Section 71 of The Manipur Panchayati Raj Act, 1994
- (1)A Zilla Parishad may, subject to the provisions of any law relating to the raising of loans by local authorities for the time being in force, raise from time to time, with the approval of the Government, loans for the purpose of the Act and create a sinking fund for the repayment of such loans.
- (2)Notwithstanding anything contained in sub-section (1) a Zilla Parishad may borrow money from the Government or, with the previous sanction, of the Government, from banks or other financial institutions, for furtherance of its objective on the basis of specific scheme as may be drawn up by the Zilla Parishad for the purpose.
Summary
- The district council is allowed to borrow money for its projects if it gets permission from the state government.
- When it takes a loan, it can set up a sinking fund, which is a special savings pot to pay the money back later.
- The council can take loans from the government directly or from banks and financial institutions.
- Any borrowing must be based on a specific, detailed plan or scheme for its objectives.
Practical examples
FAQ
1. Who must approve a loan under Section 71 of the Manipur Panchayati Raj Act, 1994?
The State Government must give its approval before the council can raise any loans under Section 71 of the Manipur Panchayati Raj Act, 1994.
2. Can the council borrow from a private person under Section 71 of the Manipur Panchayati Raj Act, 1994?
No, the Act specifically mentions borrowing from the Government, banks, or financial institutions under Section 71 of the Manipur Panchayati Raj Act, 1994.
3. What is a sinking fund in Section 71 of the Manipur Panchayati Raj Act, 1994?
It is a fund created to save money over time to pay back loans taken by the council under Section 71 of the Manipur Panchayati Raj Act, 1994.
Test yourself
Q1.Under Section 71 of the Manipur Panchayati Raj Act, 1994, what is required before borrowing from a bank?
Q2.According to Section 71 of the Manipur Panchayati Raj Act, 1994, borrowing must be done on the basis of what?
Q3.Under Section 71 of the Manipur Panchayati Raj Act, 1994, what is the purpose of a "sinking fund"?
Q4.Combined with Section 69 of the Manipur Panchayati Raj Act, 1994, if a council raises a loan on the security of its assets, where does that loan money go?