BIKANER, Aug. 15 -- The state government will challenge a final notice by the Punjab government seeking Rs.1.44 lakh crore in allegedly unpaid water royalties from the state, reigniting a decades-old water dispute, officials said on Friday. The state has been given time till August 30 to make the payment. The notice was issued on August 10. Punjab water resources minister Barinder Kumar Goyal said that Rajasthan should honour its obligation to pay for the water it receives, pointing out that the state had made payments until 1961. He questioned why Rajasthan should object to paying when it charges for water used for agriculture, commercial purposes and industries. He added that Punjab bears losses when its rivers swell and said the state had suffered severe flooding last year. He said a legal team was working to initiate action in case of non-payment by August 30. The notice follows earlier correspondence from Punjab to Rajasthan on the issue. The dispute is rooted in a 1920 agreement involving the erstwhile princely states of Bikaner, Bahawalpur and British India, under which water was supplied to Bikaner. Punjab maintains that the pact provided for payment and that Rajasthan continued to draw the water after payments stopped in 1961. Earlier reports put Punjab's claim at Rs.1.44 lakh crore, calculated using updated rates and interest. The state government, however, has rejected the claim as baseless. Amarjeet Singh, Chief Engineer and Additional Secretary, Water Resources, and Secretary of the Indira Gandhi Nahar Board, said that the demand had nothing to do with the water pacts governing Rajasthan's current water entitlement. After Independence, new pacts were signed, he said, adding that the matter was pending before the tribunal....