Transitional provisions on the constitution or extension of the area of the municipality.

3-A.Transitional provisions on the constitution or extension of the area of the municipality.— (1) When the municipality is constituted or extended, all property, all rights of whatever kind, used, enjoyed or possessed by, and all interests of whatever kind owned by, or vested in, or held in trust by or for the municipality or the panchayat constituted under the Tamil Nadu Panchayats Act, 1994 (Tamil Nadu Act 21 of 1994), of which local area is included as well as all liabilities legally subsisting against such municipality or panchayat, as the case may be, on and from the date of the notification, by which such constitution or extension of the municipality is declared, shall, subject to such directions as the Government may, by general or special order, give in this behalf, vest with the municipality constituted or to which such areas have been included. (2) All arrears of taxes or other payments by way of composition for a tax, or due for expenses or compensation or otherwise, except such arrears or payments in respect of water supply and sewerage services, in respect of the Chennai Metropolitan Area, due to such municipality or panchayat, as the case may be, on the date of such notification, shall be recovered as if they had accrued to the municipality constituted or to which such areas have been included and shall be recovered as if such arrears or payments had become due under the provisions of this Act. (3) All taxes, fees and duties, which immediately before the date of such notification, were being levied by such municipality or panchayat, as the case may be, shall be deemed to have been levied by the municipality constituted or to which such local areas have been included, under the provisions of this Act and shall continue to be in force accordingly until such taxes, fees and duties are revised, cancelled or superseded by, anything done or any action taken under this Act. (4) All proceedings taken by, or against, such panchayat or authority or any person under the Tamil Nadu Panchayats Act, 1994 (Tamil Nadu Act 21 of 1994), shall be continued by, or against, the municipality or authority or person as if such proceedings had been commenced under the provisions of this Act. (5) Any action taken under the Tamil Nadu Panchayats Act, 1994 (Tamil Nadu Act 21 of 1994) by any authority before the date of such notification, shall be deemed to have been taken by the authority competent to take such action under this Act, as if this Act had then been in force. (6) Notwithstanding anything contained in this Act, every officer or employee who, immediately before the date of such notification, was in the service of such municipality or panchayat, as the case may be, shall, on and from the date of such notification, be deemed to be an officer or employee of the municipality constituted or to which such local areas have been included: Provided that— (a) the terms and conditions applicable to such officer or employee consequent on his absorption in the service of the municipality constituted or to which such local areas have been included shall not be less favourable than those applicable to such officer or employee immediately before the date of such notification, as regards pay and allowances, leave, pension, gratuity, provident fund and age of superannuation; and (b) the service rendered by such officer or employee under such panchayat, upto the date of such notification, shall be deemed to be the service under the municipality constituted or to which such local areas have been included and he shall be entitled to count that service for the purpose of increments, leave, pension, provident fund and gratuity: Provided further that such officer or employee serving in such panchayat, shall be given an option to be exercised within such time and in such manner as may be prescribed either to be absorbed in the service of the municipality to which such local areas have been included or to be transferred to the service referred to in sections 104 and 105 of the Tamil Nadu Panchayats Act, 1994 (Tamil Nadu Act 21 of 1994) or to be retrenched from the service of such panchayat, and on such retrenchment, he shall be eligible for such benefits as may be prescribed.