The Aurangabad bench of the Bombay High Court last week set aside notices issued by the state government seeking the recovery of Rs 374.61 crore from Bajaj Allianz General Insurance Co. Ltd to pay famers in Osmanabad (now renamed Dharashiv) for damage to soybean crops due to “unseasonal rains” categorised as “localised calamity” under the Pradhan Mantri Fasal Bima Yojana (PMFBY).

The notices demanded the Insurance firm pay arrears of land revenue for the kharif season of 2021 as per revamped operational guidelines (ROG) issued under the PMFBY.

Allowing the insurance company’s plea, the HC negated the state’s claim that the petitioner had paid only 50% of the amount due and payable and therefore notices were issued to it for further recovery.

The firm had claimed that it had abided by the Government Resolution (GR) of June, 2020 pertaining to crop insurance against unpreventable natural risks or calamities from the pre-sowing to post-harvesting stage.

A division bench of Justices Manish M Pitale and Y G Khobragade on September 12 passed a judgement on a plea by the insurance firm related to a Memorandum of Understanding (MoU) executed between the petitioner and the state government. However, the PIL filed by two farmers justified the state’s demand from the firm and sought direction to the insurance company to pay the balance amount with interest to the farmers.

Representing the insurance company, senior advocate Sharan Jagtiani claimed it had paid Rs 374.61 crore to the concerned farmers for localised calamity that occurred in September 2021 and had satisfied the dues payable as per the ROG.

The company claimed that the localised calamity of unseasonal rains took place between September 23 and October 10, 2021 and actual soybean harvesting in the said district began on September 17 that year and continued till November 11, 2021. The firm claimed that while the local calamity began on September 23, four days after the commencement of harvesting season, there was no huge loss to the farmers and therefore it was required to pay only 50 percent of the total claims as per the ROG.

The company challenged the notices issued by the state government under the provisions of Maharashtra Land Revenue (MLR) Code, 1966, seeking recovery of the amount from the company and directions issued to it for freezing bank accounts of the firm.

However, the state government said that it received several complaints from the farmers that the insurance company did not satisfy the entire insurance claims and the firm was bound to pay the rest of the amount.

The court noted that the crop calendar notified by the state government showed that the period of harvesting between October 15, 2021 and November 15 the same year was a “general or normal harvesting period”, which was not defined under the ROG. The court said it has to be the date when the “actual harvesting” started, which in the present case commenced on September 17, 2021 in the said district.

The HC also noted that data of crop cutting experiments (CCEs) as per the Chief Statistician of the Commissionerate of Agriculture of the state government showed figures of average/actual yield of soybean crop for the then Osmanabad district for the kharif season 2021 in each of the 42 circles “was much higher than the threshold yield”, therefore the state’s claim was “unsustainable”.

“Therefore, this Court is unable to agree with the state that the company was being rapacious while denying the claims raised by the state on behalf of the farmers,” the HC noted.

The bench observed that as all payments under the MOU were directly made into accounts of individual farmers, the amount sought to be recovered by state authorities was “not legally claimable” by them.

Source - Indian Express