Effect of absorption of a part of a

.- If any part of an area within the limits of a 1[panchayat area] is included in a 1[larger urban area] , then notwithstanding anything contained in this Act or in the 1[Karnataka Panchayat Raj Act, 1993] but subject to the provisions of section 4 of this Act, with effect from the date on which such area is included in the 1[larger urban area] , the following consequences shall ensue namely:-

1. (a) so much of the 1[Grama Panchayat Fund] and other property vesting in the 1[Grama Panchayat] shall be transferred to the corporation fund as the Government may, by order in writing, direct;
2. (b) the rights and liabilities of the 1[Gramal Panchayat] in respect of civil and criminal proceedings, contracts, and other matters or things (including arrears of taxes, fees and cess) arising in or relating to the part of the area included in the 1[larger urban area] shall vest in the corporation; and such rights and liabilities may be enforced by or against the corporation under this Act or the rules, bye-laws and orders made thereunder;
3. (c) such officers and servants of the 1[Grama Panchayat] shall be transferred to the corporation as the Government may, by order, direct.

¹ Substituted by Act 35 of 1994 w.e.f. 1.6.1994.

¹ Substituted by Act 35 of 1994 w.e.f. 1.6.1994.