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8. Petitioners are admittedly agriculturists. They have obtained loans from the Bank under a particular Scheme and the Scheme held out a promise that interest on the loan is deferred for 7 years and during the gestation period no interest is actually payable; payment of interest is postponed and the accumulated interest of the gestation period is to be paid in instalments only thereafter. The period of gestation is the period during which petitioners do not derive any income from the rubber plantation. The Scheme was formulated to encourage rubber production in the Country. With this background in mind, if the position of the petitioners is weighed against that of the Bank, it is clear that the Bank is in a dominant position and has a superior bargaining power. The Bank is a Nationalised Bank; it advanced the loans in question in pursuance of the directions of NABARD, which is also an instrumentality of the State.

11. As to the first aspect, Annexure 'H' the Circular issued by the Head Office of the Bank to its Branches says:

"Branches are aware that the gestation period for horticulture and plantation crops range from 3 to 7 years depending upon the fruit bearing age. During the gestation period, the growers are not in a position to repay the interest. NABARD earlier used to defer the interest on refinance as long as the Bank does not recover the interest during the gestation period. Subsequently NABARD had permitted the Banks to charge interest on such deferred interest at the same rate as charged on the loans to the ultimate borrowers.
Further NABARD has also agreed to defer interest on refinance to the Banks and the deferred interest will be recovered by the NABARD at 6.5% or 8% per annum depending upon the purpose of the loan.
The charging of interest on deferred interest was again reviewed by the NABARD in consultation with the Reserve Bank of India.
NABARD has since reviewed the entire process of deferment of interest during the gestation period and has issued fresh guidelines to the Banks in consultation with the RBI, The revised guidelines on deferment of interest are as under:
A - area based scheme - The Branches shall defer interest during the gestation period and interest on deferred interest need not be charged. This procedure wilt become effective for the loans disbursed from 1st July 1988.
The Branches shall collect interest on deferred interest for the loans sanctioned and disbursed prior to 30th June 1988."

12. I do not find any peremptory direction of NABARD to the Bank to levy interest on deferred interest prior to 1.7.1987; NABARO has obviously left it to the discretion of the Bank, However, subsequent to 1.7.1987, no such discretion is given and the Bank cannot levy interest on deferred interest." In fact in the letter written by the NABARD to all the Banks on 27.5.1987 (Ann.C), it is stated that subsequent to 25.3.1967, NABARD had indicated that banks may charge interest on such deferred interest at the same rate as charged on the loans to the ultimate borrowers." The second aspect involves the validity of the differentiation made between the earlier loanees and the loanees who obtained, the loan after 1.7.1987, it is not the case of anyone before me that there is a difference between a person who obtained the loan to develop a rubber plantation prior to 1.7.1987 and after the said date. Nature of the cultivation and the gestation period are the same, whether development was initiated earlier or after 1.7.1987. In such a situation, treating the two set of persons, who are similar in nature regarding the loans obtained, would be a vice requiring surgery under Article 14 of the Constitution, The principle applied by the Supreme Court in D.S. NAKARA v. UNION OF INDIA, A1R 1983 SC 130 wherein an artificial date of retirement of pensioners to classify them was held to be arbitrary and the differential treatment meted out to one set of pensioners was rectified by the Supreme Court by applying Article 14 of the Constitution.