The Kerala High Court in the case K Sivanandhan V State of Kerala and other matters observed and has held that the farmers who sell their paddy to the Government of Kerala through Supplyco i.e., the Kerala State Civil Supplies Corporation under the tripartite agreement cannot be treated as borrowers.
The court in the case noted that the tripartite agreement, Supplyco has to obtain loan from the bank to make payments to the farmers, so Supplyco is the borrower and not the farmers.
The bench headed by Justice Devan Ramachandran in the case obserevd and has clarified that farmers cannot be shown as borrowers in the paddy receipt sheet under the paddy procurement scheme and their credit rating should not be affected. However, the judgement of the said court is explicitly clear and the farmer under the PRS scheme cannot be construed as borrower in any manner, whatsoever, whether it has been done prior to this issue or after.
In the present case, the court passed the above order while considering a batch of writ pleas moved by aggrieved farmers who sold their paddy to the State Government through Supplyco but have not received any payment in return. The court in the case observed and has directed payments to be disbursed to the farmers without delay.
The said matter was posted yesterday in order to ensure that the order was complied with. Thus, the court was also informed that the farmers are being treated as borrowers by the banks under the paddy procurement scheme and their credit ratings are also affected.
The counsel appearing Suplyco submitted before the court that as to why the consortium of banks was not informed through appropriate proceedings that farmers are not borrowers in the paddy procurement scheme.
The court in the case observed and has permitted two days- time to obtain instruction in this regard.
Further, the court held that farmers cannot be made to execute any documents as security as they are not the borrowers.
It has also been stated that the farmers cannot be imposed with any conditions akin to a borrower.
Accordingly, the court listed the matter for further consideration on November 17, 2023.
The counsel, Advocates Millu Dandapani, Legith T Kottakkal, P.R.Banerji, Binoy Vasudevan, Sreejith Sreenath, S.Ranjit, Gokul Das V.V.H., T.K.Sandeep, Veena Harikumar and Swetha R. appeared for the petitioner.
