SC Stays Madras HC Order to Waive All Farm Loans in Tamil Nadu

The HC had directed the government to extend farm loan waiver to all farmers, and not limit it to only small farmers

In what will come as a blow to Tamil Nadu’s farmers, the Supreme Court on Monday stayed the Madras High Court’s order directing the state government to waive the farm loans of all farmers.

This comes after the Tamil Nadu government challenged the high court’s order in the apex court.

In April, a Division Bench comprising of Justices N Nagamuthu and MV Muralidharan had directed the state government to extend farm loan waiver to all farmers, and not limit it to only small farmers – those owning less than five acres of land.

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While the AIADMK government has waived loans from cooperative banks taken by small and marginal farmers, to the tune of Rs 5,482 crore, the high court’s order meant an additional burden of Rs 1,980 crore for the state, reported The Hindu.

The high court had termed the Tamil Nadu government’s June 2016 order discriminatory, and not an intelligible criterion, and ordered the state to cover all farmers who had availed of loans from cooperative banks till 31 March 2016, reported Times of India.

Noting that the financial situation of the Tamil Nadu government is “grim”, the bench went on to observe that the Centre should step in to share the burden.

Defending the Tamil Nadu government’s decision to move the Supreme Court, the Cooperation Minister Sellur K Raja had in June stated in the TN Assembly, “We moved the appeal only to get a clarification on whether the courts have powers to decide on these matters, which are only approved by the Assembly. It should not set a precedent in matters like these.”