Where the Chairperson upon information in his possession is satisfied as respects any area--
         (a) that the buildings in that area are by reason of disrepair or sanitary defects unfit for human habitation or are by reason of their bad arrangement, or the narrowness or bad arrangement of the streets or the want of light, air, ventilation or proper conveniences, dangerous or injurious to the health of the inhabitants of the area; and
         (b) that the most satisfactory method of dealing with the conditions in the area is the re-arrangement and reconstruction of the streets and buildings in the area in accordance with an improvement scheme,
he may frame an improvement scheme in respect of the area in accordance with the bye-laws made in this behalf.