IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE TWELTH DAY OF NOVEMBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE V.V.S.RAO WRIT PETITION NO : 17018 of 2001 Between: Gundumogula Venkat Rao, S/o.Suranna R/o.Taduvai Village, Jangareddigudem Mandal, W.G.District. ..... PETITIONER AND 1 The General Insurance Corporation of India, State Level Insurance cell at United India Insurance Bldg., 3-5-817-818 (8th floor), Bashirbagh, Hyderabad. 2 Taduvai Primary Agriculture Co.Op Credit Society Limited No..A:19. Rep. by its Secretary, Sri P.Subramanyam, Taduvai, Jangareddigudem Mandal, West Godavari District-534 447. 3 The Director, Bureau of Economics and Statistics, Government of Andhra Pradesh, Khairtabad, Hyderabad-4. 4 The Commissioner of Relief/Ex.Officio, Secretary, Government of Andhra Pradesh, Secretariat, Hyderabad. 5 The District Collector, West Godavari at Eluru. .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to to issue writ or order or direction more in the nature of Writ of Mandamus declaring more in the nature of Writ of Mandamus declaring the action of the respondents in general and the Respondent No.1 in particular in not paying the claims of the petitioner and other shown in the Annexure relating to the crop lost of the Kharif season of 1996, as illegal, arbitrary, unjust and unconstitutional, besides being violative of principles of natural justice; while issuing a consequential direction to the respondents to pay the claims of the petitioner and others shown in the Annexure relating to the insured crop of the Kharif 1996 season (1406.F) of Taduvai Primary Agriculture Cooperative Credit Society Limited members of Jangareddigudem Mandal of W.G.District for a sum of Rs.6,19,000/- with interest at 18% p.a. from December, 1996 till the date of payment, in the interest of justice and pass. Counsel for the Petitioner:MR.D.GOVERDHANACHARY Counsel for the Respondent No.: GP FOR REVENUE The Court made the following Order: THE HON'BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.17018 of 2001 ORDER: The petitioner ﬁled instant writ petition in representative capacity seeking a direction to the respondents to honour the claims of the petitioner and sixty-six persons belonging to Taduvai, Gollagudem, Challavarigudem, A. Polavaram and other Villages in West Godavari District towards crop insurance for Kharif season of 1996 (1406.F) with interest at 18% p.a., from December, 1996. The petitioner and others obtained crop loans from Taduvai Primary Agriculture Cooperative Credit Society Limited (PAC) for Kharif reason 1996. While granting loans second respondent deducted requisite premium towards crop insurance under National Agricultural Insurance Scheme (Scheme). Be that as it is there was severe cyclone in November, 1996, as a result of which forty-six Mandals in West Godavari District aﬀected. Kharif crop 1406 fasli was damaged in cyclone. The District Collector also issued notiﬁcation No.84 dated 18.11.1996 to the eﬀect that there was crop damage in forty-six Mandals. In spite of the same, though the premium was collected by ﬁrst respondent, insurance amount was not paid by it, and it raised objections. Hence instant writ petition. The validity of the Scheme was considered by a Division Bench of this Court in Andhra Pradesh Rythu Sangham v Union of India[1]. After referring to various orders and judgments of learned single Judges as well as a judgment of a Division Bench in Writ Appeal No.346 of 1992 dated 5.2.1996, the Division Bench observed and laid down as under. The validity of the ‘Scheme’ was challenged before this Court, as well as before other High Courts. This Court in W.P. No.11882 of 1987 and batch, dated 23.8.1988 after considering the salient features of the Scheme and also the various aspects, its applicability to the farmers, delivered a detailed judgment upholding the validity of the Scheme. Following the aforementioned judgment, another learned Judge of this Court disposed of another Writ Petition, via., W.P. No.351 of 1987 dated 23.4.1991 on similar lines. Even a Division Bench of this Court in Writ Appeal No.346 of 1992 dated 5.2.1997 has conﬁrmed the judgment of the learned Single Judge of this Court upholding the Crop Insurance Scheme. This Court in W.P. No.11882 of 1987 and batch dated 23.8.1988 has held as follows:- “There is no denial of the fact that scheme is devised for the welfare of agriculturists, but then the scheme does not