Recovery of loans and advances made by the Government

Recovery of loans and advances made by the Government (1) Notwithstanding anything in the Local Authorities Loan Act, 1914 (Central Act 9 of 1914), or any other law similar thereto for the time being in force, the Government may- (a) by order direct any person having custody of the gram panchayat fund to pay to them in priority to any other charges against such fund, except charges for the service of authorised loans, any loan or advance made by them to the gram panchayat for any purpose to which its funds may be applied under this Act; (b) recover any such loan or advance by suit. (2) The person to whom the order referred to in clause (a) of sub-section (1) is addressed shall be bound to comply with such order.