New Delhi: The Supreme Court on Thursday took a stern view of Punjab’s objections in the long-running Bhakra Beas Management Board (BBMB) dispute after the Centre proposed a cashless formula to settle Himachal Pradesh’s pending electricity dues dating back to 1966.
The Union Government informed the apex court that the decades-old dispute could be resolved through an energy-based settlement instead of monetary compensation. Under the proposal, Punjab and Haryana would compensate Himachal Pradesh by transferring electricity rather than making direct cash payments.
According to the proposed formula, Himachal’s pending entitlement of 13,066 million units of electricity would largely be adjusted through energy allocation. The Centre has also suggested that Himachal should not be required to pay nearly Rs 420 crore towards capital costs to Punjab and Haryana, with the amount adjusted against its electricity share.
A Bench headed by Chief Justice of India Surya Kant noted that Himachal Pradesh and Haryana had, in principle, agreed to the proposal, while Punjab continued to raise objections. The court questioned Punjab’s stand, observing that the state could not ignore an existing Supreme Court decree and directed it to clarify its position within two weeks. The matter has been listed for further hearing on August 12.
Appearing for the Centre, Attorney General R. Venkataramani said a cashless settlement was the most practical solution, as resolving the issue strictly under the Punjab Reorganisation Act, 1966, had not yielded results despite years of discussions. He added that extensive efforts had been made to evolve a mutually acceptable formula.
Representing Punjab, senior advocate Nidesh Gupta said the state was mainly concerned about the rate proposed for calculating the arrears. He argued that the suggested rate of Rs 2.50 per unit was too high and could impose an additional burden of nearly Rs 2,000 crore on Punjab.
The Bench, however, observed that if Punjab refused to support an amicable settlement, the court would decide the matter on its merits. It also pointed out that Himachal had fewer revenue-generating resources than Punjab and Haryana, while the rivers and dams connected to the BBMB projects were located within Himachal.
Senior advocate Kapil Sibal, appearing for Himachal Pradesh, argued that the state had been waiting for nearly 15 years to receive benefits already recognised by the Supreme Court. He said the state was entitled to arrears under the court’s 2011 judgment, but payments had remained pending despite the decree.
Haryana also expressed its willingness to support the Centre’s proposal in principle, while seeking participation in future negotiations on the final settlement.
The dispute dates back to the Punjab Reorganisation Act of 1966, after which Himachal Pradesh sought a share in the BBMB projects as a successor state. When negotiations failed, the state approached the Supreme Court in 1996. In its 2011 judgment, the apex court awarded Himachal a 7.19 per cent share in the BBMB projects, while Punjab, Haryana, Rajasthan and Chandigarh were allocated their respective shares.
Earlier this month, Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu claimed the state had been deprived of 13,066 million units of electricity and related financial benefits for years. He estimated the outstanding dues at nearly Rs 4,200 crore and said the state government was pursuing all legal and administrative measures to recover the amount.
