Section 154(3) in The Bombay Provincial Municipal Corporations Act, 1949
(3)After consideration, of an appeal under sub-section (2), and after making such inquiries as may be necessary, the [State] Government or the said officer may with due regard to the provisions of sub-section (4), allow or disallow the proposal of the Commissioner and may, if it or he thinks fit, specify conditions, including conditions as to the payment of compensation by the Commissioner, subject to which it or he allows the proposal.