Synopsis Irrigation through canals, wells and other sources is considered as a catalyst of economic development of a country. Numerous studies have confirmed on the role of irrigation in increasing crop productivity, intensity of cropping in India since the evolution of planning. However, it also helps in reducing instability in crop production, changes the cropping pattern in favour of high valued crops, reduces inequality in income among various section farmers in the society. Simultaneously, some scholars pointed out that the inequity in sharing gains of development resulting from investment in irrigation and some drew attention to the increase instability of farm output. Irrigation is not certainly considered as blessings on the mankind. Its side effect in the shape of water logging and salinity within the large canal commands have been considered as one of the important negative impact on the farms output. Based on the theoretical framework, the financial, economic, social and environmental aspects of the project are analysed by applying the familiar cost-benefit analysis technique.