Short-term loan waiver schemes do not extend to medium-term agricultural loans regardless of outstanding interest.

The petitioner, a 70-year-old farmer and Gram Patel of Village Nandal, holding approximately 4.58 hectares of land, sought the waiver of an outstanding loan under the Chhattisgarh Short-term Farmer Loan Waiver Scheme, 2018.

The petitioner had taken a medium-term loan (M.T.L) of ₹3.20 lakhs in May 2013 for agricultural equipment (bore pump, sprinkler, fencing).

While the petitioner claimed he was entitled to a waiver and stopped payments in anticipation, Respondent No. 4 issued a demand notice on 01/10/2019 for ₹4,23,000/- (inclusive of interest).

Respondent No. 3 (Bank) contended that the 2018 Scheme applied only to "short-term" loans outstanding as of 30.11.2018, whereas the petitioner's loan was a "medium-term" loan that had lapsed, making him ineligible.

The petitioner also sought the sanction of a ₹1.00 lakh KCC loan allegedly entered in his Rin-Pustika but never disbursed.

1. Whether the loan amount of ₹2,25,515/- (principal) plus interest outstanding against the petitioner is liable to be waived under the Short-term Farmer Loan Waiver Scheme, 2018.

2. Whether the respondent authorities should be directed to sanction and disburse the KCC loan of ₹1.00 lakh as per the entries in the petitioner’s Bhu-Adhikar and Rin-pustika.

The Court primarily considered the "Short-term Farmer Loan Waiver Scheme, 2018" notified by the State of Chhattisgarh, which directed cooperative banks to waive off short-term agricultural loans for various categories of farmers.

The legal principle involves the administrative interpretation of "short-term" vs. "medium-term" loans and the eligibility criteria (specifically the cutoff date of 30.11.2018) established by the executive policy for debt relief.

The Court examined the competing claims regarding the nature of the loan and the applicability of the 2018 Scheme.

The petitioner argued that as a small farmer, he was entitled to the benefit, while the Bank asserted that the loan was for equipment (bore pump, etc.), qualifying it as a "medium-term loan" which fell outside the "short-term loan" mandate of the 2018 Scheme.

Rather than adjudicating the technical classification of the debt or the factual dispute regarding the KCC loan entry through the writ jurisdiction, the Court determined that the matter required a factual verification by the concerned financial institution.

The Court emphasized that the respondent authorities must evaluate the petitioner's documents against the specific parameters of the 2018 Scheme.

The Court ordered the Bank to consider and decide whether the loan could be waived in accordance with the law, specifically bearing in mind the provisions and intent of the 2018 Scheme.