FA Nos. 10/2010 to 30/2010 against CC No. 39/2009, CC 40/2009, CC 42/2009   to CC No. 50/2009,  CC 76/2009 to CC 83/2009, CC 131/2009 and 132/2009 on the file of the District Forum, Guntur.

Between :

Andhra Bank , Pittlavani palem

Guntur District, rep. by its Branch Manage..       Appellant/OP

And

All are Ro Pittalavanipalem Village and Mandal,

Guntur District                                                          .. Respondents/complainants

Counsel for the Appellants            :           Mr. K. Sridhar Rao

Counsel for the Respondents       :           Mr. G. L. Nageswara Rao

Coram           ;          

                              Sri R. Lakshminarasimha Rao…      Hon’ble Member

And

                                  Sri T. Ashok Kumar      ..         Hon’ble Member

                                    Friday, the Twenty Seventh Day of January

Two Thousand Twelve

          Oral Order       :   ( As per Sri T. Ashok Kumar , Hon’ble Member )

                                                                        *****

1)                     These appeals are preferred by opposite party  Andhra Bank against the orders of the District  Forum, Guntur  on  separate complaints seeking directions against the opposite party Bank for giving relief under Agricultural debt waiver and debt relief Scheme, 2008 promulgated by the Government of India in respect  of their loans  sanctioned  and to award compensation and mental agony and costs.

2)                       Since  these appeals  are preferred by the very same  opposite party  Andhra Bank   against the orders of the District  Forum  on  the complaints filed by  complainants  pertaining to the common questions of fact and law,  we are of the opinion that all these appeals  can be disposed of by a common order. It is much more so when all the complainants are same village.  For convenience sake, parties as arrayed in the complaints are referred to hereunder :

3)                     The complainants are the residents of Pitlavanipalem Village, Guntur District and farmers by profession.  These farmers do come under the category of “marginal farmers”, “small farmers” and “ other farmers”.  They  have availed Agricultural gold loan from the OP Bank by pledging their gold ornaments. The details of the loan amount  taken by the farmers and the date of its sanction is shown hereunder :

While the matter stood thus,  the Government of India  has declared Agricultural Debit Waiver and Debt Relief Scheme, 2008 ( herein after called Debt Relief Scheme, 2008)  during Budget Speech of 2008-2009. Therefore, the complainants approached OP bank for wavier of their debts basing on the said scheme but OP Bank refused to apply the said Debt Relief Scheme to the loans of the complainants on the ground that the guidelines stipulated under the scheme do not permit the bank to grant the relief and such an attitude of  the OP amount to deficiency in service and it amounts to deficiency in service and the same caused mental agony, pain and suffering to the complainants and hence the complainants  to direct the OP to give relief under the said  Agricultural Debt waiver relief Scheme, 2008 and also to award compensation apart from costs of the complaint.

4.             OP filed written version in each case separately and the sum and the substance of the said written version is as under. The complainants do not come under the purview of guidelines framed by the Government of India in respect of Debt Relief Scheme and therefore question of applying the said scheme to the loans of the complainants does not arise.  All the complainants have executed loan documents at the time of sanctioning of the loans and the said documents reveal as to when each loan fell due.  The said Agricultural Debit Waiver and Debt Relief Scheme, 2008 contained three stipulations

i )         the loan should have dispersed on or before 31.3.2007

ii)         it should be over due as on 31.12.2007 and

Iii )       it remained unpaid until 29.2.2008

In view of the said guidelines the first requirement stands fulfilled but not the second and third stipulations. It is a condition precedent to grant Agricultural gold loan on year period basis and all the complainants have availed the Agricultural gold loan on year period basis and therefore their loans have not become over due by 31.12.2007 and remaining unpaid till 29.2.2008.  The loan documents executed by the complainants reveal that the complainants have undertaken to repay the loan amount with 9% interest within one year from the date of sanction or on demand from the bank.  Since the loans availed by the complainants were prior to 31.3.2007 they have not become over due as on 31.12.2007 and remains unpaid until 29.2.008 and thus the said debt relief scheme is not applicable to the complainants and that there is no deficiency in service on the part of the OP bank and thus prayed to dismiss all the complaints.

5.            Both parties have filed evidence affidavits and marked documents in Ex. A and B series described in the Index at the foot of each and every order pertaining to the said complaints.

6.            Having heard both sides and considering the evidence affidavits of the parties to  the proceedings and the documents marked by them in the above complaints, the District Forum allowed all the  above   complaints with costs of Rs.500/- in each case directing the OP to apply to Debit Relief Scheme 2008 to the loans availed by the complainants vide their respective Account Numbers and grant waiver subject to category wise viz., loans up to Rs.50,000/- and loans above Rs.50,000/- . six weeks time was given for compliance. 

7.            Aggrieved by the said orders, these appeals contending that the impugned order are contrary to law, facts and material on record and the District Forum erred in dismissing the respective  IAs  to implead the Secretary, Ministry of Finance as necessary party and that the District Forum failed to appreciate the only first condition was fulfilled but not other two conditions and that the respondents/complainants are not entitled for waiver of the loan under the Scheme but erroneously passed the impugned orders holding that the complainants are entitled for benefit under the scheme which is not sustainable and thus prayed to allow the appeals and set aside the orders,.

8.            Heard both side counsel with respect to respective contentions in detail. Counsel for respondents submitted written arguments.

