New Delhi
The Supreme Court has asked Attorney General KK Venugopal to explore the possibility of an amicable solution to Himachal Pradesh’s demand for a huge compensation for the losses incurred by it due to construction of the Bhakra-Nangal and Beas projects on its land.

“We request the AG to go through the matter to find an amicable settlement regarding the liability of the payment of Punjab and Haryana to Himachal,” a Bench of Justices RK Agrawal and Abhay Manohar Sapre said in its September 21 order.

Directing the states to depute “some responsible officer” on the date to be fixed by Venugopal, the Bench posted the matter for hearing after six weeks.

Senior counsel Jagdeep Dhankhar, representing Haryana, submitted that the issue needed to be determined within the four corners of the Punjab Reorganisation Act, 1956.

The top court is seized of an original suit filed by Himachal in 1996 against the Centre, Punjab and Haryana demanding its entitlements following the completion of the projects.

Due to construction of the Bhakra Dam over the Sutlej, submergence and reservoir of water over large areas of land resulted in a loss of over 10,000 acres of cultivated and uncultivated land — trees and forests, towns and government buildings included — leading to unemployment, loss of agricultural and trading activity and revenue.

Similarly, the construction of Pong Dam across the Beas led to submergence of over 6,500 acres of land in Kangra.

Himachal Pradesh is seeking a compensation of Rs 2,199.77 crore from the Centre, Punjab, Haryana, Union Territory of Chandigarh and Rajasthan, in addition to 12 per cent share in power generated by the two projects free of cost under the Act.

In 2011, the top court held that Himachal Pradesh was not entitled to get 12 per cent free power from the Centre on the basis of the projects located within its territory and said it would get only 7.19 per cent power. It said compensation to Himachal Pradesh would carry 6 per cent interest. But both Punjab and Haryana contended Himachal Pradesh was liable to share 7.19% of the total cost incurred on the two projects.

The SC had directed the Centre to evaluate rights and liabilities of Himachal Pradesh, Punjab and Haryana in terms of the 1956 Act. The Centre submitted an affidavit in compliance of the directive after computing rights and liabilities by taking five different rates for the power tariff.

In 2013, the Centre told the top court that Punjab and Haryana would have to pay compensation in the ratio of 58:42 to Himachal for short supply of electricity from the two projects since 1966. Or, Punjab and Haryana could compensate HP by allotting additional energy over a period of 30 years if they had any difficulty in making payment, the Centre had told the court.