1. The Executive Authority of the Wadakkancherry Panchayat has filed this appeal against the order of the Second Class Magistrate of Talappilly acquitting the accused who is the Managing Director of the Wadakkancherry Industrials (Private) Ltd. He was prosecuted for an offence under S.104 read with S.80 of the Travancore-Cochin Panchayat Act (Act II of 1950) for failure to take out a licence for the year 1959-60 for using machinery for an industrial purpose, namely, manufacture and sale of tiles and bricks. Admittedly no licence fee had been paid as demanded and no licence has been obtained.

2. S.80 of the Act provides that with the previous approval of the Director, the Panchayat may notify that no place within the limits of 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 human life or health or property, without a licence from the executive authority and except in accordance with the conditions specified therein. S.56 (2) empowers the Panchayat to levy a fee for the issue of the licence. The plea of the accused is that the Panchayat has no right to levy a tax and if in the guise of collecting a licence fee, a demand is made for payment of a tax, the accused is not bound to pay the amount and obtain the licence and failure to take out a licence would not be an offence. The learned Magistrate accepted the contention and acquitted the accused on the ground that what was sought to be levied was really a tax and not a licence fee and the action of the Panchayat was, therefore, ultra vires and beyond their powers.

3. The first question that arises for decision is whether an accused who is prosecuted in a criminal court for failure to take out a licence for conducting a trade which requires a licence, can put forward the plea that the amount claimed is excessive and go on conducting the trade without a licence. The learned Advocate-General and the learned counsel for the appellant-Panchayat have argued that whoever uses a place for a prohibited trade without a licence, contravenes the provisions of the Act and it is not open to him when he is prosecuted to contend that he is not guilty because the amount claimed by the panchayat is excessive. The learned counsel for the accused, on the other hand would contend that no tax shall be levied or collected except by authority of law, that what is demanded in this case is tax, that for conducting a trade no tax could be levied and that they are bound to pay only a licence fee and that the action of the panchayat in demanding a tax is ultra, vires and illegal and the accused could ignore the demand and conduct his trade and it is open to the court when such a person is prosecuted to find out whether the order of the statutory board demanding tax for conducting a trade is made with or without jurisdiction and whether on the face of it the demand is not illegal as violating the provisions of the Constitution which guarantees freedom to practice any profession or to carry on any occupation, trade or business. The learned counsel would argue that the action of the executive authority in this case was a wrong exercise of the power vested in him and therefore the order demanding the tax need not be taken note of and can be considered as non est. In such a case it is contended, it is not obligatory on the party to exhaust the remedies provided in the Act before transgressing the order, which according to them, is wrong or illegal.

4. I have been referred to a few cases which have taken the view that the criminal court cannot go into the question whether refusal of licence is proper or not.

In Krishnaswami in re AIR. 1925 Mad. 476, where an accused was prosecuted for having contravened S.166 (1), Local Boards Act, for having plied his motor car without a licence, after the same was refused to him and the order of refusal was communicated, it was