HC slams brakes on PSPCL asset sale plan amid Rs 12,500-crore govt dues row

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Less than a month after issuing notice on a public interest litigation (PIL) alleging that massive unpaid electricity dues by government departments was pushing PSPCL into a severe financial crisis prompting plans to sell valuable public assets to cover up the shortfall, the Punjab and Haryana High Court on Friday stayed the move.The high court had on the previous date of hearing sought a response on the PIL alleging that its departments owed Punjab State Power Corporation Limited (PSPCL) electricity dues of Rs 2,582.24 crore as on the end of August 2025, apart from unpaid power subsidy exceeding Rs 10,000 crore.As the matter came up for hearing, the bench of Justice Ashwani Kumar Mishra and Justice Rohit Kapoor passed the order after hearing senior counsel Baltej Singh Sidhu. Petitioner Rajbir Singh’s counsel had earlier contended that the state despite being a consumer “like any other” failed to discharge its “moral, ethical and statutory obligation” to pay electricity charges, thereby crippling PSPCL’s finances. It was submitted that PSPCL, instead of exercising its statutory powers under Section 56 of the Electricity Act, 2003, had been compelled to raise loans running into hundreds of crores merely to meet routine operational expenses such as salaries, pensions and power purchases.“The Government of Punjab has failed to discharge its moral, ethical and statutory obligation to pay electricity dues, thereby pushing PSPCL into a severe financial crisis,” the petition stated, while seeking directions to PSPCL to immediately recover the default amount of Rs 2,582.24 crore along with interest and penalty from defaulting government departments.In the alternative, directions were sought to disconnect electricity supply to such departments by invoking powers under Section 56 of the Electricity Act after due notice. It also sought directions to the state government to “pay” the power subsidy bill of over Rs 10,000 crore.Raising a broader issue of public finance and asset protection, the petitioner also questioned the State’s policy of selling valuable public properties, including prime PSPCL land, under ‘Optimum Use of Vacant Government Land Scheme’ (OUVGL). Referring to decisions taken in meetings held on October 1, 2025, and subsequent communications, the petitioner alleged an intention to liquidate public assets described as the “family silver” to tide over a “self-created and avoidable” financial crisis.“Public properties are long-term national assets held in trust for future generations and cannot be sold for short-term fiscal management, particularly when recoverable dues of nearly equal magnitude remain unpaid by the state itself,” the petition said.The petitioner further flagged concerns over lands acquired from farmers and landowners for specific public purposes, which now stood vacant and were proposed to be sold for commercial exploitation. Such action, it was argued, violated the doctrine of public purpose and fairness.Maintaining that the petition involved no personal or private interest, the petitioner asserted that it had been filed bona fide to enforce statutory accountability, protect public finances, prevent dissipation of public assets and ensure that the burden of governmental defaults was not ultimately shifted onto ordinary electricity consumers.

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