(1) With effect on and from the appointed day, the Sreepadam Palace shall not be entitled to collect any rent which accrued due to it from any landholder in respect of his holding before, and is outstanding on that day, but the Tahsildar of the taluk in which the holding is situate shall be entitled to collect all such arrears of rent and any interest payable thereon as if they were arrears of public revenue due on land:
Provided that if a landholder pays within two years from the appointed day in such manner as may be prescribed an amount equal to the arrears of rent for three financial years or the actual arrears outstanding on the appointed day, whichever is less, together with interest thereon, all arrears of rent shall be deemed to be fully discharged and no suit or other proceedings shall be or continue for the recovery thereof.
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(2) All amounts paid or collected under sub-section (1) shall be paid to the Sreepadam Palace after deducting—
(a) five per cent thereof on account of collection charges;
(b) the amount if any, due from the Sreepadam Palace to the Government.
(c) the rent, if any, collected before the appointed day by the Sreepadam Palace from any landholder in respect of the financial year in which the appointed day falls or any subsequent financial year.
(3) All amounts which the Tahsildar is entitled to collect under sub-section (1) shall be a first charge upon the land in respect of which such amounts are payable, subject only to the charge for basic tax.