The scheme cannot be considered constitutionally suspect simply because it was an election promise: SC
The Supreme Court on Tuesday upheld a plan by the then-ruling AIADMK government in Tamil Nadu to waive outstanding agricultural loans, medium-term loans (agriculture) and long-term loans (agricultural sector) to small farmers and marginal farmers. The Supreme Court said that it is established law that a scheme cannot be considered constitutionally suspect simply because it was based on an election promise.
A chamber of justices DY Chandrachud and AS Bopanna overturned an April 4, 2017 order of the Madurai chamber of the Madras High Court, claiming that it erred in considering that because the project conformed to a promise election, it is constitutionally suspect. “The regime in question was introduced in fulfillment of an electoral promise made by the party then in power in Tamil Nadu. The High Court appears to have been of the opinion that because the project conformed to an election promise, it is constitutionally suspect. This opinion was based on the assumption that no study should have been conducted before the election promise was made. It is established law that a project cannot be considered constitutionally suspect simply because it was based on an electoral promise ”, declared the magistracy. He said a project can only be considered suspect within the framework of the Constitution, regardless of the intention with which the project was introduced. “The plan proposed by the state of Tamil Nadu stands up to constitutional challenge. The High Court erred in finding otherwise. During the course of the proceedings, the state provided broader coverage, based on its assessment of the situation, ”he said. The government of Tamil Nadu published a program in May 2016, granting a waiver of current harvest loans, medium-term loans (agriculture) and long-term loans (agricultural sector) to small and marginal farmers. The scheme guidelines provided for classifying farmers as small and marginal, the extent of land ownership as mentioned in the land register and the loan register at the time of sanctioning the agricultural loan should be taken into consideration.
“As for the definition of ‘small farmer’ and ‘marginal farmer’, it provides that ‘small farmer’ refers to a farmer who owns land from 2.5 acres to 5 acres and ‘marginal farmer’ refers to a farmer who owns land. up to 2.5 acres. Subsequently, a circular was issued by the Registrar of Cooperative Societies on July 1, 2016, providing additional guidelines for the implementation of the program, ”the magistrate noted.
The state government has made a preliminary assertion that the court cannot review the scheme since it is a state tax policy decision. The judiciary said that the two-part test developed by the court to determine the validity of the law under Article 14 of the Constitution refers to the objective of the law because the “politics” behind the law. law is never completely isolated from judicial attention. . “However, it is established law that the Court cannot interfere with the soundness and wisdom of a policy. A policy is subject to judicial review on limited grounds of respect for fundamental rights and other provisions of the Constitution, ”he said, adding that it was also agreed that the courts would show a degree higher deference to matters concerning economic policy, compared to other matters of civil and political rights.
The bench said economic policies broadly include policies on taxation, spending and allocation, and that the state and its agencies often strive to make economically feasible decisions. “The implementation of any state policy entails expenditure. Just because politics involves the expenditure of funds, it cannot be called economic policy. The main characteristic of the policy and the target area must be determined to identify the nature of the policy, ”he said.
The bench said that the contested loan exemption scheme is, in essence, a social policy in accordance with the guiding principles of state policy, introduced with the aim of eliminating inequalities of status, income and facilities. . “The loan exemption program also conforms to the guiding principles of state policy. In view of the observations in… the regime cannot be considered as a violation of article 14 because it does not impose a burden but offers a benefit, ”he said. The Supreme Court said the equality code in article 14 of the constitution prescribes substantive and non-formal equality, and the classification is reasonable when the twin tests based on intelligible difference are met.
“Therefore, the reasons which seem to have guided the State of Tamil Nadu for the formulation of this program are twofold: (i) Small and marginal farmers suffered greater damage due to climatic conditions and capital than they own ; and (ii) the state seeks to provide maximum benefits with minimum funds, ”he said.
The bench said that, therefore, courts must show greater deference to cases where the rational connection test is applied.
“Since the classification in the contested scheme is based neither on the grounds of Article 15 nor on the ‘innate and essential character’ of an individual, it cannot be rescinded on the alleged grounds of under- inclusiveness and over-inclusiveness, ”says bench.
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