1. The petitioners are authorised retail distributors in terms of the Kerala Rationing Order 1966, issued by the Government of Kerala in exercise of authority under the Essential Commodities Act, 1955. By the impugned notice, they are required by the Municipality to take licence in terms of Section 447 of the Kerala Municipality Act, 1994. They challenge this on the ground that there is no quid pro quo for the fee being levied as licence fee and no special benefit to the payer is provided on payment of the fee prescribed for such licence. The decision of the Apex Court in The Corporation of Calcutta & Another v. Liberty Cinema [AIR 1965 SC 1107] and the decision of the Division Bench of this Court in Jeevaraja v. Commissioner, Badagara Municipality [1973 KLT 845] are pressed into service.

2. Learned counsel for the petitioner further argued that the activity in a rationing shop

does not amount to trade since there is neither any profit motive nor any profit generation by the authorised retail distributors who get only a commission on the basis of the rationed articles distributed through his depot and that the process of activities in the retail rationing shop is only the end exercise of the governmental mechanism of reaching out rationed articles to those entitled to provision of ration in terms of the Rationing Order. Accordingly, it is argued that in the absence of such activity being classifiable as a trade, it is impermissible to make imposition of any fee or to have an insistence that the authorised retail distributors should have licence in terms of Section 447 of the Municipality Act.

3. Per contra, the learned counsel for the Municipality as also learned Government Pleader argued that, though rationing shops are established and controlled by the Government aimed at providing ration articles to the card holders, the activity in a rationing shop is nothing but a trade. It is also pointed out that notwithstanding the manner in which sub section (1) of Section 447 of the Municipality Act is couched, by now, it is categorically stated by the Division Bench of this Court in Sivadasan v. Mattannur Municipality [2008 (4) KLT 684] that notwithstanding that no rules have been made in that behalf by the issuance of a notification, the Municipality is entitled to insist on licence for any trade in terms of Section 447(1) of the Municipality Act. Learned counsel for the Municipality also refereed to the decision of this Court in V.Stanunathan, Health Inspector v. A.A.Aziz [1967 KLT 646], wherein, it was held that a person holding licence under the Kerala Kerosene Control Order, 1965, one issued under the Defence of India Rules, 1962, is bound to take licence under the municipal laws.

4. As noticed earlier, settling the then existing controversy, the Division Bench laid down in Sivadasan (supra) that even if no rules are notified covering any special trade, licence under Section 447(1) is obligatory. That position notwithstanding, it needs to be considered whether the activity of an authorized retail distributor, so appointed under the rationing order, amounts to trade. Learned Government Pleader points out that even this issue is no more res integra as this Court, in Assistant Labour Officer v. Muraleedharan [1990(1) KLT 252], has held that a ration shop falls within the definition of "shop" for the purpose of the Kerala Shops and Commercial Establishments Act, 1960, which includes a premises where any trade is carried on. This Court had analysed the provisions of the Rationing Order in that judgment and had held that a

rationing shop is a premises where trade or business is carried on and rationed articles are being distributed through these shops and the customers pay the price of the rationed articles.

5. Adverting to the provisions in clauses 29(1) of the Rationing Order, it can be seen that the authorised retail distributor is duty bound to supply rationed articles to the card holders on demand and offer of price by