The Kerala Farmers' Debt Relief Commission Act, 2006

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TilE KERALA FARMERS' DEBT RELIEF COMMISSION ACT, 1006 
(ACT 1 OF 2007) 
~CONTENTS 
Preamble 
Sections 
1 Short tttle• and commencement 
2 Defmittons 
3 Constitution of the Comm1sston 
4 Term of the Commtss1on and condittons of scrvacc of the members 
5 Powers and Functtons of the Comm1ss1on 
6 To declare as dtstress effected area or dtstress affected crop 
7 Apphcatton for debt rehef 
8 Sittmgs of the Commissaon 
9 Spectal provtsions m respect of settlement of ccrtam loans taken by 
farmer 
10 Re-scheduhng of loans taken by a fanner from financtal mstttut10ns 
11 Bar of Suus, apphcattons and other proceedmgs 
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12 Payment of debt m mstalments 
13 The debt shall be deemed as fully repa1d 
14 Annual Report to be laid before the Legtslatave Assembly 
• 15 Accounts and Audtt 
16 Ovemding effect of Act 
17 Bar of Junsdtctlon of C1vtl Court 
18 Members of the Comm1ssmn shall be public servants 
19 Protectton of action taken m good faith 
~ Power to remove dtfficulttes 
21 Power to make rules 
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[Translat10n m Enghsh of "2006·6)QJ acfhmi} cOJ<8rdjc£b dhSO(Jl)JOcru cfhaafln~o& . 
~c&;g" published under the authonty of the Governor] 
ACT 1 OF 2007 * 
TilE KERAlA FARMERS' DEBT RELIEF COMMISSION ACf, 2006 
An Act_ to provtde relzef to those farmers who are tn drstress due to 
mdebtedness, by constllutmg a Commrsswn wllh power to pass awards 
after adjudrcatron and to recommend appropnate ml'a.Htres for the 
redressal of the grzevances of ~uch farmers through conclitalton and 
negottatwn and for matters connected the1 ewzth or inctdental thereto 
Preamble -WHEREAS the benefits conferred by the Kerala Agncultural 
Debtors' (femporary Rehef) Act, 2001 (19 of 2001) arc avrulable only m respect of 
debts mcurred by fanners before the 29th December, 2001, on whtch date the satd 
Act came mto force, 
AND WHEREAS, even after the satd date the fanner indebtedness m the State 
contmued to be on the tncrease due to vanous factors; 
AND. WHEREAS, certatn dtstncts tn the State are affltcted by severe dtstrcss .. 
due to the agranan cn~ts, and 1t rumed many farmers financially and in some 
cases led to sutctde, 
AND WHE:REAS, several sutts and other proceedmgs have been ftled m 
courts, tnbunals and other authontles for the recovery of debtc; accrued from 
fanners, r 
AND WHEREAS, it ts expedtent to provtde rchef to the farmers who are m 
dastress due to indebtedness, by constllutmg a Commtss1on wath power to pass 
awards after adJudacatlOn and to recommend appropriate measures for the 
redressal of ,the gnevances of such fanners thrbugh conctliahon and negot1atton 
and for matters connected therewtth or mc1dental thereto; 
8[ at enacted m the Ftfty-seventh year of the Republtc of Ind1a as follows·-
1. Short tzt/e and commencement--( 1) Thts Act may be cal1ed the Kcrala 
Fanners' Debt Rehef Conuntsston Act, 2006. 
(2) It shall come mto force at once. 
• Received the assent of Governor on the 18th January, 2007 nnd publi<;llcd in the 
Kerala Gazette Extraordan ary No I 06 dated 18th January, 2007 
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2. Defimtzons -In thts Act, unless the context otherwise requtres,- , V: 
(t) "agnculture" mcludes horuculture, fannmg and growmg of medtcmal 
plants, crops and mtercrops, fruits, vegetables, flowers, grass, fodder grass and 
trees or any kmd of culu vat10n of s01l, conductmg nursery, breedmg and keepmg 
of hvestock mcludmg fish, mussel, bees, silkwonn, poultry, duck, cattle or ptg and 
the use of land for agnculture alhed acttvlttes or any. other agncultural purposes; 
(n) "agncultural labourer" means a person who; m constderattOn of the 
wages payable to htm by a landowner, works on the agncultural land of such 
landownttr or does any other agricultural operation, 
(w) "appropnate level of debt" means the amount determined by the 
Commtsston as repayable by the debtor under clause (b) of sub-section (1) of 
sectJOn ~,, 
(tv) "Commts!>JOJJ." means the Kerala State Farmers' Debt Relief 
Commtsston constituted under sectton 3, 
(v) "Co-operattve Soctety" means a soctcty regtstered or deemed to have 
been regtstered under the Kerala Co-op~rattve Socteties Act, 1969 (21 of 1969), 
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(vt) "credttor" means any person engaged m money lendmg, ·whether 
under a hcence or not and mcludes hts heirs, legal representatives, asstgnees, co­
operative soc1ety and any other person as may be nottficd by the Government; 
(w) "debt" means any habthty, whether secured or unsecured due from a Z. 
