Karnataka High Court
Shivanand B. Malagar vs The Reserve Bank Of India, Bangalore on 5 February, 2014
Author: Mohan M Shantanagoudar
Bench: Mohan .M. Shantanagoudar
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IN THE HIGH COURT OF KARNATAKA
GULBARGA BENCH
TH
DATED THIS THE 5 DAY OF FEBRUARY 2014
BEFORE
THE HON'BLE MR.JUSTICE MOHAN .M. SHANTANAGOUDAR
WRIT PETITION No.83427/2009 (GM-RES)
BETWEEN:
SHIVANAND B. MALAGAR
AGE: 40 YEARS, OCC: AGRICULTURE
AT POST: LONI BK
TQ. INDI, DIST. BIJAPUR
... PETITIONER
(BY SRI AMARESH S. ROJA, ADVOCATE)
AND:
1. THE RESERVE BANK OF INDIA
NRUPATUNGA ROAD
BANGALORE-1
2. THE BRANCH MANAGER
ANDHRA BANK
NEAR S.S. HIGH SCHOOL
B.L.D.E. ROAD
BIJAPUR - 586 101
... RESPONDENTS
(BY SRI A.M. NAGARAL, ADVOCATE FOR
SRI R.A. PATIL, ADVOCATE FOR R1;
SRI CHAITANYA KUMAR, ADVOCATE FOR R2)
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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING
THE NOTICE DATED 16.08.2008 VIDE ANNEXURE-D DATED
10.06.2006 IN NO.1236 ISSUED BY THE 2ND RESPONDENT AT
ANNEXURE-D1 AND ETC.
THIS PETITION COMING ON FOR PRELIMINARY HEARING
IN 'B' GROUP THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
Petitioner has sought for quashing the notice at Annexures-D and D1 dated 16.08.2008 and 10.06.2009 respectively issued by the second respondent. He has also sought for a direction to the first respondent to implement the scheme i.e., Agricultural Debt Waiver and Debt Relief Scheme, 2008, by giving direction to the second respondent for waiving loan of the petitioner in the interest of justice.
2. Petitioner obtained loan to an extent of Rs.7,50,000/- for purchasing of tractor trailer. He is the owner and in cultivation of Sy.No.33 to the extent of -3- 3 acres 20 guntas situated at Kanchnal, Hobli:
Chadachan, Tq. Indi, Dist. Bijapur. Though he paid the amount of Rs.86,000/- in installments up to 21.10.2007, he could not repay the entire loan amount.
In the meanwhile, Central Government formulated the scheme called as "Agriculture debt waiver and debt relief scheme 2008". According to the petitioner, in the said scheme, nature of investment in loan i.e., purchase of tractor is covered by the debt waiver. The grievance of the petitioner is that the respondents instead of according benefit to the petitioner under aforementioned scheme have resorted to recovery of the loan from the petitioner by sending notices at Annexures-D and D1. Thus, this writ petition is filed praying for quashing the said notice and for consequential relief.
3. Annexure-D is a letter dated 16.08.2008 issued by the second respondent - Bank to the petitioner instructing the petitioner to sign certain records for -4- getting waiver benefits to certain extent. The same does not actually harm the petitioner. However, under notice at Annexure-D1 dated 10.06.2009, petitioner is called upon by the second respondent - Bank to pay 75% of the outstanding loan amount under one time settlement scheme so as to get the benefit of exemption of remaining 25% of the loan. Petitioner is aggrieved by the said notice.
4. Sri Amaresh S. Roja, learned counsel for the petitioner relying upon the scheme of 2008 contends that the petitioner falls within the definition of 'small farmer', inasmuch as, he has got land less than 5 acres. He further submits that debt waiver facility is available in case of small and marginal farmers. Since the petitioner is a small farmer, the entire eligible amount shall be waived.
5. The writ petition is opposed by the learned Advocates Sri A.M.Nagaral and Sri Chaitanya Kumar by -5- contending that though the petitioner is a small farmer as contemplated under the scheme of 2008, he would be classified as 'other farmer' since the loan obtained by the petitioner exceeds Rs.50,000/-. Thus, according to them, petitioner is not entitled to the complete waiver of the loan but he is entitled to waiver of loan up to 25% under one time settlement scheme.
6. Before proceeding further, it is relevant to note certain paragraphs in Agricultural Debt Waiver and Debt Relief Scheme, 2008, to decide this case.
2.1 The Scheme will cover direct agricultural loans extended to 'marginal and small farmers' and 'other farmers' by Scheduled Commercial Banks, Regional Rural Banks, Cooperative Credit Institutions (including Urban Cooperative Banks) and Local Area Banks (hereinafter referred to compendiously as "lending institutions") as indicated in the Guidelines.
