Gurudwara Sri Bhuda Sahib stands in old Bilaspur city. Guru Tegh Bahadur Sahib Ji travelled here with his family, including Mata Gujri Ji and the young Guru Gobind Singh Ji, to attend the mourning for Raja Dip Chand of Bilaspur. The Dowager Rani Champa offered Guru Sahib a piece of land in her state, and Guru Sahib purchased the site, covering the villages of Lodhipur, Mianpur, and Sahota, for five hundred rupees.

On the mound of Makhowal, Guru Tegh Bahadur Sahib Ji raised a new settlement and named it Chak Nanaki, after his mother, Mata Nanaki Ji — the village that would later become famed as Sri Anandpur Sahib. When the original town was submerged in 1954 during the creation of the Bhakra Dam reservoir, Govind Sagar, a new town was built upslope, and this Gurudwara stands on land granted to the Sikh community in present-day Bilaspur city in remembrance of that history.