(1)The State Government may, by notification, declare any village or group of contiguous villages with a population of not less than [three hundred] [Substituted 'two hundred' by Punjab Act No. 4 of 2012, dated 21.5.2012] to constitute a Gram Sabha area:Provided that a new Gram Sabha area may be constituted for any village or group of contiguous villages in respect of a separate distinct abadi or group of abadis having a population of not less than [three hundred] [Substituted 'two hundred' by Punjab Act No. 4 of 2012, dated 21.5.2012] taking into consideration its physical distance from the main village or villages, as the case may be and other relevant facts:[Provided further that a Gram Sabha constituted prior to the commencement of the Punjab Panchayati Raj (Amendment) Act, 2012, with a population of less than three hundred shall not be affected:] [Inserted by Punjab Act No. 4 of 2012, dated 21.5.2012]Provided further that neither the whole nor any part of -(a)a Notified Area under Section 241 of the Punjab Municipal Act, 1911, or any other Act for the time being in force; or(b)a Cantonment ; or(c)a Municipality of any class; or(d)a Municipal Corporation;shall be included in a Gram Sabha area unless the majority of voters in any Notified Area or Municipality of the Third Class desire the establishment of a Gram Sabha in which case the assets and liabilities, if any, of the Notified Area Committee or the Municipal Committee, as the case may be, shall vest in the Gram Panchayat of that Gram Sabha and the Notified Area Committee or the Municipal Committee shall cease to exist.(2)That State Government may, by notification, include any area in or exclude any area from the Gram Sabha area.(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.(4)If whole of the Gram Sabha area is included in an urban estate to which the provisions of the Punjab Municipal Act, 1911 or the Punjab, Municipal Corporation Act, 1976, are applicable or in a city, municipality cantonment, or Notified Area under any law for the time being in force, the Gram Sabha and the Gram Panchayat for that area shall cease to exist and the assets and liabilities of the Gram Panchayat shall be disposed of in the prescribed manner.
