Explanation:

Recently, the Allahabad High Court quashed the Uttar Pradesh government’s draft notification on urban local body elections and ordered it to hold the polls without reservation for the Other Backward Classes (OBC).
Provisions of the Urban Local Body

• The Urban Local Bodies were constitutionalized through the 74th Constitutional Amendment Act of 1992.
• This act added a new Twelfth Schedule to the Constitution and it contains 18 functional items of municipalities.

Reservation

• The act provides not less than one-third of the total number of seats for women (including the number of seats reserved for women belonging to the SCs and the STs).

• It also provides for the reservation of seats for the scheduled castes and the scheduled tribes in every municipality in the proportion of their population.

• There will be no bar on State Legislatures from making provisions for the reservation of seats in any municipality or office of Chairperson in the municipalities in favour of the backward class of citizens.

• Term: The municipality has a fixed term of 5 years from the date appointed for its first meeting.

Elections

• To constitute a municipality are required to be completed before the expiration of the duration of the municipality.

• If the municipality is dissolved before the expiry of 5 years, the elections for constituting a new municipality are required to be completed within 6 months from the date of its dissolution.

• If a municipality is elected after it has been dissolved, it will remain in existence for the remainder of the time that it would have remained in existence had it not been dissolved.

Hence only statement 2nd is correct.