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SC puts stay on High Court’s Order Directing Bajaj Allianz To Compensate Soybean Farmers

2 min read

Shashwati Chowdhury

Published on: June 18, 2022 at 15:43 IST

The Supreme Court on Thursday stayed a Bombay High Court order directing Bajaj Allianz General Insurance Company Limited to compensate over 3.5 lakh farmers in Maharashtra’s Osmanabad district who suffered loss of soyabean crops due to heavy rainfall during the Kharif season of 2020 [M/s Bajaj Allianz General Insurance Co Ltd v Dnyanraj].

The top court stated that if the insurance company fails to deposit Rs 200 crore, the stay order will stand vacated automatically. A vacation Bench of Justices J K Maheshwari and Hima Kohli sought a response in the matter from the Union Agricultural Ministry, the Maharashtra government, and others.

The Court stated that the decision to release the amount deposited by the insurance company will be made on the next date of hearing in August.

Acting on a PIL, the High Court directed Bajaj Allianz, a stakeholder in the Pradhan Mantri Fasal Bima Yojana (PMFBY Scheme), on May 6 to sanction and grant compensation/claim to as many as 3,57,287 agriculturists in the Osmanabad district for post-harvest damage to the soyabean crop.

The High Court further held that if the insurance company did not pay the claim within six weeks, the Maharashtra government must pay it within six weeks.

In its appeal, the company argued that the HC’s judgement was “overbroad” and imposed new obligations and liabilities on it when specific roles, responsibilities, and obligations were clearly delineated and defined in the June 29, 2020 Government Resolution and the underlying Operational Guidelines issued by the Maharashtra government for the implementation of the PMFBY Scheme.

According to the insurance firm, filing a loss intimation within 72 hours of the occurrence of the incident by the farmer/designated agency was essential since the loss/damage for localised disasters and post-harvest losses had to be assessed at the level of the individual insured farm. According to Bajaj, about 65,307 farmers who submitted loss intimation in accordance with the PMFBY Scheme in a proper and timely manner received relief worth Rs 87.87 crore.