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2011 Supreme(Online)(KER) 22854
HIGH COURT OF KERALA
C.K. ABDUL REHIM, J
SMT.NOORJAHAN – Appellant
Versus
UNION OF INDIA – Respondent
WP(C)/6513/2010
SRI.S.EASWARAN, SRI.M.A.AUGUSTINE, SRI.P.MURALEEDHARAN IRIMPANAM,OPERATIVE4) THE GRIEVANCE REDRESSAL OFFICER
Loans subject to arbitration can still qualify for waiver under agricultural debt relief schemes if they otherwise meet the eligibility criteria.
Headnote:
Debt Relief - Agricultural Loans - Cooperative Societies Act - Agricultural Debt Waiver and Debt Relief Scheme 2008 - Sections related to eligibility of loans for waiver considered - Loans availed before 31-03-2007 and overdue eligible for waiver under Ext.P2.
Fact of the Case:
Petitioner and her late husband availed two loans for land development and dairy business, defaulted, and faced recovery actions leading to arbitration awards. They sought debt relief under a government scheme but faced rejection based on eligibility.
Finding of the Court:
The court found the loans eligible for waiver under the debt relief scheme, as they met the stipulated conditions of being disbursed before the cutoff date and remaining overdue at the relevant times.
Issues: Whether the loans availed by the petitioner are eligible for benefits under the Agricultural Debt Waiver and Debt Relief Scheme, given the circumstances of arbitration awards.
Ratio Decidendi: The criteria for eligibility under the debt relief scheme do not exclude loans that have been subjected to arbitration. Payments made do not negate the eligibility of overdue portions of the loans.
Final Decision: The writ petition is allowed, and the rejection of the applications for waiver is quashed.
J U D G M E N T
Petitioner along with her late husband Sri.
Mohammadli had availed two distinct loans from the 3rd respondent Bank on 30-03-2004, to the tune of Rs.1,50,000/- and Rs.2,75,000/- respectively, for the purpose of land development and Dairy business. Consequent to default committed in re-payment, recovery steps were initiated by the 3rd respondent. On the basis of applications submitted by the 3rd respondent, the Arbitrator appointed under the Co-operative Societies Act (Assistant Registrar of Co- operative Societies, Chittur) had passed awards dated 24-02-2006, enabling realisation of a sum of Rs.1,83,934/- and Rs.2,91,450/- respectively. When sale proceedings were initiated in execution of the awards, the petitioner along with her husband had approached this court in W.P (c) No.24940/2007 and in W.P (c) No.2024/2007. This court passed an interim order subject to condition of the W.P.(c) No.6513/2010 -2-
petitioner and her husband remitting a sum of Rs.30,000/- and Rs.25,000/-, respectively. In compliance with the interim order the remittances were made, as evident from Ext.P1 receipt. In the meanwhile, the Central Government have introduced Ext.P2 scheme, namely “Agricultural Debt Waiver and Debt Relief Scheme, 2008.” Since the loan accounts in default will fall within the eligible category under Ext.P2 scheme, they submitted applications before the 4th respondent, who is the 'Grievance Redressal Officer' under Ext.P2 scheme, as per Exts.P3 and P4. When those applications were not considered the Petitioner and her husband had approached this court again in W.P (c) No.22714/2009. In Ext.P6 judgment this court directed the 4th respondent to consider and pass orders on Ext.P3 and P4 within a time limit stipulated. But the 4th respondent had rejected the claims stating that the loans in question will not come within the purview of Ext.P2 scheme. In this writ petition the petitioner is challenging the said decision taken under Exts.P8 and P9.
W.P.(c) No.6513/2010 -3-
2. Contention of the petitioner is that the loans availed by the petitioner and her husband were in the nature of investment loans categorised under clause 3.3 of Ext.P2 scheme. It is further contended that the amounts due under the loan accounts will fall within the category mentioned under Clause 4.1 (b) (i) of Ext.P2, since the loans were disbursed prior to 31-03-2007 and it remained over due as on 31st December 2007, and further it remained unpaid till 29-02-2008. It is contended that the loans were availed in the year 2004 and the awards of the Arbitrator were passed on 24-02-2006. Therefore, the loans were remaining over due as on 31-12-2007 and it was remaining unpaid as on 29-02-2008. It is contended that Exts.P8 and P9 are cryptic orders issued by the 4th respondent in which no reasoning is mentioned for rejection of the claims for waiver.
3. Learned counsel appearing for the 3rd and 4th respondents contended that any loans with respect to which award is passed by the Arbitrator under the Co-operative Societies Act, will not fall within the eligible category under W.P.(c) No.6513/2010 -4-
Ext.P2. It is also contended that since the petitioner as well as her husband had remitted a part of the amount as evidenced from Ext.P1 the loans in question could not be categorised as loans remaining over due for payment.
4. On a perusal of the various clauses in Ext.P2 scheme, I notice that the benefits are available to, direct agricultural loans, short term production loans and investment loans which satisfied the different parameters prescribed under the scheme. Clause 4 of Ext.P2 prescribes the details of eligible amount for waiver or debt relief. As mentioned above, under Clause 4.1 (b) (i), the amount eligible for waiver in the case of investment loans is the installments remaining overdue together with applicable interest of such installments. The only condition stipulated is that, for coming within the eligible category the loan should have disbursed before 3
