(1)The Governor shall, on the basis of recommendation of the Finance Commission-(i)distribute between the State Government and the Municipalities the net proceeds of the taxes, duties, tolls and fees which the State levy and collect ; and(ii)allocate between the Municipalities their respective shares of such proceeds.(2)While distributing or allocating shares of such proceeds to a Municipality the Governor shall take into consideration the gross sum collected in the Municipality area, the cost of collection and the municipal obligations and the performance of the Municipality.
