Dangerous over-stepping

Madras High Court's order on loan waiver is judicial overreach

On Tuesday, the Madras High Court directed the Tamil Nadu government to waive farm loans taken by all farmers, irrespective of their land holding, and to ensure that no penal action or loan recovery was initiated against them. The court order was in response to a state government order that only marginal and small farmers were eligible for waiver of agricultural loans. An additional 300,000 farmers will benefit from the debt waiver scheme, apart from the 1.7 million existing beneficiaries, for which the state will have to shell out an additional Rs 1,980.33 crore. In its order, the court also said that the central government could not be a bystander and should extend support to Tamil Nadu. The issue of rural distress in Tamil Nadu had received national attention when some farmers from the state conducted a protest demonstration at New Delhi’s Jantar Mantar and claimed that the failure of the north-east, or winter, monsoon had hurt them badly. 

While rural distress caused by such a weather emergency must certainly be addressed, this is an issue for the political executive to manage. For the Madras High Court to direct a state government in this matter appears to be a classic case of judicial overreach. What a state government spends on is a matter for the properly accountable and constitutionally mandated authority to decide, and that is not a high court. The protesters have estimated the cost of full waivers and other related measures as around Rs 40,000 crore. The state of Tamil Nadu has shown robust growth, but it is already burdened with high debt repayments. Nor is its revenue position particularly good; it collects a relatively low proportion of the state gross domestic product in taxes. It is an open question, therefore, whether the Tamil Nadu government is even capable of implementing this order. After all, the government’s existing plan, in which small and marginal farmers were targeted for debt relief, was presumably formulated keeping the fiscal position in mind. The court has said that the division into small, marginal and large farmers is “arbitrary”. But by that standard, any targeted welfare scheme can be derided as arbitrary, and most of the Indian welfare state will have to be universalised. 

Such overreach harms not only the accountability of the executive but also the power of the judicial branch. The legitimacy and speedy implementation of court orders is a crucial component of any constitutionally sound structure of government. However, orders that step beyond a court’s mandate incentivise the executive to ignore them, with unfortunate consequences for the balance of powers. Several other recent court mandates have been problematic in this respect. The directive on liquor sales near highways might cause state governments to denotify highways, for example. The close management of traffic into and out of Delhi by the courts was another such example. Last month, members of Parliament raised the issue on the floor of the Lok Sabha with Law Minister Ravi Shankar Prasad, with some MPs asking why the court was running cricket and the medical council. It would be unfortunate if judicial overreach led to a state of confrontation with the legislature and the executive.