How does the Finance Commission allocate the share of these proceeds for each level of Panchayat?
The Finance Commission allocates the share of these proceeds for each level of Panchayat by reviewing their financial position and making recommendations to the Governor as to:

(a) the principles which should govern the distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls and fees levied by the State, which may be divided between them under this Part and the allocation between the Panchayats at all levels of their respective shares of such proceeds;
(b) the determination of the taxes, duties, tolls and fees which may be assigned to, or appropriated by, the Panchayats; and
(c) the grants-in-aid to the Panchayats from the Consolidated Fund of the State.