New Delhi: The Centre on Wednesday told the Supreme Court that the Punjab government is very close to agreeing to its proposal for settling outstanding dues to Himachal Pradesh arising from the Bhakra‑Beas Management Board (BBMB) projects since 1966. The top court has listed the matter for further hearing on August 20.
Court hearing and present stance
Appearing before a bench comprising Chief Justice Surya Kant and Justices Joymalya Bagchi and V Mohana, Attorney General R Venkataramani said the parties were moving towards an amicable resolution. Senior advocate Kapil Sibal, representing Himachal Pradesh, was also present. The bench had earlier recorded that Himachal and Haryana had in principle agreed to the Centre's formula, while Punjab had voiced objections.
"I must say now today we speak in a joint voice. Punjab is coming very closer,"
The Attorney General added, "I think we are going to iron out the creases," and sought that the matter be listed for next week.
What the Centre's proposal contains
According to the documents placed before the court and submissions made, the dispute centres on the payment of arrears relating to allocation of power from the BBMB projects. The BBMB is already paying 7.19 per cent share of Himachal Pradesh's electricity from Bhakra‑Beas projects after November 1, 2011, while Punjab and Haryana have not paid outstanding dues for the earlier period.
The arrears amount to 13,066 million units of electricity for the period prior to November 2011. Because the parties could not agree on a monetary rate to monetise the electricity dues, the Centre has proposed a cashless adjustment in energy terms, whereby Punjab and Haryana would make payouts to Himachal in units of energy rather than direct cash transfers. Under the arrangement, Himachal would forgo the right to claim dues of ₹420 crore from Punjab and Haryana; that sum, the Centre has suggested, would instead be adjusted from the 13,066 million units.
Implications for Punjab and other partner states
The proposal, if accepted, would require Punjab and Haryana to account for their share of arrears in energy units rather than rupees, which could affect state energy balances and future receipts from BBMB allocations. For Punjab, which relies on BBMB allocations for irrigation and power distribution in parts of the state, the manner of adjustment — cashless energy settlement versus monetary payout — will carry budgetary and operational consequences.
- Outstanding units: 13,066 million units (prior to Nov 1, 2011)
- Post‑2011 share: BBMB pays 7.19% share of Himachal's electricity after Nov 1, 2011
- Monetary claim adjusted: ₹420 crore to be set off against units
Background and previous court interaction
The matter has been before the apex court for directions on settling arrears among partner states of BBMB. On July 30, the Centre had told the Supreme Court that an amicable settlement could be reached using a new cashless formula. The court noted then that while Himachal and Haryana were prepared to accept the Centre's proposal in principle, Punjab had objected. The bench had also criticised Punjab's reluctance to accept court directions in the past.
Officials and counsels framed the present round of discussions as an attempt to resolve long‑standing inter‑state disagreements over legacy BBMB allocations without prolonged litigation. The Centre's suggestion of an energy‑term payout is aimed at circumventing disputes over the appropriate rupee valuation of historical units, a key sticking point among the parties.
Next steps and what to watch
The Supreme Court has posted the case for hearing on August 20. Observers will be looking for whether Punjab formally records its agreement to the Centre's cashless formula or continues to press for an alternative valuation, which would keep the matter alive. Any settlement will need to spell out conversion norms, scheduling of unit adjustments and administrative mechanisms to reflect the offset against the ₹420 crore claim.
| Item | Detail |
|---|---|
| Outstanding units | 13,066 million units |
| Post‑2011 Himachal share paid by BBMB | 7.19% |
| Monetary claim to be adjusted | ₹420 crore |
The resolution of the BBMB dispute is consequential for Punjab's energy planning as well as for Himachal and Haryana. A cashless unit adjustment would settle historical claims without immediate cash outflows but will require precise administrative arrangements to implement the offsets and ensure transparent accounting among the partner states.
The Supreme Court's next hearing will determine whether the parties have bridged remaining differences and can formalise the Centre's proposed framework.
