Overview
- The High Court of Jammu and Kashmir and Ladakh issued the ruling on October 29, 2026, holding provisions of the 2010 Water Resources Act ultra vires where they imposed charges on hydropower producers.
- The court quashed all government demand notices issued since 2010 against the petitioning independent producers and barred the UT administration from imposing taxes on electricity generation in the form of similar levies going forward.
- Judges Rajnesh Oswal and Sanjay Dhar found the Water Resources Regulatory Authority fixed charges by head height and turbine propulsion rather than by the volume of water used, a method that showed the levy targeted power generation rather than water regulation.
- The bench rejected the UT’s argument that adoption of the 2010 law under the Jammu and Kashmir Reorganisation Act, 2019 validated the provisions and relied on precedent that a law void ab initio cannot be cured by later parliamentary adoption.
- The decision ends a long legal fight by 11 independent producers and removes a revenue measure the government said could yield about ₹850 crore a year, giving immediate relief to project operators and leaving open the prospect of an administrative appeal or new legislative measures.