ORDER.- Writ Petition No. 852 of 1969 challenges the validity of and the levy of local cess under section 115 of she Madras Panchayats Act (XXXV of 1958) (hereinafter referred to as the Act), while Writ Petition No. 853 of 1969, filed by the same petitioner challenges the levy of local cess surcharge under section 116 of the same Act. The petitioner is a ryotwari pattadar of an extent of 259.73 acres of land with reference to which the petitioner has obtained a lease or licence from the Government for mining. Similarly, in respect of another extent of land of which, admittedly the Government is the owner by different lease deeds entered into between the Government and the petitioner, the petitioner has obtained the right to mine gypsum. The petitioner was called upon to pay local cess under section 115 of the Act in respect of the lands covered by the leases granted by the Government relating to the lands of which the petitioner is a pattadar as well as the lands of which the Government is the owner, and to pay local cess surcharge under section 116 of the Act in respect of the same lands. Mr. R. Ramamurthi Iyer, the learned Counsel for the petitioner in these writ petitions, in the first place, sought to contend that section 115 of the Act, along with the Explanation is ultra vires and unconstitutional. But this argument is not open to the petitioner in view of the judgment of this Court dated 13th October, 1969, in Writ Appeal No. 464 of 1967, taking the view that the cess levied under section 115 of the Act is a cess on the land itself to be measured in terms of the land revenue, lease amount, royalty or other sum mentioned whichever may be applicable. In view of the judgment of this Court, the learned Counsel sought to argue that the quantum of the levy made under section 115 of the Act is illegal. For this purpose, it is necessary to extract section 115 (1) of the Act, along with the Explanation thereto, as amended by the Madras Act (XVIII of 1964). “Section 115 (1).- There shall be levied in every Panchayat Development Block, a local cess at the rate of 45 paise on every rupee of land revenue payable to the Government in respect of any land for every fasli. “Section 115 (1).- There shall be levied in every Panchayat Development Block, a local cess at the rate of 45 paise on every rupee of land revenue payable to the Government in respect of any land for every fasli. Explanation.- In this section and in section 116, ‘Land Revenue’ means public revenue due on land and include water-cess payable to the Government for water supplied or used for the irrigation of land, royalty, lease amount or other sum payable to the Government in respect of land held direct from the Government on lease or licence, but does not include any other cess or the surcharge payable under section 116, provided that land revenue remitted shall not be deemed to be land revenue payable for the purpose of this section.” 2. Under the main part of sub-section (1), access at the rate of 45 paise of every rupee of land revenue payable to the Government can be levied in respect of any land for every fasli. For this purpose it is necessary to separate the land of which the petitioner is pattadar from the land of which the Government is the owner. As far as the land of which the petitioner is the pattadar is concerned it is clear that the cess is payable only on the land revenue and in this context land revenue is simply the amount which the petitioner pays by way of kist to the Government. The case of the petitioner is that the cess has been calculated at the rate of 45 paise per rupee not on the land revenue payable by the petitioner to the Government, but on the dead rent or royalty payable to the Government under the mining lease and that it is illegal. It is admitted by the learned Assistant Government Pleader that the cess has been calculated at the rate of 45 paise per rupee on the dead rent of royalty and not merely on the kist payable by the petitioner to the Government. It is admitted by the learned Assistant Government Pleader that the cess has been calculated at the rate of 45 paise per rupee on the dead rent of royalty and not merely on the kist payable by the petitioner to the Government. I am of the view that the main part of the sub-section will apply to the case where the petitioner happens to he the ryotwari pattadar, and with reference to such a person the cess is payable only on the land revenue or kist, and even in a case, where a mining lease has been granted by the Government in favour of the petitioner in respect of the land belonging to the petitioner no cess can be levied with referenes to the dead rent or royalty. Consequently, the claim for payment of cess under section 115 of the Act, calculated with reference to the dead rent or royalty payable in respect of the land of which the petitioner is the ryotwari pattadar is illegal and not authorised by the language of sub-section (1) of section 115 of the Act. On the other hand, the position is entirely different with reference to the land which belongs to the Government in respect of which the petitioner has obtained a lease. To such a case, the Explanation