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A longstanding dispute between Punjab and Himachal Pradesh over the ownership of the Shanan hydropower project has escalated, leading to legal intervention by both parties.
As the 99-year-old lease of the project expired on March 2, the Centre has issued orders to maintain status quo until a final decision is reached.

Shanan Hydropower Project and the Dispute

Location: It is located on the Uhl River, a tributary of the Beas River, in Mandi district, Himachal Pradesh, India.
British-era Lease: The 110-MW Shanan hydel project was leased to Punjab in 1925 by the then-ruler of Mandi, Raja Joginder Bahadur, under a 99-year lease agreement.
Competing Claims: Himachal Pradesh contends that the project should revert to its control upon the expiry of the lease, citing historical and legal grounds for its claim.
Economic Significance: The project has significant economic implications for both states, contributing to their power generation capacities and regional development.

Historical Ownership: The project historically supplied power to undivided Punjab and Delhi before Independence, and it was allocated to Punjab during the reorganization of states in 1966.
Legal Basis: Punjab asserts its legal control over the project under the provisions of the Punjab Reorganisation Act, 1966, reinforced by a central notification issued in 1967.
Utilization of Resources: Punjab argues that it has invested in the maintenance and operation of the project, making it a vital component of its energy infrastructure.

Supreme Court Petition: Punjab has filed a suit in the Supreme Court, seeking a permanent injunction against Himachal Pradesh from disturbing its lawful possession of the project.
Interim Status Quo Order: The Centre, invoking its powers under relevant laws, has ordered the status quo on the project’s functioning until a final decision is made, emphasizing the public interest in maintaining stability.
Legal Interpretation: The interpretation of historical agreements and legislative acts will be pivotal in determining the rightful ownership of the project.

Interim Measure: The Centre’s order is an interim measure to prevent disruption in the functioning of the Shanan Power House until the dispute is resolved.
Legal Framework: Both parties are expected to proceed further within the legal framework to settle the dispute, ensuring adherence to due process and fairness.
Regional Cooperation: A collaborative approach between Punjab and Himachal Pradesh, facilitated by federal authorities, could lead to a mutually beneficial resolution and promote inter-state harmony.