New Delhi : , Tuesday, November 23rd : .The Supreme Court upheld the scheme by Tamil Nadu to waive crop loans — long-term (farm sector) and medium-term (agriculture) — for small and marginal farmers. The court of appeal noted that small and marginal farmers (with less than five acres of land) suffer a greater degree of damage and are therefore entitled to receive the benefits of the scheme.
A bench comprising justices D.Y.Chandrachud, A.S.Bopanna stated that the small- and marginal farmers are part of the economically less fortunate sections of society.The loan waiver program targets economically poorer rural sections.
According to the bench, the waiver of agricultural loans was made in order to assist farmers who are struggling due to erratic weather, low yields, or fall in prices because market conditions.
Further, the bench stated that because of the unique degree of harm that small- and marginal farmers suffer compared with other farmers it was justifiable to limit the benefits of the scheme to a specific class.
Tamil Nadu’s government claimed that small and marginal farmers consume more than their income estimates, so borrowings can be used to cover the gap.It was noted by the bench that Article 38 clearly recognizes the goal of encouraging the welfare of farmers to ensure economic and social justice.
Chandrachud who wrote the judgement on behalf of the bench stated, “Therefore the classification based upon the extent of landholding [is not arbitrarily] since, owing to inherently disadvantaged status of small and marginal farmers the impact of climate changes or other external forces are unequal.”
It was noted that 16.94,145 marginal and small farmers had availed loans for agricultural purposes, whereas the 3,01,926 other farmers were able to borrow.This shows that marginal and small farmers are in a greater capital shortfall than the rest.It was noted by the bench that law and government schemes cannot be tested against the anvils of majority morality, but can only be challenged on the basis of constitutional morality.
A report showing that land less than 0.01 hectare is used 93.1 percent of agricultural loans to non-agricultural purposes by households was also mentioned.Contrary to this, households with 10 hectares of land use 17.1 percent of agricultural loans for non-agricultural uses.
The bench stated that “This shows the poverty that surrounds the small- and marginal farmers.”
It was noted by the bench that the scheme had been introduced to fulfill an electoral promise of the Tamil Nadu party at the time.
The bench noted that “it is settled law that a scheme can’t be held Constitutionally suspect simply because it is based upon an electoral promise.”
Also, the Madras High Court ruling of April 4, 2017 that granted loan waivers to marginal and small farmers was thrown out by the top court.The government was directed to give the same benefit to all farmers regardless of their landholding.
The Tamil Nadu government granted waivers of crop loans to marginal and small farmers on May 13, 2016.For the classification of farmers, it was necessary to consider the amount of landholding that had been recorded in both the loan register and the landholding register.
Small farmers are those who have land between 2.5 and 5 acres.Marginal farmers, on the other hand, refer to any farmer with land less than 2.5 acres.For violating Article 14 of Constitution, the National South Indian River Interlinking Agriculturist Association challenged the scheme and requested a directive to grant loan waivers to all farmers regardless of their landholding.
The high court heard that the AIADMK made an electoral promise and implemented the scheme after it was elected to power.
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