Report No. 249

6. Apportionment of assets and liabilities

This part of the reorganisation acts provides for the passing on of goods and articles belonging to the existing States to the successor States. The total of the cash balances in all treasuries of the existing State and the credit balances of that State with the Reserve Bank of India, the State Bank of India or any other bank immediately before the appointed day (of reorganisation) was divided between the successor States according to the population ratio.

Also, the right to recover arrears of any tax or duty on property, including arrears of land revenue, was to belong to the successor State in whose territories the property was situated, and the right to recover arrears of any other tax or duty belonged to the successor State in whose territories the place of assessment of that tax or duty was included.

The possibilities of disputes between States pertaining to the apportionment of assets and liabilities still persist. Hence, provisions of this nature cannot be repealed.