States Reorganisation Act, 1956 · Chapter VII: Apportionment of Assets and Liabilities of Certain Part A and Part B States
Section 79: Right to recover loans and advances
(1) The right to recover any loans or advances made before the appointed day by an existing State to any local body, society, agriculturist or other person in an area within that State shall belong to the successor State in which that area is included.
(2) The right to recover any loans or advances made before the appointed day by an existing State to any person or institution outside that State shall belong to the successor State or, if there be two or more successor States, to the principal successor State:
Provided that where there are two or more successor States, any sum recovered in respect of any such loan or advance shall be divided between all the successor States according to the population ratio.
Source: India Code (indiacode.gov.in), the consolidated text published by the Legislative Department, Government of India. Text as updated on India Code on 15 October 2026. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.
Supreme Court judgments citing the section 79
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