Karnataka | September 11, 2026
The Karnataka government has decided to approach the Supreme Court against the Centre over the alleged withholding of ₹2,186.20 crore in 15th Finance Commission grants due to gram panchayats for 2025–26, Rural Development and Panchayat Raj Minister Eshwar Khandre said on Thursday.
Khandre announced the decision after discussions with department officials on the release of central grants. He also consulted Advocate General Shashikiran Shetty and department secretary D. Randeep on the legal grounds for challenging the Centre’s action.
According to the minister, the amount was recommended for gram panchayats under the 15th Finance Commission. The state government maintains that the funds have not been released and intends to question what it described as an unjust withholding of Karnataka’s share before the Supreme Court.
The dispute comes as the state is dealing with a rainfall deficit and drinking-water shortages in parts of rural Karnataka. Khandre said 710 villages were facing drinking-water problems. He added that water was being supplied by tankers to 149 villages and that the state had hired 561 private borewells to meet local demand.
The minister also referred to crop-related distress, saying that seeds sown by farmers had failed to germinate in some areas. He said these circumstances would form part of the consultations on the legal issues involved in seeking the release of the grant money.
The 15th Finance Commission grants are intended to support local governments, including gram panchayats. The report did not specify when the state would file its petition, whether the Centre had formally communicated a reason for withholding the funds, or whether the Union government had responded to Karnataka’s position.
Khandre also said the state was preparing to hold elections to gram panchayats, taluk panchayats and zilla panchayats whose terms had ended. Preparatory work had been delayed because government staff had been assigned to the Special Intensive Revision, he said.
The government is fully prepared for gram panchayat elections, according to the minister. A preliminary notification is expected to be issued soon, he said.
