A public interest litigation (PIL) has been filed in the Punjab and Haryana high court (HC) demanding the summoning of records from Greater Area Mohali Development Authority (GMADA) over its proposed ₹15,000-crore borrowing plan and the move of appointing a Gujarat-based firm as fund arranger at a cost of ₹190 crore.
The PIL that also demanded the examination of the project-wise requirement, repayment capacity, existing debt and budgetary approvals for projects being executed by GMADA, was taken up by the HC bench of chief justice Ashwani Kumar Mishra and justice Rohit Kapoor.
Seeks to restrain state from using GMADA funds for populist functions
The presence of the Punjab accountant general has been requested for Tuesday’s hearing so that the government could “clarify facts”, specifically about the accountant general’s communication in June. The communication had raised questions about the transfer and accounting of ₹6,400 crore remitted by GMADA to the state treasury.
The PIL by Jaskirat Singh and others, mostly from Ludhiana, has also sought the quashing of the borrowing decision, besides restraining the state from utilising any part of the fresh borrowed proceeds of GMADA for “general state expenditure, political or populist purposes or other commitments unconnected with the statutory functions of GMADA”.
Freebies despite revenue deficit
{{/usCountry}}Freebies despite revenue deficit
{{/usCountry}}The PIL highlighted that the state budget for 2026-27 estimates a revenue deficit of ₹21,955 crore and a fiscal deficit of ₹39,971 crore. Net borrowings for the year are estimated at ₹38,471 crore and outstanding liabilities are estimated at about 45% of the gross state domestic product.
The government has also undertaken several large recurring subsidy and free-benefit commitments. It is to spend ₹15,550 crore towards power subsidy, ₹9,300 crore for the Mukh Mantri Mawan Dhian Satikar Yojana, ₹6,132 crore towards social assistance for old-age persons, widows and destitute women, ₹2,000 crore for the Mukhya Mantri Sehat Yojana, ₹900 crore for free quarterly ration kits under the Meri Rasoi Scheme, ₹600 crore for free bus travel for women and ₹313 crore for the Mukh Mantri Tirath Yatra Yojana, the petition claimed adding that state spent ₹317.17 crore on advertisements during the period from 2022 to March 2025.
“..the limited concern in the present petition is the source of money. If funds belonging to GMADA are transferred to the state treasury and GMADA is thereafter required to borrow large sums carrying interest and transaction costs, the burden remains on GMADA while corresponding fiscal space becomes available to the state. It is this financial arrangement, and not the merits of any welfare scheme, which requires judicial scrutiny,” it said, adding that immediately before this proposal, ₹2,500 crore was made available to GMADA by different agencies.
GMADA remitted ₹6,400 cr to state, claims PIL
The PIL claimed that during the 2025-26 financial year, ₹6,400 crore was remitted by GMADA to the state treasury. “The accountant general (audit-l), Punjab examined the transaction and issued a detailed communication dated June 3, 2026. The communication questioned the retrospective basis and accounting treatment of the remittances and objected to their credit as ordinary revenue instead of being dealt with under an appropriate purpose-specific accounting mechanism,” it said, adding that the accountant general further recorded that a sum of ₹927 crore had been demanded and transferred in relation to a scheme even though the scheme had not been formally announced at the relevant time.
The petition stressed that the figure of ₹15,000 crore must come from a project-wise calculation showing the amount presently payable, the stage of each acquisition, development cost, available internal resources, tranche-wise requirement and repayment source. The GMADA’s budget and accounts scrutiny committee material for the year 2025-26 shows ₹1,270 crore towards land acquisition and enhanced compensation, ₹641 crore towards development works and total major expenditure of ₹4,629 crore, including ₹2,400 crore towards repayment of principal loans.