farmer on or before the commencement of thts Act whether payable under a -
contract, or under a decree or order of any Court or Tnbunal, or otherwise, and 
mcludes, 
(a) any sum payable to,--
(t) an mstitu!tonal credttor, 
{n) a co-operattve soctety, 
(b) any sum borrowed by a farmer from the credttor; 
But does not mclude any loan amount taken by the farmer for commercial 
..:....-purposes or luxury other than agncultural alhcd commerctal purposes, to augment ~ 
h1s mcome and the amount payable to Central or State Governments or other 
State Governments or Govenunents of Umon Temtones and the amount due to 
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Local Self Government Instttuttons, Statutory Bodies, Central or State Public Sector 
Undertakmgs and other Instttut10ns as may be specified by the Government by 
nohficahon; 
(vtu) "dtstnct" means a revenue d1stnct, 
(1x) "dtstress affected area" means revenue dtstnct or dsstnct~ or part 
thereof m the State, declared by the Government as per Sccllon 6, for the purpose 
of th1s Act, on the recommendattons of the Commissjon; 
' . {x) "distress affected crop" means any crop or crops of the State 
declared by the Government as per section 6 on the recommendatton of the 
Comm1ss1on, for the purpose of this Act; 
(x1) "d1stress affected farmer'' means a fanner declared as such by the 
Commtss•on and mcludes agncultural labourer for the purpose of thts Act; 
(xn) "fatr rate of interest" means the rate of mtcrcst detcmund by the 
CommiSSion under clause (b) of sub·sectJOn ( 1) of sectaon 5 of tlus Act; 
(xnt) "fanner" means a person who holds whether as owner, hccnsee, 
mortgagee m possess1on, oral lease, Govcnunent land lease "Kuthakapattam" or 
partly m one capactty and partly m another w1th possesston of an extent of land 
not exceedmg four hectares and whose pnnctpal means of hvchhood is agnculture 
and whose annual mcome does not exceed rupees two lakhs and mcludes an 
agnculturallabourer, Kudumbasree and self help group unite; domg culttvauon by 
talang over agncultural la11d on lease agreement condition, 
(xtv) "financtal mstltutlon'' means any financtal institution constituted by 
or under any Central Act, State Act for the ttme bemg m force and owned and 
controlled by the Government, 
(xv) "Government'' means the Government of Kcrala; 
(xvi) "tnstttuttonal cred1tor" means the State Bank of India or any 
Subs1d1ary Bank w1thm the meaning of clause (k) of sectton 2 of the State Bank 
of Iruha (Subsidiary Bank) Act, 1959 or any Scheduled Bank; 
(xvu) "mterest" means any amount payable m excess of the princtpal 
-<_... amount borrowed or ptcumary obhgatton mcurrcd, by whatsoever name such 
amount may be called, whether the same IS expressly mentioned or not m the 
document or contract, tf any, 
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(xvm) "member" means a member of the Comm1sston and mcludes the 
Chaannan, 
(xtx) "penal mterest" means any amount payable m excess of mtercst on 
a debt; 
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(xx) "prescnbed" means prescnbed by rules under thts Act, 
(:un) "pnncipal amount" means the amount ongmally advanced together 
w1th the amount, 1f any, as has been subsequently advanced, notwtthstandmg 
any sttptWition to treat any mterest as capital and notwithstandmg that the debt 
has been renewed, whether by the same fanner or by hts herrs, asstgnees, or legal 
.representatives or by any other person actmg on his behalf or on his mterest, 
and whether m favour of the same credttor or hts he1rs, asstgnees or legal . 
