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Blow to Punjab govt as Punjab and Haryana HC stays move to transfer PSPCL properties

Punjab and Haryana HC division bench halts proposed land transfers amid PIL over Rs 2,582.24 crore dues and planned auction of acquired land.

4 min readChandigarhFeb 20, 2026 02:52 PM IST

File photo of the Punjab and Haryana High Court.

The Punjab and Haryana High Court Friday stayed the Punjab government’s move to transfer any property owned by the Punjab State Power Corporation Limited (PSPCL), granting significant interim relief in a public interest litigation (PIL) pending since January.

A division bench of Justice Ashwani Kumar Mishra and Justice Rohit Kapoor passed the order on an application moved by Senior Advocate Baltej Singh Sidhu.

Sidhu said he had sought urgent intervention against the proposed transfer of 50 acres in Badungarh village. According to him, the government was transferring the land to the Punjab Urban Planning and Development Authority (PUDA) under its 80:20 policy, after which it was to be auctioned in the open market. He alleged that the land had originally been acquired from farmers for a public purpose, but was never utilised and was now being put up for sale to generate funds for freebies.

The application forms part of a broader PIL filed by Rajbir Singh, which alleges a deepening financial crisis at PSPCL due to large-scale defaults by Punjab government departments and the state’s move to sell valuable public assets instead of recovering outstanding dues.

The petition states that electricity dues owed by various government departments had mounted to Rs 2,582.24 crore as of August 31, 2025. In addition, the unpaid power subsidy had crossed Rs 10,000 crore. It argues that although the government is a consumer like any other, it has failed to discharge its moral, ethical, and statutory obligation to clear electricity bills, pushing PSPCL into financial distress. As a result, the Corporation has allegedly been forced to take substantial loans to meet routine expenditure such as salaries, pensions, and power purchases.

The PIL contends that instead of invoking Section 56 of the Electricity Act, 2003, which permits recovery of arrears or disconnection of supply after due notice, PSPCL has been left grappling with mounting liabilities while the state proceeds to sell its land under the Optimum Use of Vacant Government Land Scheme.

It describes these properties as long-term public assets held in trust for future generations and argues that liquidating them to address what it terms a self-created fiscal crisis is improper, particularly when recoverable dues of comparable magnitude remain unpaid by the state itself. The petition also raises concerns that several parcels were acquired from farmers for specific public purposes but now stand vacant and are proposed to be sold for commercial use, which it says undermines the doctrine of public purpose.

Proposed transfer

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The record placed before the court refers to a government meeting on October 1, 2025, where a decision was taken to sell or transfer public properties, including PSPCL land, followed by a communication from PUDA dated October 10, 2025. Subsequent media reports highlighted the proposed transfer of 165 acres of prime PSPCL land at Bathinda for public auction.

In its prayers, the petition seeks a mandamus directing PSPCL to recover the Rs 2,582.24 crore default with interest and penalty or, in the alternative, to disconnect electricity supply to defaulting departments under Section 56 of the Electricity Act, 2003. It also seeks directions to the state and its finance department to release outstanding dues immediately and to clear the Rs 10,000 crore power subsidy.

The PIL asserts that it has been filed bona fide in public interest to safeguard public finances, enforce statutory accountability and prevent dissipation of public assets, and that it involves no personal interest of the petitioner.

With the interim stay in place, no transfer or sale of PSPCL properties can proceed. The matter is likely to be taken up again shortly.

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The development assumes significance against the backdrop of Punjab’s mounting fiscal stress, with the state’s outstanding debt estimated at around Rs 4 lakh crore as of October 2025.

Manraj Grewal Sharma

Manraj Grewal Sharma is a senior journalist and the Resident Editor of The Indian Express in Chandigarh, where she leads the newspaper’s coverage of north India’s most politically and institutionally significant regions. From Punjab and Haryana to Himachal Pradesh and the Union Territory of Chandigarh, she oversees reporting at the intersection of governance, law, politics and society. She also reports on the diaspora, especially in Canada and the US. With a career spanning journalism across several countries, academia and international development, Manraj brings a rare depth of perspective to regional reporting. She is widely regarded as a leading chronicler of Punjab’s contemporary history and socio-political evolution, particularly its long shadow of militancy, federal tensions and identity politics. Her book, Dreams after Darkness, remains a definitive account of the militancy years and their enduring aftermath. Professional Background & Expertise A gold medalist in mass communication and a post-graduate in English literature, Manraj has a multifaceted career spanning journalism, academia, and international development. She was also awarded a fellowship by National Foundation of India and did several in-depth pieces on Manipur. Internationally, she has reported from Israel, US, UK, Myanmar, and Mauritius Her key focus areas include: Regional Politics, History, Agriculture, Diaspora, and Security. Of late, she has started focusing on Legal & Judicial Affairs: Much of her recent work involves reporting on high-stakes cases in the Punjab and Haryana High Court, ranging from environmental policy to civil rights. International Consulting: She previously served as a consulting editor for the Asia Pacific Adaptation Network and a publishing consultant for the Asian Development Bank (ADB) in Manila. Academia: For five years, she was the managing editor of Gender, Technology and Development, a peer-reviewed international journal at the Asian Institute of Technology, Bangkok. Recent Notable Articles (Late 2025) Her recent reportage focuses heavily on judicial interventions and regional governance: 1. Environment & Governance "‘NGT can’t test legality of policy’: HC hears challenge to Punjab’s ‘Green Habitat’ plan" (Dec 22, 2025): Covering a critical legal battle over whether the National Green Tribunal has the authority to strike down a state policy regularizing farmhouses on delisted forest land. "High court pulls up Punjab poll panel over audio clip probe" (Dec 10, 2025): Reporting on judicial concerns regarding the transparency and fairness of local body elections. 2. Legal Rights & Social Welfare "HC issues notice to Punjab, Haryana over delay in building old age homes" (Dec 22, 2025): Reporting on a contempt petition against top officials for failing to establish government-run homes for the elderly as promised in 2019. "Victims can appeal acquittals in sessions court without seeking special leave" (Dec 19, 2025): Highlighting a significant procedural shift in criminal law following a Supreme Court ruling. "HC upholds benefits for Punjab FCI officer acquitted in 20-year-old bribery case" (Dec 19, 2025): A report on the concept of "honourable acquittal" and its impact on employee benefits. 3. Human Rights & Identity "As Punjab denies parole to MP Amritpal Singh, HC asks it to submit ‘foundational material’" (Dec 1, 2025): Covering the legal proceedings regarding the radical preacher and sitting MP's request to attend Parliament. "Protecting life paramount: HC backs Muslim woman in live-in after verbal divorce" (Nov 6, 2025): Analyzing judicial protections for personal liberty in the context of traditional practices. Signature Beats Manraj is recognized for her ability to decode complex judicial rulings and relate them to the everyday lives of citizens. Whether it is a 30-year-old land battle in Fazilka or the political implications of Kangana Ranaut’s candidacy in Mandi, her writing provides deep historical and regional context. Contact @grewal_sharma on X manrajgrewalsharma on Instagram ... Read More

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