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11. Disposal of application **

The Government or the authority authorised under rule 6, as the case may be, after conducting the enquiry referred to in rule 8 either:

  1. reject the application, or
  2. grant the loan or sanction the raising of the loan as the case may be, or
  3. permit the local authority to guarantee the payment of interest under S. 5 of the Act.

Provided that no application shall be rejected under this rule without giving the Local authority an opportunity to show cause against the action proposed to be taken.

** Substituted by ibid