Contracts for bulk supply

A local authority may, with the previous approval of the Government,- (a) enter into a contract for supply of water in its area or a part thereof with another local authority or a water supply undertaking, or (b) provide a supply of water in bulk to a local authority of an adjoining local area, on such terms as may be agreed; (c) provide supply of water by bulk or measure to (i) any trade, manufacture or business; (ii) medical or educational institutions, hostels, hotels and restaurants; (iii) ports, ships, railways, cantonments, army and labour camps; (iv) fountains, swimming pools and the like; and (v) gardens and pastures; on such terms as may be laid down: Provided that the Government shall not approve any proposal under this section unless it is satisfied that the proposal is not likely to interfere with the supply of water for domestic or other purposes, within the area of the supplying local authority.