The Union government on Friday told the Kerala High Court that it will free up Rs 120 crore in arrears owed by the state government to it for rehabilitation and relief efforts in Wayanad district, Bar and Bench reported.

At least 400 persons were killed because of landslides triggered by heavy rain in the Meppadi area in the district in July.

A division bench of Justices AK Jayasankaran Nambiar and Easwaran S has been hearing a suo motu case to monitor the rehabilitation efforts in Wayanad. At previous hearings, the state government and the Union government had clashed over delays in securing financial assistance for relief activities.

The Kerala government had Rs 782.9 crore available in the State Disaster Response Fund, Live Law reported. However, the amount could not be utilised for the rehabilitation efforts due to the debt the state government owed to the Centre, PTI reported.

On December 18, the bench urged the Union government to release Rs 120 crore for Wayanad from the Rs 132 crore in dues owed by the state government for airlifting services provided by the Indian Air Force since 2006, PTI reported.

On Friday, Additional Solicitor General ARL Sundaresan, representing the Centre, told the court that Section 20 of the 2005 Disaster Management Act allowed the state government to avail the option, Bar and Bench reported.

Section 20 of the Act pertains to the formation of a state executive committee to assist in disaster management. The committee was empowered to postpone payments related to airlifting services and use that money for rehabilitation, Sundaresan said.

He added that the Centre had sent a letter to the state government on January 2 for freeing up the funds for use in Wayanad, according to Live Law.

“The central government essentially accepts the proposal that was mooted by us in our previous order and has agreed to the freeing up of the amount of Rs 120 crore for immediate use of the state government in connection with the ongoing rehabilitation proceedings at Wayanad,” the court said.

“The said amount can be used, in relaxation of the SDRF [State Disaster Response Fund] and NDRF [National Disaster Response Fund] norms of the central government,” it added.

The Commissioner of Kerala State Disaster Management Authority also told the court that the landslide in Meppadi had been classified as a disaster of “severe nature” following an assessment by an inter-ministerial central team, PTI reported.

This meant the Kerala government could now access several funding sources for rehabilitation efforts in Wayanad, including the Member of Parliament Local Area Development Funds and the fund that provides for Special Assistance to States for Capital Investment, the commission said.

At an earlier hearing, the Union government had said that Kerala could use the funds remaining in the State Disaster Relief Fund to meet its immediate needs, Bar and Bench reported. It said that additional financial assistance would be given only after a final assessment by an expert committee.

The matter will be next heard on January 16.