Whenever it appears to the Government¹[that additional funds are necessary to enable the Municipal Council to discharge its obligatory functions or] that the balance of the municipal fund of any municipal council is insufficient for meeting the expenditure incurred under section 307 or for the performance of any duties in respect of which it shall have been declared under section 313 to have committed default, the Government may by notification require the municipal council to impose, within the²[municipal area], any such tax specified in the notification as may be imposed under section 94 if no such tax is at the time imposed therein, or to enhance any existing tax in such manner or to such extent as the Government considers fit, and the municipal council shall forthwith proceed to impose or enhance in accordance with the requisition such tax under the provisions of this Chapter, as if a resolution of the municipal council had been passed for the purpose under section 95:

Provided that, --

(a) the Government shall take into consideration any objection which the municipal council or any inhabitant of the²[municipal area] may make against the imposition or enhancement of such tax;

(b) it shall not be lawful for the municipal council to abandon or modify or to abolish such tax when imposed; and

(c) the Government may at any time cancel or modify any requisition made by it under this section, and the levy of the tax or the enhancement, except in regard to arrears accrued and due, shall thereupon cease or be modified accordingly.

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1. Inserted by Act 83 of 1976 w.e.f. 8.12.1976.

2. Substituted by Act 36 of 1994 w.e.f. 1.6.1994.