Debt Relief – Debt Relief Scheme for agriculturists – The appellants-farmers took a loan from the first respondent for purchasing a tractor – Appellants sought a waiver of loan under the notified schemes – However, their claim was denied – The District Forum held that appellants fell in the category of small farmers and amount was waived – However, the National Commission denied complete waiver of loan – On appeal, held: The National Commission came to the contrary conclusion on the sole ground that the land of the appellants was situated in the district which was not included in Annexure-I u/cl. 6 of the scheme – However, the appellants had made claim u/cl.5 and not u/cl.6 – Therefore, the finding of the National Commission was erroneous – Further, explanation 2 to the definition of the marginal farmer, small farmer and other farmer provided that the largest land holding in the pool shall be the basis for the classification of all farmers – u/cl. 3.6 of the scheme, a ‘small farmer’ meant a farmer cultivating agricultural land of more than 1 hectare and upto 2 hectares (5 acres) – In the instant case, both the farmers had a holding of 38 Kanals eleven marlas each – The District Forum had carefully evaluated this aspect and came to the conclusion that the largest of the landholdings of the two appellants was 4 acres 6 kanals and eleven marlas and hence both the appellants fell in the category of small farmers – The findings was in terms of the provisions and was correct – Thus, the judgment of the National Commission set aside and the order of the District Forum which was confirmed in appeal by the State restored. The appellants-farmers took a loan from the first respondent in 2008 for purchasing a tractor. The loan remained outstanding. Thereafter, an Agricultural Debt Waiver and Debt Relief schemes were notified. The farmers were categorised into three categories: (1) marginal farmer; (ii) small farmers and (iii) other farmers. The appellants claimed that they were ‘small farmers’ and sought a waiver of loan u/cl.5 of the scheme. Bank declined to accede to the claim for waiver. The appellants filed a complaint before the District Consumer Disputes Redressal Forum. The District Forum held that the appellants were in the category of small farmers and the entire outstanding loan amount was waived. The State Commission agreed with the view of the District Forum. However, the National Commission came to a contrary conclusion and denied complete a waiver of loan.
Allowing the appeal, the Court
HELD: 1. For the purpose of the present case, Clause 3.6 of the scheme which defines the expression ‘small farmer’ is relevant. A small farmer is a farmer cultivating agricultural land of more than 1 hectare and upto 2 hectares (5 acres). The expression ‘other farmer’ covers those farmer whose holding is in excess of five acres. Where a borrowing is by more than one farmer all of whom have pooled their land, explanation 2 provides that the largest landholding in the pool shall be the basis for the classification of all farmers in that pool as marginal, small or other farmers. This explanation indicates that where both the appellants have pooled their landholding for the purpose of loan, the largest landholding amongst them would be taken into consideration for classifying them in the appropriate category. The District Forum carefully evaluated this aspect and came to the conclusion that the largest of the landholdings of the two appellants was four acres six kanals and eleven marlas and, hence both the appellants would fall in the category of ‘small farmer’ and not in the category of ‘other farmer’. This finding is in terms of the provisions and is correct. The State Commission has also entered a similar finding. [Para 15] [41-G-H; 42-A-C]
2. The appellants claimed a debt waiver on the ground that they were small farmers. The entire eligible amount was liable to be waived in terms of Clause 5. The National Commission proceeded on the basis that the Scheme was applicable only to certain districts in the State of Haryana and since Faridabad is not a district listed in Annexure-I, the appellants were not entitled to any relief. This finding is erroneous. The relief provided in Clause 6 is in the form of a one time settlement where a farmer is given a rebate of twenty- five per cent of the loan amount. However, under the proviso, in the case of revenue districts listed in Annexure-I, the OTS rebate is to be twentyfive per cent of the eligible amount of Rs.20,000, whichever is higher. The issue as to whether the landholding of the claimant falls in one of the listed districts of Annexure-I, is relevant for the purpose of Clause 6 of the Scheme. The appellants did not make any claim under Clause 6. Their claim was under clause
5. The National Commission was in error in holding the appellants to be ineligible on the basis that the district of Faridabad has not been listed in Annexure-I. [Para 18] [42-FH; 43-A-C]
3. That leaves the Court with the submission of the respondent based on explanation 3 to the definitions. Explanation
3 applies to a farmer who has obtained investment credit for allied activities. Clause 3.1 contains a definition of direct agricultural loans and covers short term production loans and investment loans provided directly to farmers for agricultural purposes. Clause 3.3(a) brings within the purview of an investment loan, investment credit for direct agricultural activities including the purchase of a tractor. The loan which was extended to the appellants was for the purchase of a tractor. It was a loan for allied activities and hence, explanation 3 has no application. [Para 19][43-B-E]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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