Kerala High Court Orders Swift Settlement of Unpaid Paddy Procurement Dues to Farmers

The Kerala High Court has issued a directive mandating that Supplyco settle outstanding paddy procurement payments owed to farmers within a month. Supplyco has the option to request farmers to visit the bank and sign a receipt, following which the arrears will be credited to their accounts. Alternatively, if farmers are unwilling to do so, Supplyco must ensure payment within the stipulated one-month period.

The case will be revisited on October 31, and Supplyco is required to submit a progress report outlining the actions taken by that time. This order stems from a petition filed by Shivanandan and others from Palakkad, seeking compensation for the paddy they supplied.

Supplyco has stated that payments up to Rs 50,000 will be disbursed immediately. Amounts exceeding this threshold will see 28 percent paid directly, with the remaining balance transferred through banks.

The paddy was procured during April and May. The petitioners argued that Supplyco insisted they approach the bank for payment and sign loan applications and security documents. In response, Supplyco asserted that this approach followed an agreement involving the bank, the government, and Supplyco.

Under the paddy procurement scheme, full payment to farmers should occur within 60 days of collection. The court observed that failure to do so was unjust, thereby validating the concerns raised by the petitioners. However, the court also emphasized that since the agreement involved the bank and the government, farmers should not be burdened with repaying the amounts disbursed by the banks upon receipt signing.

The court firmly maintained that any effort to shift responsibility onto the farmers is unacceptable.