East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948
The owner referred to in the preceding section shall in the first instance offer the fragment for sale to the owners of contiguous survey numbers or recognised sub-division of survey numbers and in case of their refusal to purchase for the price as determined under the last preceding section may transfer it to the [Government] for the purpose of the [State]. On payment by the [Government] of such price as aforesaid to persons possessing interest therein as the Collector may determine, and thereupon the fragment shall vest absolutely in the [Government] for the purpose of the [State] free from all encumbrances.