18. Procedure in respect of unexpended balances of loans

If, on the completion of the work or the closing of the account of the transaction for which a local authority has borrowed money, the Government is satisfied that the whole of the money has not been spent on the purpose of which it was borrowed it shall proceed as follows, namely :-

  1. in the case of a Government loan - The Government shall direct that the unexpended balance shall be forthwith repaid to the Government, and the principal of the debt reduced by an equivalent amount. The Government may direct such variation as it may consider necessary on this account in the installments fixed for the liquidation of the loan.
  2. In the case of a non-Government loan - the Government may direct that the unexpended balance shall be utilised in the reduction in any way of the debt of the local authority.