Chandigarh : The Punjab and Haryana high court has dismissed a public interest litigation (PIL) challenging the decision of the Greater Mohali Development Authority (GMADA) to borrow ₹2,500 crore from various urban development agencies in Punjab for infrastructure and land acquisition projects.
The PIL was filed in April by the Public Action Committee (PAC), a Ludhiana-based NGO, along with six associated individuals. The petition sought quashing an April 1 communication issued by the Punjab Urban Planning and Development Authority (PUDA), directing chief administrators of different development authorities to provide loans to GMADA on specified terms and conditions.
The communication stated that the arrangement had the approval of the Punjab chief secretary.
According to reports, the funds were proposed to be used for ongoing projects, including multiple blocks of Aerotropolis, Eco City-3, land acquisition for Aerotropolis Extension, and development works in sectors 87 and 103. The borrowing was aimed at maintaining the pace of development and avoiding delays in execution.
Under the proposed arrangement, the loan was structured for a period of three years with an interest rate of 7%. The contribution plan included ₹1,000 crore from the Greater Ludhiana Area Development Authority (GLADA), ₹300 crore from the Jalandhar Development Authority (JDA), ₹250 crore from the Patiala Development Authority (PDA), ₹200 crore from the Bathinda Development Authority (BDA), ₹150 crore each from the Amritsar Development Authority (ADA) and PUDA, besides ₹450 crore from GMADA’s own reserves.
The petitioners argued that the funds were being raised without authority under the Punjab Regional and Town Planning and Development Act, 1995.
{{/usCountry}}The petitioners argued that the funds were being raised without authority under the Punjab Regional and Town Planning and Development Act, 1995.
{{/usCountry}}During the hearing, the state questioned the maintainability of the PIL, contending that PAC was an unregistered body.
Rejecting the objection, the court observed that apart from the NGO, six individuals were also petitioners in the matter, making the PIL maintainable.
On merits, the court held that Sections 49 and 51 of the 1995 Act empower development authorities to create funds and borrow money from sources other than the state government. It observed that the phrase “such other sources” used in Section 51 was of the “widest import”, allowing authorities to borrow from any legitimate source available to them.
The court further noted that Section 41(1)(e) of the Act also permits authorities to create funds from “any other source”.
Holding that the April 1 communication had been issued with approval of the state government and was consistent with provisions of the 1995 law, the court said there was no ground to interfere and dismissed the PIL.