6Disposal of cantonment fund and cantonment development fund when area ceases to be a cantonment.

(1) When, by a notification under section 3, any cantonment ceases to be a cantonment and the local area comprised therein is immediately placed under the control of a local authority, the balance of the cantonment fund or the cantonment development fund and other property vesting in the Board shall vest in such local authority, and the liabilities of the Board shall be transferred to such local authority.
(2) When, in like manner, any cantonment ceases to be a cantonment and the local area comprised therein is not immediately placed under the control of a local authority, the balance of the cantonment fund or the cantonment development fund and other property vesting in the Board shall vest in the Central Government, and the liabilities of the Board shall be transferred to that Government.