261. Effect of conversion of nagar panchayat into village panchayat.
(1)Where any local area is declared to be a village under clause (g) of Article 243 of the Constitution and, immediately before such declaration, the local area was co-extensive with the limits of a municipal borough or included an area comprising a municipal, borough as well as any other area, then with effect from the date on which such local area is so declared to be a village (in this section referred to "as the said date") the following consequences shall, notwithstanding anything in the Municipal Act, ensue, that is to say-(a)the nagar panchayat functioning in such local area or part thereof shall cease to exist;(b)there shall, notwithstanding anything contained in any law for the time being in force be constituted for the village an interim villages panchayat consisting of persons vacating office as members of the nagar panchayat or members of the committee thereof and the President and Vice-President of the nagar panchayat shall respectively, be deemed to be the Sarpanch and Upa-Sarpanch of the interim village panchayat;Provided that if immediately before the nagar panchayat so ceasing to exist, there be a person or persons appointed under section 263 of the Municipal Act to exercise the powers and perform the duties of the nagar panchayat, there shall be an interim village panchayat for the local area and the person or persons so appointed, shall be deemed to be a person or persons appointed under clause (a) of sub-section (4) of section 253 to exercise all the powers and perform all the duties of such interim village panchayat.(c)the unexpended balance of the nagar fund and property including arrears of rates, taxes and fees belonging to the nagar panchayat, and all rights and powers, which prior to such notification, vested in the nagar panchayat shall, subject to all charges and liabilities affecting the same vest in the interim village panchayat as the village fund until the new panchayat is constituted under the provisions of this Act:(d)any appointment, notification, notice, tax, fee, cess, order scheme, licence permission, rule, bye law, or form made, issued, imposed or granted under the Municipal Act immediately before the said date in respect of such local area shall continue to be in force and be deemed to have been made, issued, imposed or granted in respect of the village until it is superseded or modified by any other appointment, notification, notice, tax, fee, cess, order, scheme, licence, permission, rule, bye-law, or form made, issued, imposed or granted under this Act.(e)all budget estimates, assessments, assessment lists, valuations or measurements made or authenticated under the Municipal Act immediately before the said date in respect of such local area shall be deemed to have been made or authencticated under this Act;(f)all debts and obligations incurred and all contracts made by or on behalf of the nagar panchayat immediately before the said date and subsisting on the said date shall be deemed to have been incurred and made by the interim village panchayat in exercise of the powers conferred on it by or under this Act.(g)all officers and servants in the employ of the nagar panchayat immediately before the said date shall be officers and servants of the interim village panchayat under this Act and shall, until other provision is made in accordance with the provisions of this Act, receive salaries and allowances and be subject to the conditions of service to which they were entitled or subject on such date:Provided that it shall be competent to the interim village panchayat subject however to the previous sanction of the State Government, to discontinue the services of any officer or servant who, in its opinion, is not necessary or suitable to the requirements of the service of the interim village panchayat, after giving such officer or servant such notice as is required to be given by the terms of his employment and every officer or servant whose services are discontinued shall be entitled to such leave, pension, provident fund and gratuity as he would have been entitled to take or receive on being invalided out of service as if the nagar panchayat in the employ of which he was, had not ceased to exist:(h)all proceedings pending at the said date before the nagar panchayat shall be deemed to be transferred to, and continued by, the interim village panchayat;(i)all appeals pending at the said date before the nagar panchayat shall, so far as may be practicable, be disposed of as if such local area had been included in the village when they were filed;(j)all prosecutions instituted by or on behalf of the nagar panchayat and all suits or other legal proceedings instituted by or against `such nagar panchayat or any officer of such nagar panchayat pending at the said date shall be continued by or against the interim village panchayat as if such local area had been included in the village when such prosecutions, suits or proceedings were instituted:(k)any law (other than the Municipal Act) of any rule, bye-law, notification or order issued under such law, which was applicable to and in force in the local area immediately before it was declared as a village under clause (g) of article 243 of the Constitution, shall continue to apply to and to be in force in the local area until it is superseded.(2)The duration of the interim vilage panchayat shall be the same as that of the nagar panchayat had it continued to exist or till elections are held for reconstituting the interim village panchayat alongwith other village panchayats whichever is earlier.(3)All arrears of rates, taxes and fees vesting in the interim village panchayat shall be recoverable under the provisions of this Act as if the rates, taxes and fees were imposed and recoverable under this Act.(4)In other respects the provisions of this Act shall, mutatis muatandis, apply to the interim village panchayat and its members.(5)If any difficulty arises.(i)in the constitution of the interim village panchayat which succeds it, or(ii)in giving effect to the provisions of this section.the State Government may by order as occasion may require, do notwithstanding anything contained in this Act or in the Municipal Act, anything which appears to it to be necessary to remove the difficulty.
