Madras HC directs Tamil Nadu government to waive farmers' loans in cooperative banks

Sriparna Ghosh
Madras High Court

Wikimedia Commons/Milei.vencel

The Madras High Court has directed Tamil Nadu government to waive all farm loans taken from cooperative banks. The benefits of a similar HC order were earlier limited to those owning less than five acres of land.

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The court also directed officials not to initiate any penal or recovery proceedings against farmers who defaulted on the crop loans.

Though the ruling will increase the existing financial burden of the Tamil Nadu government by INR 1,980 crore, it will definitely bring some relief to the farmers who have been protesting at Jantar Mantar in Delhi for more than two weeks now.

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Back in 2016, the Tamil Nadu government had ordered the loan waiver scheme which had benefited 16.94 lakh marginal and small farmers who owned up to 2.5 acres and up to 5 acres of land, respectively.

A division bench of Justices S Nagamuthu and MV Muralidharan said on Tuesday that the scheme would now cover all farmers who took loans from primary agricultural cooperative banks till March 31, 2016 – irrespective of the land size.

The bench ruled, "We are aware that the financial situation of the state government is grim. The chief secretary in her letter to the advocate general also reiterated the same. The state government is already single handedly shouldered the burden to the tune of Rs 5,780 crore and it will be additional burden to bear Rs 1,980.33 crore.

"In this difficult situation, the central government cannot be a silent spectator. It should come forward to extend the help to the state government to share the burden. We are hopeful that the government of India will share the burden with the state government and extend maximum financial help to the state government to tide over the situation," it added.

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