Power of Municipality to raise loan.

(1) Subject to the approval of the State Government, the Municipality may, from time to time, by a resolution in this behalf passed at a meeting of the Municipality, raise a loan by the issue of debentures or otherwise, on the security of the property tax or all or any of the other taxes, surcharges, cesses, fees, and dues under this Act or both the property tax and all or any of the other taxes, surcharges, cesses, fees, and dues under this Act, or on the guarantee provided by the State Government for any sum of money which may be required for the purpose of- (a) construction of works under this Act, or (b) acquisition of lands and buildings required under this Act, or (c) paying off any debt due to the State Government, or (d) repayment of a loan raised under this Act, or (e) acquisition of a concern of public utility which renders such services as the Municipality is authorized to render under this Act, or (f) purchase of vehicles, locomotive engines, boilers and machinery necessary for implementing the provisions of this Act, or for any other purpose for which the Municipality is, by or under this Act or any other law for the time being in force, authorized to borrow: Provided that in addition to the loan as aforesaid, the Municipality may also take loan from the State Government or any statutory body or public sector corporation. (2) When any loan has been raised under sub-section (1), - (a) no portion thereof shall, without the previous sanction of the State Government, be applied to any purpose other than the purpose for which it has been raised, and (b) no portion of any loan raised for any of the purposes referred to in that sub-section shall be applied to the payment of salaries or allowances to any other employee of the Municipality, other than those who are exclusively employed for the purpose for which the loan has been raised. Explanation. - The expression "dues under this Act" in sub-section (1) shall, for the purpose of clause (e) of that sub-section, be deemed to include the income derivable from the concern of public utility referred to in that clause.