will clearly apply, and, as per the Explanation, the expression ‘land revenue’ will include the lease amount or other sum payable to the Government in respect of land held direct from the Government on lease or licence. In regard to the land belonging to the Government, when the petitioner has obtained a lease for mining, the petitioner must be deemed to hold the land direct from the Government, and therefore, the lease amount of royalty or dead rent will constitute the land revenue in respect of which cess can be collected at the rate of 45 paise per rupee. Hence, the conclusion is inescapably that the demand for payment of cess at the rate of 45 paise per rupee on the dead rent or royalty in respect of the land of which the petitioner is the pattadar is illegal, while the same demand is legal and valid in respect of the land of which the Government is the owner. Hence, the conclusion is inescapably that the demand for payment of cess at the rate of 45 paise per rupee on the dead rent or royalty in respect of the land of which the petitioner is the pattadar is illegal, while the same demand is legal and valid in respect of the land of which the Government is the owner. However, it is admitted that a composite demand for payment of the local cess has been made on the petitioner in respect of both these categories of lands. In view of this feature, the writ petition, viz., W.P. No. 852 of 1969 has to be allowed and the demand made by the respondents herein has to be quashed. But, I may make it clear that the quashing of the demand already made will not prevent the respondents herein from making a fresh demand on the petitioner in accordance with the law, treating the two categories of land differently in the manner in which I have already indicated. Under these circumstances, the writ petition is allowed as indicated, above. There will be no order as to costs. 3. As I pointed out already, Writ Petition No. 853 of 1969 challenges the levy of local cess surcharge under section 116 of the Act, which reads as follows: "Every Panchayat Union Council may levy on every person liable to pay land revenue to the Government in respect of any land in the Panchayat Union, a local cess surcharge at such rate as may be considered suitable as an addition to the local cess levied in the Panchayat Development Block under seciton 115, provided that the rate of local cess surcharge so levied shall be subject to maximum as may be prescribed." 4. The complaint of the learned Counsel for the petitioner is that the section contemplates the prescription of the maximum by the Government, that the Panchayat Union Council can levy the surcharge only subject to the maximum, and that so long as the maximum has not been prescribed by the Government, the Panchayat Union Council has no right whatever to levy the surcharge. This argument is based on the general consideration that the taxing power is essentially a legislative function and when once that power has been delegated on a local body like the Panchayat Union Council, it could have been done only by the Legislature laying down certain guidelines for the purpose of making the actual levy, and that, in the absence of any guidelines, it is not open to the Panchayat Union Council to demand the payment of surcharge from the petitioner herein. I am of the view that this contention of the learned Counsel for the petitioner is sound. What has actually happened is that the Government have not prescribed any maximum as contemplated by the statute; on the other hand, they passed two orders, which, from the very nature of the case, were only administrative in character. The first order passed by the Government is G.O.Ms. No. 444, Rural Development and Local Administration Department, dated 18th February, 1961. This Government Order is as follows: "Under section 116 of the Madras Panchayats Act, 1958, every Panchayat Union Council may levy on every person liable to pay land revenue to the Government in respect of any land in the Panchayat Union, a local cess surcharge at such rate as may be considered suitable as an addition to the local cess levied in the Panchayat Development Block under section 115 of the said Act provided that the rate of local cess surcharge so levied shall be subject to such maximum as may be prescribed. 2. Certain Panchayat Union Commissioners have enquired whether the local cess as surcharge may be levied from the year 1961-62 onwards, and if so whether any maximum rate has been prescribed by the Government. 3. The Government have carefully examined the questions and pass the following orders: (i) Date from which local cess surcharge may be levied.- It has already been ordered in G.O. No. 1499, L.A., dated 7th September, 1960, that local cess under section 115 of the Madras Panchayats Act, 1968, should be collected on the old basis under the existing Acts during fasli 1370, i.e., for the year 1960-61 and that the provisions of the new Act should be given effect to from fasli 1371, i.e., from 1961-62. As local cess surcharge cannot be levied until the levy of local cess (in the new consolidated form) is enforced in panchayat Unions, the Government direct that the levy of local cess surcharge should commcence from fasli 1371. (ii) Maximum Rate of Levy of local cess surcharge.