Why in news:

• The Supreme Court of India has agreed to consider listing the Punjab government’s plea seeking an urgent release of over Rs 1,000 crore from the Centre on account of dues of Market Fees and Rural Development Fees (RDF).

Key Points:

• A Bench led by CJI DY Chandrachud agreed to list the Punjab government’s interim application for an early hearing after the state government represented by the Additional Advocate General underlined that there is an urgent need for funds.

Rural Development Fund

• Rural Development Fund is the 3 per cent cess levied on the purchase or sale of agricultural produce under the Rural Development Fund Act, 1987 which is executed by Punjab Rural Development Board (PRDB) with the Chief Minister as its chairman.
• The fund comes mainly from central government’s purchase agency, Food Corporation of India. The Food Corporation of India buys around 13 million tonnes of wheat and 16 million tonnes of paddy every year.
• Usually Punjab gets Rs 1,750 crore every year — Rs 1,000 crore as 3% RDF for procuring paddy and the rest for wheat.
• This fund is supposed to be used for the creation and maintenance of rural infrastructure in and outside mandis. But there have been charges in the past that it was diverted by the state for other purposes.
• The central government has observed that the fund is being diverted. It has asked the state government to explain how it is utilising the fund. It has also not made any provision for this fund in the cost sheet that it has sent to the state.

Rural Development Board (RDB)

• The Rural Development Board was incorporated in 1987 under Rural Development Act, 1987.
• It is mandated with the promotion of better agriculture, and granting relief for the loss and damage to agricultural produce.
• It also provides the facility of streets lights, dharamshalas, panchayat ghars, canals, health infrastructure, sanitation, and government educational institutions in rural areas.