operate in favour of each individual agriculturist. In very nature of things, it is impossible to devise a scheme whereunder the loss suﬀered by any single agriculturist could be quantiﬁed and reimbursed. I have gone through the provisions relating to the scheme carefully. The concept has been succinctly stated in Para 9 of the counter ﬁled by the General Insurance Corporation of India and I am in full agreement with the explanation provided. A broad principle of equity has been adopted in formulating the scheme. The agriculturists are dealt with in a group basis to provide compensation on the basis of average production in a deﬁned area that is why it has become necessary to formulate an average yield in a deﬁned area, which are scientiﬁcally designed to reluct the average of the area with a fair degree of accuracy. It is possible that the compensation paid on the above basis may fall short of the loss suﬀered by individual farmer. But, then by and large, when the average worked out on the basis provided in the scheme, it provides a reasonable compensation to the farmers as a group in the notiﬁed area. The averages are worked out by the method adopted by the Directorate of Economic and Statistics and unless it is established that the average worked out on the basis of information furnished is correct. It may be true that if a smaller deﬁned area is notiﬁed taking into consideration the peculiar characteristics of each area, it may provide more authenticated results. While the State Government has to undertake the exercise of notifying smaller deﬁned areas, the results eventually arrived at may accord in a larger measure with the loss suﬀered by an agriculturist. But then on that ground it is not possible to question the validity of the scheme or to come to a conclusion that the scheme is arbitrary.” The validity of the Scheme was also upheld by the High Court of Kerala by its order dated 8.9.1989 passed in O.P. No.11380 of 1985 and batch. We are of the opinion that the Scheme beneﬁts the farmer indemnifying him against the crop loss. The amount of loan will be recovered from the Insurance amount thereby a double purpose is served. The poor cultivator is indemniﬁed against loss and the ﬁnancial institutions, which are co-operative Banks, are indemnified against loss by the General Insurance Corporation. This is a social security measure meant for the beneﬁt of rural population and beneﬁts only those who take loans from the ﬁnancial institutions. In other words, it is limited to the class of people who are getting subsidized loans from such institutions who themselves have got to be saved against ruin by general calamities aﬀecting the area in question. Such a scheme cannot be said to be in any manner, unreasonable or arbitrary. In view of the opinion of the Division Bench whenever PAC sanctions and disburses agricultural loans to farmers, certain percentage of the loan amount is deducted towards crop insurance. Therefore, ﬁrst respondent cannot escape their liability to pay the insurance amount as per the Scheme. It appears that ﬁrst respondent raised a dispute with regard to payment of insurance amount. Though notice is served, no counter aﬃdavit is ﬁled. In this background this Court is of the considered opinion that the claim made by the petitioner and sixty-six other villagers should be considered by ﬁrst respondent in accordance with the Scheme. Accordingly the writ petition is disposed of directing ﬁrst respondent to consider the claims made by the petitioner and sixty-six other villagers and inform all of them as to the action taken. This exercise may be completed within a period of two weeks from the date of receipt of a copy of this order. No costs. _____________ (V.V.S.RAO, J) 12th November, 2008 GHN To 1 The General Insurance Corporation of India, State Level Insurance cell at United India Insurance Bldg., 3-5-817-818 (8th floor), Bashirbagh, Hyderabad. 2 Taduvai Primary Agriculture Co.Op Credit Society Limited No..A:19. Rep. by its Secretary, Sri P.Subramanyam, Taduvai, Jangareddigudem Mandal, West Godavari District-534 447. 3 The Director, Bureau of Economics and Statistics, Government of Andhra Pradesh, Khairtabad, Hyderabad-4. 4 The Commissioner of Relief/Ex.Officio, Secretary, Government of Andhra Pradesh, Secretariat, Hyderabad. 5 The District Collector, West Godavari at Eluru. 6 2CCs to GP for Revenue 7 2CD copies Form-NIC-OGS/WP{TML} [1] 2002 (2) ALT 696 (D.B.)