconut husks and cadjan leaves Soaking of". 4. The rules do not prescribe a maximum or a minimum in relation to the fee that is chargeable for the activity specified as soaking of husks and cadjans within the Panchayat area. Apparently pursuant to the provisions in S.109 (2), the Panchayat concerned has charged fees for this particular activity. The fee is provided under item 28 and it is stated to be an annual fee of Rs. 3/-per cent. This indicates that the fee is computed on the basis of the extent of the land utilised for the purpose of retting coconut husks. 5. Counsel for the petitioners have raised various points in these writ applications. It is unnecessary to go into many of these points, for from the counter affidavits that have been filed by the Panchayat concerned as well as the State Government it is clear that the levy of fees is sought to be supported only on the basis of the services said to have been rendered which, they contend, forms quid pro quo for the levy of the fees. 6. It is contended by the petitioner that the levy cannot be supported on this basis. Reliance has been placed on the specific averment that have been made is Para.4 (e) in each of the affidavits in support of the petitions. That sub-paragraph is in these terms: "4 (e) Whether a tax or a fee. the impugned levy is arbitrary and capricious, is a restraint on the freedom of vocation and amounts to confiscation of property otherwise than in accordance with law. The levy is imposed on the area of land used irrespective of the nature of land. The number of husks that could be retted in one cent of land varies from 250 to 1000 depending upon the level of land. The levy is imposed on the area of land used irrespective of the nature of land. The number of husks that could be retted in one cent of land varies from 250 to 1000 depending upon the level of land. The cost of retting also varies from land to land depending upon transport facilities so also the quality of the retted busks depending upon the degree of salinity of water, presence or otherwise of tides and inflow and outflow of water. The price of retted husk is Rs. 50/- at present and that of raw husk is Rs. 40/-. Already a tax of 50 paise percent of land is paid to the Government. The cost of retting including wastage comes to about Rs. 8/-per thousand and the margin is only Rs. 2/-at the present price level. So even assuming the best land is used the profit margin is only Rs. 2/- and that amount is not sufficient to pay the licence fee of Rs. 3/ ." 7. The only answer to this averment is contained in Para.5 of the counter-affidavit filed by the Panchayat which we may extract: "The grounds mentioned in para 4 are not tenable. In any case, they do not affect the bye-laws and the imposition of licence fees made by the Panchayat. There is no excessive delegation " 8. Though in Para.9 of the affidavit filed on behalf of the State it is asserted that the number of husks that could be retted in one cent of land varies from 2500 to 5000 and that therefore the figures shown in ground E are not correct and hence not acceptable, it is stated even this is not sufficient to dislodge the conclusion that seems to be inevitable that the fixation effected is arbitrary and has no relation to.the services rendered. In other cases, for instance in the case of the municipality of Tellicherry, the fee fixed is Rs. 5/-a year irrespective of the extent of the land on all those who are engaged in the business of retting coconut husks. 9. Whatever that be, we are not satisfied that the Panchayat, the second respondent has applied its mind to the rate of fee that should be charged. 5/-a year irrespective of the extent of the land on all those who are engaged in the business of retting coconut husks. 9. Whatever that be, we are not satisfied that the Panchayat, the second respondent has applied its mind to the rate of fee that should be charged. We therefore hold that the resolution passed by the Panchayat in regard to this particular matter with which we are concerned in these Original Petitions, namely, the fixing of fees for retting coconut husks within the panchayat area, is unsustainable. 10. In the light of the above, we direct that no demand will be made on the petitioners for licences for the years 1966-1967 and 1967-1968 pursuant to the resolution passed by the Panchayat fixing Rs. 3/-per cent of land used for coconut husks. We however make it clear that nothing said in this judgment will preclude the Panchayat from investigating the matter afresh and passing a fresh resolution charging such fee as they think reasonable subject to the right of the aggrieved to challenge such fixation, if grounds exist, in appropriate proceedings. 11. These Original Petitions are ordered on the above terms. There will be no order as to costs. Allowed.