(1) The assets and liabilities relating to any commercial or industrial undertaking of the existing State of Punjab shall pass to the successor State in whose territories the undertaking is located.

(2) Where a depreciation reserve fund is maintained by the existing State of Punjab for any commercial or industrial undertaking, the securities held in respect of investments made from that fund shall pass to the successor State in whose territories the undertaking is located.

(3) Where any such undertaking is located in more than one successor State, the assets and liabilities and the securities referred to in sub-sections (1) and (2) respectively shall be divided in such manner as may be agreed upon between the successor States before the 1st day of November, 1967, or in default of such agreement, as the Central Government may by order direct.