Punjab moves Supreme Court against Central government over non-reimbursement of fees levied for food grain procurement
The Punjab government has filed a suit before the Supreme Court against the Central government over the non-reimbursement of statutory fees allegedly running into over ₹4,000 crores that the State government had levied on behalf of the Central government during the procurement of food grains.
In its plea which is an original suit under Article 131 of the Constitution, the State of Punjab has raised grievance against the Central government for refusing to transfer back the statutory Market Fees and Rural Development Fees levied by the State on behalf of the Centre during the procurement of food grains.
"The defendant (Central government) is refusing to pay the Market Fees and RDF, even though it is constitutionally validly imposed/levied by the Plaintiff State under Article 246(3) of the Constitution of India," the suit stated.
The levies are key to bearing the expenses of acquiring food grains with minimum transition losses, the State government explained.
Despite multiple correspondences, the Central government has not reimbursed an amount of over ₹4,000 crores, which dates back to 2021, the Punjab government further claimed.
Instead, the State submitted that it was asked to reduce the levy percentage and spend it only on rural and agricultural needs, despite this domain being the sole prerogative of the State government.
Moreover, the Central government’s actions are also in violation of the Modified Fixation Principles in place since February 24, 2020, the State government said.
In this regard, it was pointed out that these principles aim to recognize the autonomy of the State government to determine the fees to be levied, which are then subsequently reimbursed by the Central government.
"The mere fact that this fee is being in respect of acquisition, which the Plaintiff State is carrying out for the Defendant, does not in any way change this underlying constitutional/legal position," the suit added.
The suit has been settled by Senior Advocate Dr Abhishek Manu Singhvi and filed through advocate Ajay Pal. It was drafted by the office of the Law Chambers of Advocate Shadan Farasat.