The Himachal Pradesh High Court has restrained the state government from taking coercive action against Punjab State Power Corporation Limited (PSPCL) under the newly introduced Specially Assessed Land Revenue regime. While issuing a notice to the state government on a writ petition filed by the PSPCL challenging the constitutional validity of the Himachal Pradesh Land Revenue (Amendment) Ordinance, 2025, and the related Rules, a Division Bench comprising Justice Vivek Singh Thakur and Justice Ranjan Sharma issued directions that no coercive steps would be taken against the petitioner pursuant to the impugned proceedings until the next date of hearing.
The PSPCL filed the petition assailing the constitutional validity of the Himachal Pradesh Land Revenue (Amendment) Ordinance, 2025, the Himachal Pradesh Land Revenue (Special Assessment) Amendment Rules, 2025, the implementation notification dated December 10, 2025, the Final Land Revenue Special Assessment Report dated February 2, 2026, and the consequential demand notice dated March 6, 2026, whereby a demand of Rs 16.324 crore had been raised in respect of the Shanan hydroelectric power project.
According to the petitioner, the impugned legislative framework, though styled as a land revenue levy, is in substance a tax on electricity generation, as the assessment is based on the “Average Market Value of the Project” rather than any recognised principle governing the assessment of the land revenue. It has been contended that the levy lacks a rational nexus with land and therefore travels beyond the legislative competence of the state.
The PSPCL alleged that the impugned enactments were a colourable exercise of legislative power and effectively seek to reintroduce, in another form, the levy imposed under the Himachal Pradesh Water Cess on Hydropower Generation Act, 2023, which the High Court had earlier declared unconstitutional. The matter has been listed for further hearing on July 23.
