Top court stays Bombay HC order asking insurance underwriter to compensate farmers for crop loss under PM Bima Yojana

The Supreme Court has stayed a Bombay tribunal order which had asked an underwriter to compensate over 3.5 lakh farmers for crop loss under the Pradhan Mantri Fasal Bima Yojana (PMFBY).

The Supreme Court has stayed a Bombay judicature order which had asked Bajaj Allianz General insurance firm Ltd. to compensate over 3.5 lakh farmers under the Pradhan Mantri Fasal Bima Yojana (PMFBY) for loss of soya bean crop thanks to heavy rainfall in 2020.

A Supreme Court vacation bench comprising justices J K Maheshwari and Hima Kohli, however, asked the insurance underwriter to deposit Rs 200 crore with its registry within a period of six weeks from June 16.

In a major relief to soya bean farmers of Osmanabad district of Maharashtra who had suffered crop loss thanks to heavy rainfall within the Kharif season of 2020, the Bombay supreme court circuit bench in Aurangabad recently directed the underwriter to compensate them.

The insurance underwriter was represented within the Supreme Court by senior advocate Vivek Tankha and other lawyers including Tanvi Dubey.

While issuing notice on the appeal of the insurance underwriter, the SC bench, on June 16, said, “In the meantime, there'll be a stay of operation of the impugned judgment subject to the petitioner depositing an amount of Rs 200 crore with the Registry of this Court within a period of six weeks from today, as requested. the quantity deposited shall be invested in a veryn interest bearing fixed deposit in a nationalised bank until further orders."

In the event the number isn't deposited within six weeks, the order of stay shall stand automatically vacated without further regard to the court, it ordered.

The bench directed the petitioner farmers and also the regime to file their replies within six weeks.

The state supreme court, while directing the insurance underwriter to compensate the farmers, had said that if the corporate didn't pay then the authorities should compensate the farmers for the crop loss.

"If the number isn't paid by the underwriter...the authorities is directed to pay such claim for compensation for post-harvest loss caused to the soybean crop in Kharif season 2020 to remaining 3,57,287 agriculturists of Osmanabad district within a period of six weeks thereafter,” the supreme court had said.

The supreme court order had come on a batch of petitions of the farmers challenging the refusal of their sum of money for his or her post-harvesting losses.

The farmers had submitted that that they had paid premiums for amount of money of their crops.

The supreme court was also informed that the nondepository financial institution received over Rs 500 crore as premium under the Pradhan Mantri Fasal Bima Yojana from farmers in Osmanabad.