HC stays Sukhu Govt notifications diverting LADF for orphans’ welfare

Himachal Editor July 10, 2026 2 minutes read

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Shimla, July 10

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In a setback to the Sukhvinder Singh Sukhu-led Himachal Pradesh Government, the Himachal Pradesh High Court has stayed two State notifications that diverted a substantial share of the Local Area Development Fund (LADF) from hydropower project-affected areas to provide financial assistance to orphans, holding that the move prima facie appeared contrary to the objective of the policy.

A Division Bench comprising Chief Justice G.S. Sandhawalia and Justice Bipin C. Negi passed the interim order while hearing a Public Interest Litigation filed by Janak Raj on Thursday.

The petitioner’s counsel argued that under the Swaran Jayanti Energy Policy, 2021, the Local Area Development Fund is meant exclusively for infrastructure development and mitigation measures in areas affected by hydropower projects. The policy requires project developers to contribute 1.5 per cent of the project cost for projects above 5 MW and one per cent for projects up to 5 MW. In addition, one per cent of the revenue generated from power production is to be provided as an annuity throughout the life of the project.

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The petitioner submitted that the policy clearly identifies eligible works such as roads, drinking water schemes, schools, community halls, health centres, irrigation projects, bus stands and hospitals.

It specifically bars recurring expenditure, deployment of manpower, purchase of vehicles and grants or financial assistance to individuals from the LADF.

The court was informed that the State Government, through a notification dated September 23, 2025, earmarked 10 per cent of the LADF for orphan welfare through the Social Justice and Empowerment Department. A subsequent notification dated March 18, 2026, increased this allocation to 40 per cent.

Observing that the notifications did not indicate that the beneficiaries were restricted to the project-affected areas for which the fund was created, the Bench stayed both notifications. The matter has been tagged with CWPIL No. 76 of 2026 and would be heard on the next date.