Dispute over the Shanan Hydropower Project | 11 Mar 2024

Source: IE

Why in News?

Recently, the central government ordered that the status quo be maintained on the Shanan hydropower project, over which Punjab and Himachal Pradesh have made competing claims.

• Punjab has moved the Supreme Court over this issue.

What is the Shanan Project and the Claims of Different Parties over it?

• Historical Background:
  • During the British era in 1925, Punjab was granted a lease for the 110-MW hydropower project situated in Jogindernagar, Mandi district of Himachal Pradesh on river Uhl, a tributary of the Beas River.
  • Lease Agreement:
    • The lease agreement was formalised between Raja Joginder Bahadur, the ruler of Mandi at the time, and Col BC Batty, who represented the British government and served as the Chief Engineer of Punjab.
  • Project Utility:
    • The hydropower project served the energy needs of the undivided Punjab and Delhi before India gained independence.
      • Following the partition, the supply to Lahore was halted, and the transmission line was terminated at Verka village in Amritsar.
  • Legal Control under Punjab Reorganisation Act, 1966:
    • During the reorganisation of states in 1966, the hydropower project was transferred to Punjab, as Himachal Pradesh was then designated as a Union Territory.
      • Punjab was officially allocated the project through a central notification issued on 1^st May 1967, by the Union Ministry of Irrigation and Power.
    • The notification specified that Punjab's legal control over the project was governed by the provisions outlined in the Punjab Reorganisation Act, 1966.
• Claim of Himachal Pradesh:
  • Before the lease of 1925, which granted the project to Punjab, Himachal Pradesh had both ownership and operational rights over the project.
    • The 1925 lease only granted operational rights to Punjab for a specific period and not ownership rights.
  • In the past few years, Himachal Pradesh has contended that the project should stay with it once the lease ends.
  • The Himachal Pradesh government has raised concerns, alleging that the project is in a deteriorating condition due to a lack of repair and maintenance by Punjab.
  • The Chief Minister of Himachal Pradesh had stated that they would not allow Punjab to stake claim on the project after the lease period and wrote to his Punjab counterpart last year and also took up the issue with the Union Ministry of Power.
• Claims of Punjab:
  • Ownership and Possession Claim:
    • Punjab has presented its case in the Supreme Court, asserting that it is the rightful owner and in lawful possession of the Shanan Power House Project under the central notification of 1967.
    • The state government, through the Punjab State Power Corporation Ltd (PSPCL), currently exercises control over all assets associated with the project.
  • Legal Action Requested:
    • Under Article 131 the government of Punjab has requested a "permanent Prohibitory Injunction" from the Supreme Court.
    • This injunction is sought to prevent the Himachal Pradesh government from interfering with the "lawful peaceful possession and smooth functioning" of the Project.
• Interim Measure Ordered by the Centre:
  • A day before the conclusion of the 99-year-old lease agreement, the Central government intervened by issuing an order to maintain the status quo on the Project. This measure was implemented to ensure the continuous operation of the project.
  • The directive was issued by the Ministry of Power. It invoked the powers vested under Sections 67 and 96 of the Punjab Reorganisation Act, 1966, in conjunction with Section 21 of the General Clause Act, 1887.