Finance, Property, Contracts
(1) Property/assets and rights/liabilities/obligations of the princely-state governments that became Part B states similarly vest in/become obligations of the Union (where connected to Union List purposes) or the corresponding new state government, subject to any agreement between the Government of India and that former princely state's government. (2) Otherwise, each Part B state's government succeeds to its corresponding former princely state's property and obligations generally.
This mirrors Article 294 for the several hundred former princely states that acceded to India and were reorganised into the new state structure - ensuring their pre-existing property and legal obligations were properly and predictably transferred to either the Union or the relevant new state government.
This provision helped manage the complex legal transition when numerous former princely states - each previously a separate governing entity with its own property and contracts - were absorbed into India's new state structure after independence.