3.3. 'Investment Loan' means -6-
(a) Investment credit for direct agricultural activities extended for meeting outlays relating to the replacement and maintenance of wasting assets and for capital investment designed to increase the output from the land, e.g. deepening of wells, sinking of new wells, installation of pump sets, purchase of tractor/pair of bullocks, land development and term loan for traditional and non-traditional plantations and horticulture; and 3.5 'Marginal Farmer' means a farmer cultivating (as owner or tenant or share cropper) agricultural and up to 1 hectare (2.5 acres).
3.6. 'Small Farmer' means a farmer cultivating (as owner or tenant or share cropper) agricultural land of more than 1 hectare and up to 2 hectares (5 acres).
3.7. 'Other Farmer' means a farmer cultivating (as owner or tenant or share -7- cropper) agricultural land of more than 2 hectares (more than 5 acres).
Explanation:
3. In the case of a farmer who has obtained investment credit for allied activities where the principal loan amount does not exceed Rs.50,000, he would be classified as "small and marginal farmer" and, where the principal amount exceeds Rs.50,000, he would be classified as 'other farmer', irrespective in both cases of the size of the land holding, if any.
5. Debt Waiver 5.1 In the case of a small or marginal farmer, the entire 'eligible amount' shall be waived.
6. Debt Relief 6.1. In the case of 'other farmers', there will be a one time settlement (OTS) Scheme under which the farmer will be given a rebate of 25 per cent of the 'eligible amount' subject -8- to the condition that the farmer pays the balance of 75 per cent of the 'eligible amount;
Provided that in the case of revenue districts listed in Annex-I, 'other farmers' will be given OTS rebate of 25 per cent of the 'eligible amount' or Rs.20,000, whichever is higher, subject to the condition that the farmer pays the balance of the 'eligible amount'."
7. From paragraph 2.1 quoted supra it is clear that the scheme will cover the agricultural loans extended to 'marginal and small farmers and other farmers' by certain of the banks including Co-operative Credit Institutions and Scheduled Commercial Banks. Respondent No.2 is a scheduled commercial bank. Thus, agricultural loans offered by the second respondent - Bank is covered under the scheme. Paragraph 3.1 further clarifies that the investment credit for agricultural activities extended for meeting the expenses of purchase of tractor also comes under -9- investment loan. Thus, loan in question obtained for purchase of tractor is investment loan. Petitioner who is having 3 acres 20 guntas of land (3.5 acres) falls within the definition of 'small farmer' as is clear from paragraph 3.6. The word 'other farmer' is defined to mean a farmer cultivating more than 5 acres. Under explanation (3) it is further clear that incase of a farmer who has obtained investment loan of more than Rs.50,000/- he would be classified as 'other farmer' irrespective of size of the land holding. Thus, if a small farmer having land of 3.5 acres obtains loan of more than Rs.50,000/-, he will be categorized and classified as 'other farmer' for the purpose of scheme. Undisputedly, in the matter on hand, petitioner has obtained loan of Rs.7,50,000/- i.e., more than Rs.50,000/-. Thus, though the petitioner is having 3.5 acres of land, shall be classified as 'other farmer' for the purpose of the scheme. Paragraph 5 of the scheme clearly states that incase of small or marginal farmer,
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the entire eligible amount will be waived. Had the petitioner obtained loan of less than Rs.50,000/- he would have continued under the head of 'small farmer' and his entire eligible amount would have been waived. But in the matter on hand, since the petitioner has obtained loan of more than Rs.50,000/-, he would not fall under the head 'small farmer' consequently, the entire eligible amount cannot be waived. Under paragraph 6.1, the 'other farmers' are entitled to one time settlement scheme (OTS) under which the 'other farmers' will be given rebate of 25% of the eligible amount subject to the condition that the farmer pays the balance of 75% of the eligible amount. In the matter on hand, petitioner is entitled to the benefit of paragraph 6.1 of the scheme and not paragraph 5.1 of the scheme. Therefore, petitioner shall be classified as 'other farmer' because he obtained loan of more than Rs.50,000/-, and hence he is entitled to one time settlement and he will be given rebate of 25% of the
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eligible amount subject to he depositing 75% remaining eligible amount. Therefore, the petitioner is entitled to the relief as contemplated under paragraph 6.1 of the scheme.
In view of the above, the second respondent - bank is justified in calling upon the petitioner by issuing notice at Annexure-D1 to pay 75% of the eligible amount for getting the rebate of 25% of the eligible amount. Since the notice at Annexure-D1 is just and proper and the same is in accordance with the scheme, no interference is called for.
Accordingly, the petition fails and the same stands dismissed.
Sd/-
JUDGE NB*