9.            Now the point for consideration is, whether the orders of the District Forum are sustainable ?

It is in not dispute that the complainants have borrowed the loans on the respective dates  described supra, so also, that the Central Government issued Debt Relief Scheme. 2008 mentioning the guidelines for application  of the scheme to the debtors.   Both side invoked the guide line no. 4(1)(a) of the said scheme and therefore for convenience sake the same is describe below.

 4.1   The amount eligible for debt waiver or debt relief, as                                               the case may be (hereinafter referred to as the                                                eligible amount) shall comprise of:

a)      In the case of a short-term production loan, the amount of such loan (together with applicable interest);

i) Disbursed upto March 31, 2007 and overdue as on     

December 31, 2007 and remaining unpaid until  February 29, 2008.

                             ii) restructured and rescheduled by Banks in 2004                                                            and in 2006 through the special packages announced                                            by the Central Government, whether overdue                                                   or not; and

iii) restructured and rescheduled in the normal course upto March 31, 2007 as per applicable RBI guidelines on account of natural calamities, whether overdue or not.

There is no dispute that the complainants come under the description of small farmer or marginal farmers.  Similarly there is no dispute that all the loans of the complainants were disbursed prior to 31.3.2007.  According to the Opposite party Bank the said  loans have not come over due as on 31.12.2007 and remaining unpaid till 29.2.2008 and therefore  conditions 2 and 3 enumerated under 4.1 (a)(i) of the said scheme are not fulfilled and therefore the Bank rightly refused to apply the scheme to the complainants. The said scheme is a welfare measure in favour of the poor peasants and it was announced in order to give relief to the farmers those who availed the said loans prior to 31.3.2007 even by their reconstructing and rescheduling the scheme in the year 2004-06 and it is not desirable to defeat the scheme by misinterpreting the provisions of the scheme.   In the circumstances of the case, it is necessary to look into the significance attached to those cut off dates as fixed in the guidelines with regard to the disbursal, over due and remains unpaid. The gap between the period of disbursal and over due is nine months only.  According to the Ops one year period is to be computed from the date of sanction of the loan as evidenced by documents executed to evaluate over due date.  It is common experience that agriculturists avail agricultural loan basing on upon the crop period only but not for years. Copy of “Best Practice Code on Agricultural Financing  for use of authorized person of Syndicate Bank” submitted by the complainants’ counsel with written arguments reveals that repayment shall be fixed based on the crops grown and possible time of harvest with some leverage for marketing and realization of proceeds.  The  circumstances of the case on record reveal that the complainants have availed Agricultural crop loan from OP bank for Rabi season which is a short term loan for a maximum period of 4 to 5 months only.  Since it was a short term crop loan the complainant ought to have paid the said loan immediately after receipt of the crop and admittedly they did not pay such a loan and therefore it has to be held that the said loans were overdue by 31.12.2007.  The OP Bank  did not establish with any convincing evidence that there is a  precedent to grant agricultural gold loan on one year period basis to say that the loans in question did not become over due by the said cut off date.  When such loans were extended on promissory notes it has to be held that the complainants agreed to pay the loan on demand there is acceptable force in the contention of the complainants to come to a conclusion that by the date of announcement of the scheme the said loans remained unpaid  and once they remained unpaid by 29.2.2008  they are deemed to be over due by 31.12.2007 and thus all the conditions of the scheme were fulfilled in the present cases. According to OP the complainants executed promissory notes in its favour ensuring repayment of loan with agreed interest when it is so the amount is repayable by the Debtors on demand made by the OP. If there is any time stipulation it is not a promissory notes and it amounts to bond depending on other requirements. Admittedly there is no such time stipulation in the promissory note.  In such circumstances, the contention of the OP that “ the said promissory notes will be obtained in case of default to file suit and to avoid unnecessary burden of stamp duty in cases of agricultural loans could not be appreciated in its favour”.  In such circumstances, the contention of the OP in the said context could not be appreciated in its favour.  Merely because the complainant did not issue any notice to the Op prior to the filing of the complaint it is of no consequence in favour of the OP.  The complainant did not allege any deficiency in service on the part of the Secretary, Ministry of Finance Department of finance services, New Delhi and in such circumstances the said the Secretary is not at all a necessary party and therefore the said ground also is not useful for the appellant in this case. The OP did not convince this Commission that the said Debt Relief Scheme is not applicable to the Agricultural Gold Loan.  The orders under appeal disclose that  Guntur Central     Cooperative Bank Limited issued a circular stating that the said scheme is applicable to loans  disbursed prior to 31.3.2007 and remains unpaid still  29.2.2008 and the said  circular also supports the case of the complainants. Why it cannot be considered in favour of the complainants has not been clarified by the OP so also as to how it was irrelevant.  The said guidelines do not specifically stipulate the over due period should be construed as one year preceding to date of sanction of the loan and we did not see irregularity or abnormality in the finding of the District Forum in the said context.   For the reasons given by the District Forum and this Commission, the appeals are devoid of merit and liable to be dismissed.

10.         In the  result, the FA Nos.10/2010, 11/2010, 12/2010, 13/2010, 14/2010, 15/2010, 16/2010, 17/2010, 18/2010, 19/2010, 20/2010, 21/2010, 22/2010, 23/2010, 24/2010, , 25/2010, 26/2010, 27/010, 28/2010, 29/2010 and 30/2010 are dismissed confirming the orders of the District Forum. There is  no order as to the costs in the appeals.

                                                                                                MEMBER

                                                                                                MEMBER

                                                                                                Dt: 27.01.2012.