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THE BIHAR AND WEST BENGAL (TRANSFER OF TERRITORIES) ACT, 1956

Title : THE BIHAR AND WEST BENGAL (TRANSFER OF TERRITORIES) ACT, 1956

Year : 1956



(1) Subject to the other provisions of this Part, all land and all stores, articles and other goods in the transferred territories belonging to the State of Bihar shall, as from the appointed day, pass to the State of West Bengal.

(2) Any unissued stores of any class in Bihar shall be divided between West Bengal and Bihar in proportion to the total indents for stores of that class made in the period of three years ending with the 31st day of March, 1956, for the transferred territories and for the rest of Bihar:

Provided that nothing in this sub-section shall apply to stores held for specific purposes such as use or utilisation in particular institutions, workshops or undertakings or on particular works under construction.

(3) In this section, the expression "land" includes immovable property of every kind and any rights in or over such property and the expression "goods" does not include coins, bank notes and currency notes.



The total of the cash balances in all treasuries of Bihar and the credit balances of Bihar with the Reserve Bank of India immediately before the appointed day shall be divided between that State and West Bengal according to the population ratio:

Provided that for the purposes of such division, there shall be no transfer of cash balances from any treasury to any other treasury and the apportionment shall be effected by adjusting the credit balances of Bihar and West Bengal in the books of the Reserve Bank of India on the appointed day.



The right of Bihar to recover arrears of any tax or duty on property situate in the transferred territories, including land revenue, shall belong to West Bengal and the right of Bihar to recover arrears of any other tax or duty in any case where the place of assessment of that tax or duty is in the transferred territories shall also belong to West Bengal.



The right to recover any loans or advances made before the appointed day by Bihar to any local body, society, agriculturist or other person in the transferred territories shall belong to West Bengal.



The investments in the cash balance investments account, the famine relief fund and the general fund of Bihar and the sums at the credit of Bihar in the central road fund shall be divided between Bihar and West Bengal according to the population ratio; and the investments in any special fund the objects of which are confined to the transferred territories or any part thereof shall pass to West Bengal.



(1) The assets and liabilities relating to any commercial or industrial undertaking of Bihar located in the transferred territories shall pass to West Bengal.

(2) Where a depreciation reserve fund is maintained by Bihar for any such commercial or industrial undertaking, the securities held in respect of investments made from that fund shall also pass to
West Bengal.



(1) The public debt of Bihar attributable to loans raised by the issue of Government securities and outstanding with the public immediately before the appointed day shall continue to be the debt of Bihar:

Provided that-

(a) West Bengal shall be liable to pay to Bihar a share of the sums due from time to time for the servicing and repayment of the public debt; and

(b) For the purpose of determining the said share, the said debt shall be deemed to be divided between Bihar and West Bengal as if it were a debt referred to in sub-section (2).

(2) The public debt of Bihar attributable to loans taken from the
Central Government, the Reserve Bank of India or any other bank before the appointed day shall be divided between Bihar and West Bengal in proportion to the total expenditure on all capital works and other capital outlays incurred up to the appointed day in the territories of Bihar excluding the transferred territories and in the transferred territories, respectively:

Provided that for the purposes of such division, only expenditure on assets for which capital accounts have been kept shall be taken into account.

(3) Where a sinking fund or depreciation fund is maintained by Bihar for the repayment of any loan raised by it, the securities held in respect of investments made from that fund shall be divided between Bihar and West Bengal in the same proportion as the public debt referred to in sub-section (2).

(4) In this section, the expression "Government security" means a security created and issued for the purpose of raising a public loan and having any of the forms specified or prescribed under clause(2) of section 2 of the Public Debt Act, 1944 (18 of 1944).



The liability of Bihar to refund any tax or duty on property situate in the transferred territories, including land revenue, collected in excess shall be the liability of West Bengal and the liability of Bihar to refund any other tax or duty collected in excess in any case where the place of assessment of that tax or duty is in the transferred territories shall also be the liability of West Bengal.



The liability of Bihar in respect of any civil deposit or local fund deposit made in the transferred territories shall, as from the appointed day, be the liability of West Bengal.



The liability of Bihar in respect of the provident fund account of any Government servant who, being in service on the appointed day, is permanently allotted to West Bengal shall, as from that day, be the liability of West Bengal.



The liability of Bihar in respect of pensions shall be apportioned between that State and West Bengal in accordance with the provisions contained in the Schedule.



(1) Where, before the appointed day, the State of Bihar has made any contract in the exercise of its executive power for any purposes of the State, that contract shall be deemed to have been made in the exercise of the executive power-

(a) Of Bihar, if the purposes of the contract are, as from the appointed day, exclusively purposes of that State;

(b) Of West Bengal, if the purposes of the contract are, as from that day, exclusively purposes of that State; and

(c) Of Bihar, in any other case;and all rights and liabilities which have accrued, or may accrue, under any such contract shall, to the extent to which they would have been rights or liabilities of Bihar, be rights or liabilities of Bihar or of West Bengal, as the case may be:

Provided that, in any such case as is referred to in clause (c), the initial allocation of rights and liabilities made by this sub-section shall be subject to such financial adjustment as may be agreed upon between the two States, or in default of such agreement, as the Central Government may by order direct.

(2) For the purposes of this section, there shall be deemed to be included in the liabilities which have accrued or may accrue under any contract-

(a) Any liability to satisfy an order or award made by any Court or other tribunal in proceedings relating to the contract; and

(b) Any liability in respect of expenses incurred in or in connection with any such proceedings.

(3) This section shall have effect subject to the other provisions of this part relating to the apportionment of liabilities in respect of loans, guarantees and other financial obligations; and bank balances and securities shall, notwithstanding that they partake of the nature of contractual rights, be dealt with under those provisions.



Where, immediately before the appointed day, Bihar is subject to any liability in respect of actionable wrong other than breach of contract, that liability shall,-

(a) If the cause of action arose wholly within the transferred territories, be a liability of West Bengal;

(b) If the cause of action arose wholly within the territories of Bihar excluding the transferred territories, be a liability of Bihar; and

(c) In any other case, be initially a liability of Bihar, but subject to such financial adjustment as may be agreed upon between that State and West Bengal, or in default of such agreement, as the Central Government may by order direct.



Where, immediately before the appointed day, Bihar is liable as guarantor in respect of any liability of a registered co-operative society, that liability shall-

(a) If the area of the societys operations is limited to the transferred territories, be a liability of West Bengal; and

(b) In any other case, continue to be a liability of Bihar.



If any item in suspense is ultimately found to affect an asset or liability of the nature referred to in any of the foregoing provisions of this Part, it shall be dealt with in accordance with that provision.



Where either Bihar or West Bengal becomes entitled to any property or obtains any benefits or becomes subject to any liability, and the Central Government, on a reference made within a period of three years from the appointed day by either of the States, is of opinion that it is just and equitable that that property or those benefits should be transferred to, or shared with, the other State or that a contribution towards that liability should be made by the other State, the said property or benefits shall be allocated in such manner between the two States, or the other State shall make to the State subject to the liability such contribution in respect thereof, as the Central Government may, after consultation with the two State Government, by order determine.



All sums payable by either Bihar or West Bengal to the other State by virtue of the provisions of this Part shall be charged on the Consolidated Fund of the State by which such sums are payable.
Last updated on September, 2016

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