Section 3(3) in The Punjab Panchayati Raj Act, 1994
(3)(i)where any area excluded from any Gram Sabha area under sub-section (2) is either included in any other Gram Sabha area or is constituted into a new Gram Sabha area, the assets and liabilities of the Gram Panchayat of the Gram Sabha area from which such area is so excluded (hereinafter referred to as the existing Gram Panchayat) shall be apportioned between the successor Gram Panchayats in the manner specified hereinafter.(ii)All lands and all stores, articles and other goods belonging to the existing Gram Panchayat shall, -(a)If within the Gram Sabha area of that Gram Panchayat pass on to the successor Gram Panchayat in whose Gram Sabha area they are situated;(b)if outside the Gram Sabha area of that Gram Panchayat be apportioned between the successor Gram Panchayats according to population ratio;(iii)The Gram Fund, Bank Balances, grants received from the State Government from time to time shall be apportioned between the successor Gram Panchayats according to the population ratio:Provided that a grant given by the State Government for the development of an area which forms part of the Gram Sabha area of any of the successor Gram Panchayats shall be transferred to that successor Gram Panchayat.(iv)The right to recover arrears of any tax on property shall belong to the successor Gram Panchayat in whose Gram Sabha area the property is situated and the right to recover any other tax imposed by the existing Gram Panchayat shall belong to the successor Gram Panchayat in whose Gram Sabha area the place of assessment of that tax is situated.(v)Where before the date of exclusion of Gram Sabha area the existing Gram Panchayat has made any contract for the purposes of that Gram Panchayat, that contract shall be deemed to have been made-(a)if the purposes of the contract are on and from the day of exclusion of the Gram Sabha area, exclusively purposes of any one of the successor Gram Panchayat, by that successor Gram Panchayat; and(b)if the purposes of the contract are on and from that day not exclusively purposes of any one of the successor Gram Panchayats, by all the Gram Panchayats;and the rights and liabilities which have accrued or may accrue, under any such contract, shall to the extent to which they would have been the rights and liabilities of the existing Gram Panchayats, be the rights and liabilities of the successor Gram Panchayat, or, as the case may be, the successor Gram Panchayats according to their population ratio.(vi)where the existing Gram Panchayat is a party to any legal proceedings with respect to any property, rights or liabilities subject to apportionment under this section, the successor Gram Panchayat which succeeds to, or acquire a share, in that property or those rights or liabilities, shall be deemed to be substituted or added as a party to those proceedings, and the proceedings may continue accordingly.(vii)The benefit or burden of any assets and liabilities of the existing Gram Panchayat, not dealt with in the forgoing provisions of this section shall, pass on to the successor Gram Panchayats in the manner agreed upon between them and in case no such agreement is reached within a period of one year from the date of exclusion of the Gram Sabha area the State Government shall be competent to determine the same at the request of either of the Gram Panchayats.
