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The Bihar Reorganisation Act, 2000 was passed by the Parliament for reconstituting the existing State of Bihar for the creation of State of Jharkhand. The Bihar Reorganisation Bill was introduced for giving effect to the statement made by the President in his address to the Parliament in 1999. The Bihar Reorganisation Act No. 30 of 2000 was came into effect on 15th November 2000 and on that day a new State of Jharkhand was formed.

Section 3 of the Bihar Reorganisation Act, 2000 dealt with the formation of the State of Jharkhand. Part III of the Act deals with the representation in the legislatures. This part divided the representation in the Council of States and House of People into two. As per Section 12 of the Act, State of Bihar and State of Jharkhand should have two hundred and forty three and eighty one seats respectively in their Legislative Assemblies.

Section 25 of the Act established a separate High Court for the State of Jharkhand. Under the Section from the appointed day onward, the existing High Court of Patna should be the High Court of the State of Bihar. Section 27 of the Act determined the jurisdiction of the new High Court in the territories of State of Jharkhand. Section 34 dealt with the transfer of proceedings from the High Court of Patna to the High Court of Jharkhand. Under the Section the High Court of Patna should not have any jurisdiction in respect of the territories of the new State. The proceedings pending should be transferred to the new High Court.

Section 38 empowered the Governor to authorise the expenditure of the Jharkhand from the Consolidated Fund of the State of Jharkhand until the sanction of the expenditure by the Legislative Assembly of Jharkhand. Further the report of the Comptroller & Auditor General, relating to the expenditure of the undivided State of Bihar in respect of the prior period of reorganisation, should be submitted before the Governors of both succeeding States. Power was vested in the President to distribute the revenue shares of successor States to the existing State of Bihar on the approval of the Finance Commission of India.

Part VI of the Act dealt with the distribution of the assets and liabilities. Under this part, lands and goods belonging to the existing State of Bihar should be passed to the State of Jharkhand, if it is situated within the transferred territory. The balance in the State Treasury and the bank balance should be divided between the succeeding States as per the population ratio. Right to recover arrears of tax should be vested with the succeeding State in which the asset was situated. Under section 48 all liabilities on public debt should be divided between the succeeding States on the basis of the population. Assets and liabilities of the State Undertakings should be vested with the State in which the Undertaking was situated.

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Part VII contained provisions relating to certain corporations. Under this part, State Electricity Board, Warehousing Corporation and Road Transport Corporation in the existing State of Bihar should continue their function in those areas where they functioned until the notification from the Central Government to dissolve them. The rights and liabilities of these institutions should be apportioned between the new States. Further the succeeding States could constitute State Electricity Board, State Warehousing Corporation and State Road Transport Corporation in their own territory.

Section 71 of the Act separated the State Cadre of All- India Service in the undivided State of Bihar into two. Under Section 72, every person under the service of State of Bihar before the reorganisation should continue to serve the new State of Bihar unless otherwise required by the Central Government.   By virtue of Section 77 of the Bihar Reorganisation Act, 2000, the State Public Service Commission of the existing State of Bihar should be the State Public Service Commission of the State of Bihar after reorganisation.

Part IX of the Act contains the provisions relating to the management and development of the water resources. Section 78 divided the rights and liabilities over Ganga and its tributaries and Sone and its tributaries to the State of Bihar and State of Jharkhand. The Act also mandated the Central Government to constitute the Ganga and Sone Management Board for that purpose.

Under section 85 of the Act the appropriate Government can adapt laws made before the reorganisation with necessary modifications or amendments to the State of Bihar or State of Jharkhand as the case may be. Section 86 gave power to construe laws for the purpose of facilitating them in their application in the new States without any change in their substance.

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Section 92 of the Bihar Reorganisation Act empowered the President to remove the difficulties, if any, arouse while effecting the provisions of the Act.