Liability in respect of actionable wrong.

Where, immediately before the appointed day, the existing State of Bihar is subject to any liability in respect of any actionable wrong other than breach of contract, that liability shall,—

1. (a) if the cause of action arose wholly within the territories which, as from that day, are the territories of either of the successor States of Bihar or Jharkhand, be a liability of that successor State; and
2. (b) in any other case, be initially a liability of the State of Bihar, but subject to such financial adjustment as may be agreed upon between the States of Bihar and Jharkhand or, in default of such agreement, as the Central Government may, by order, direct.