The Punjab Government seems to be heading for a direct confrontation with the Union Government. Instead of immediately taking a decision on the issue pertaining to the implementation of Rent Control Act and imposition of house tax and user charges on drinking water and sewerage, as directed by the Centre, the Government has referred the matter to the two-member committee looking into the overall fiscal situation of the state.

The Ministry of Urban Development, Government of India, had earlier threatened to stop grants worth Rs 2,500 under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) if the state failed to comply with its directions.

According to sources, the Centre had also asked the state Government to deposit back the first instalment of Rs 355 crore released by the ministry some time ago.

The decision to refer the matter to the two-member committee of Deputy CM Sukhbir Singh Badal and Local Bodies Minister Manoranjan Kalia was taken in a meeting chaired by Chief Minister Parkash Singh Badal on Tuesday, said Principal Secretary (Local Bodies) D S Bains said. The committee formed recently to look into the fiscal situation of the state, including the subsidies issue, will submit its report within a month.

“This committee will now also look into the new Rent Control Act, house tax and user charges on sewerage and drinking water, since these also come under fiscal measures. It was felt in the meeting that a decision on implementing taxes could not be taken by officers,” said a Government official.

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