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Which body conducts the election of Panchayats and Municipalities?

Answer
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Hint:
A municipality is typically a single administrative division that as established by national and regional laws to which it is subordinate, has corporate status and self-government or jurisdiction powers. It should (usually) be separated from the district, which may include rural areas or various small communities such as towns, villages and hamlets.

Complete Answer:
 The responsibility of conducting free, fair and impartial elections for local bodies in the state has been assigned to the State Election Commission. Free and fair elections constitute the cornerstone of a democratic society. In India, the constitution provides for the safeguarding of free and fair elections by the Election Commission of India and the State Election Commissions of each state and grants them certain constitutional guarantees to ensure their autonomous functioning.

Article 243K(1) states that a State Election Commission composed of a State Election Commissioner to be appointed by the Governor shall be responsible for the supervision, direction and regulation of the preparation of the electoral rolls for and the conduct of all elections to the Panchayats.
Article 243K(2) states that according to the law of the state legislature, the tenure and appointment will be directed. However, except in the same way and on similar grounds as a High Court Judge, the State Election Commissioner shall not be suspended from his/her office.

Note:
For each State / Union Territory, the State Election Commissions established under the Constitution (Seventy-third and Seventy-fourth) Amendments Act, 1992 are vested with the powers of conducting elections to the Corporations, Municipalities, Zilla Parishads, Panchayats District, Panchayat Samitis, Gram Panchayats and other local bodies. They are independent of India's Election Commission.