(1) If, at any time, the whole of the area of a Gram is included in a municipality, or in an area constituted as a notified area under section 93A of the Bengal Municipal Act, 1932, or in an area under the authority of a Municipal Corporation, a Town Committee or a Cantonment, the Gram Panchayat concerned shall cease to exist and the properties, funds and other assets vested in such Gram Panchayat and all the rights and liabilities of such Gram Panchayat shall vest in and devolve on the Commissioners of the Municipality or the notified area authority or on the Municipal Corporation or on the Town Committee or on the Cantonment Authority, as the case may be.
(2) If, at any time, a part of the area of a Gram is included in a municipality or in an area constituted as a notified area under section 93A of the Bengal Municipal Act, 1932, or in an area under the authority of a Municipal Corporation, a Town Committee or a Cantonment, the area of the Gram shall be deemed to have been reduced to the extent of the part so included in a municipality or in the area constituted as a notified area or under the authority of a Municipal Corporation, a Town Committee or a Cantonment, and the properties, funds and liabilities of the Gram Panchayat concerned in respect of the part so included shall vest in and devolve on the Commissioners of the Municipality or the notified area authority or on the Municipal Corporation or on the Town Committee or on the Cantonment Authority, as the case may be, in accordance with such allocation as may be determined by the prescribed authority and such determination shall be final and, unless the State Government otherwise directs, all rules, orders, directions and notifications in force in the area under the authority of the Commissioners of the Municipality, notified area authority, Municipal Corporation, Town Committee or Cantonment, as the case may be, shall apply to the part of the area of the Gram so included.