- The Government consider that no maximum need be prescribed for the present and that the question may be taken up some time later. Pending the fixation of the maximum rate by the Government, the local cess surcharge may be levied by Panchayat Union Councils upto 25 naye paise in the rupee of land revenue from fasli 1371." 5. Subsequently the Government passed another order in G.O.Ms. No. 868, Rural Development and Local Administration Department, dated 23rd March, 1961. That Government Order is as follows:- Read: G.O.Ms. No. 444, R.D. & L.A., dated 18th February, 1961. "Order.- In paragraph 3 (ii) of the Government Order cited it was ordered that, pending the fixation of the maximum rate of levy of local cess surcharge under section 116 of the Madras Panchayats Act, 1958, the local cess surcharge may be levied by Panchayat Union Councils upto 25 nP. in the rupee of land revenue from fasli 1371. It has been suggested that as several panchayat unions have passed resolutions levying surcharge exceeding 25nP. the limit of 25 nP. would have an adverse effect on the enthusiasm of panchayat unions in raising local resources and that it would also lead to difficulties in balancing their budgets. The Collectors are informed that, as already stated, the intention of the Government is not to prescribe the maximum rate of local cess surcharge to be levied by Panchayat Union Councils for the present but to encourage Panchayat Union Councils to exploit the powers of local taxation vested in them to the maximum extent possible and thus augment their revenues. The limit of 25 nP. specified in the Government Order represents only the average for the State. The Madras Panchayats Act, 1958, vests the discretion to levy local cess surcharge in panchayat unions subject to the maximum rate prescribed by the Government. If no maximum rate is prescribed by the Government, panchayat unions will be free to levy the surcharge at any rate they consider necessary or desirable. There is, therefore, no objection to the Panchayat Union Councils levying the local cess surcharge at a rate higher than 25 nP. If no maximum rate is prescribed by the Government, panchayat unions will be free to levy the surcharge at any rate they consider necessary or desirable. There is, therefore, no objection to the Panchayat Union Councils levying the local cess surcharge at a rate higher than 25 nP. in the rupee of land revenue, but if the Collector considers that levy at a higher rate will cause undue financial hardship to the people, he may advise the Panchayat Union Council to reduce the rate. The Collectors are requested to make known the contents of the orders to all Panchayat Union Councils". 6. From these two Government orders, it is clear that the Government have taken a deliberate decision not to prescribe the maximum as contemplated by the statute in section 116 of the Act, with a view to encourage Panchayat Union Councils to exploit the powers of local taxation vested in them to the maximum extent possible and thus augment their revenues. To say the least, this is to take a perverted view of the statutory provision actually made in this case. As I pointed out already, the taxing power is essentially a legislative power and when the Legislature enacted section 116 of the Act, vesting the power to levy surcharge on the Panchayat Union Councils, it took care to provide for certain safeguards in the form of a maximum being prescribed and the Panchayat Union Councils levying surcharge within the maximum so prescribed. Once the maximum has not been prescribed by the Government, the essential safeguard contemplated by the statute in the interests of the citizens is given the go-by and the Panchayat Union Councils are left with an arbitrary power to levy the surcharge at any rate they liked. I am of the view, that this is not what was contemplated by the statute. On the other hand, the statute expressly and definitely contemplates the prescription of a maximum subject to which alone the Panchayat Union Councils can levy local cess surcharge as contemplated by the section. The same view has been taken by Alagiriswami, J., in his judgment in Writ Petition No. 3216 of 1968, dated 3rd February, 1970, following the judgment of the Supreme Court in Mohd. The same view has been taken by Alagiriswami, J., in his judgment in Writ Petition No. 3216 of 1968, dated 3rd February, 1970, following the judgment of the Supreme Court in Mohd. Hussain v. State of Bombay1If I may say so with respect, I entirely agree with reasoning and conclusion of the learned Judge in this behalf, and following that judgment and for the reasons indicated by me above, it must be held that, in the absence of the prescription of the maximum as contemplated by section 116, the Panchayat Union Council had no jurisdiction whatever to levy the local cess surcharge on the petitioner. On this basis, this writ petition is allowed, and the demand made on the petitioner is quashed. There will be no order as to costs in this writ petition also. V.M.K. ---------- Writ petition allowed.