representatlves or of any other person actmg on hts behalf or on hts mterest, 
(xxu) "Secretary" means the Secretary to the Commission appomted 
under sub-sectiOn (4) of Sect1on 3, 
(xxm) "State" means the State of Kerala 
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3. Constztuuon of the CommtSswn --(1) The Government shall, as soon as 
may be after the commencement of th1s Act, by nottficat10n m the Gazette, 
constitute a Commtss1on by the name, "the Kerala State Fanners' Debt Reltef 
Comm1ss10n", for the purpose of exerctstng the powers and perfomung the 
functions under this Act 
(2) The Comm1sston shall consists of five members, namely-
(0 a rettred High Court Judge Chamnan 
(11) an agncultural expert ' Member 
(w) two representatives of farmers Members 
{tv) a person workmg m connectiOn 
with econom1c/co-operauve sector Member 
(3) The Charrman and Members shall be nommated by the Government 
(4) The Government may, appomt a Secretary and other staff as may be 
necessary, to asstst the Commtsston m such manner as may be prescnbed 
(5) In the dtscharge of thetr duttes, the Secetary and other staff referred ~ 
to tn sub-sectiOn (4) shall be subJect to the admmlstrattve control of the 
Chamnan 
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\' 4 Term of the Comm1ssron and condztwns of sen1tce of the membe1s-
( 1) The tenn of the commtsston shall be 3 years. 
Provtded that, the Government may extend such pcnod, tf deem necessary . 
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(2) A member may, by wntmg under h1s hand and address to the 
Govefnment, restgn hts office ~t any ttme 
(3) A vacancy ansmg hy reason of rcstgnatton of any member of the 
Commtsston under sub-~ect10n (2) or otherw1se ~hall be filled up m accordance 
wtth the provtstons contamed m sectiOn 3 of tlus Act. 
Provtded that the person so appomted shall hold offtcc only for the 
remammg penod .of term of the person, m whose place he is nppomtcd • 
(4) Government may remove any member, tf he,-
(a) IS declared as undischarged msolvent, 
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(b) becomes mcapablc of contmumg as such, due to phys1cal or 
mental dtsabthty, 
-(c) becomes unsound mmd and stands so declared by a court of 
competent JUriSdictiOn; 
(d) has been convtcted for an offence, whtch m the opmton ot the 
Government mvolves moral turpltude or financial trregulantles; 
(e) has, m the opmton_ of the Government, abused l11s offtc1al 
posttton so as to render h1s contmuance m office prejud1c1al to pubhc mter.cst. 
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Provided that the person may be gtven an opportumty of bemg heard, before 
proceedmg as sue~ 
(5) The CommiSSion shall regulate Jts own procedure for the conduct of 
1ts busmess 
(6) The salary and allowances and the other cond1t1ons of scrvtce of the 
Chatrman and members shall be, as may be prcscnbcd 
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5 Powers and Functwns of the Commzsswn---( 1) The Commtsswn shall 
have all such powers as are necessary for achtevmg tl_lc obJects of thts Act, and 
m parttcular,-
(a) to recommend to the Government c1ther suo motu or on apphcat10n, 
after such enqutry as 1t may deem fit and subJect to such general gUJdeJmes as 
may be prescnbed by Government to declare a dtstnct or dt~tncts or part thereof 
or a crop or crops or a fanner, as dtstress affected area, dtstrcss affected c1op or 
dtstress affected farmer as the case may be; 
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(b) to ftx, m the case of creditors other than mstttutwnal creditors, a "V 
fatr rate of mtercst and an appropnate level of debt, to be payable as the 
Comm1sston may consider JUSt and reasonable by a farmer declared as dtstress 
affected or related to an area or crop declared as dtstress affected area or 
dtstress affected crop as per sectton 6 as the case may be, 
(c) to undertake concthatJOn for settlement of dtsputes between 
mdebted farmers and credttors, other than mstttutwnal credttors, on the basts of 
the fatr rate of mtercst and appropnate level of debt fixed under clause (b), 
(d) to adJUdicate disputes between farmers descnbed m clause (b) 
and creditors, other than mstitutJOnal credttors, and to pass awards whtch shall 
be bmdmg on both parties: ' 
Provided. that before passmg an award as per thts clause a credator shall ~ 
be g1ven a reasonable opportumty of bemg heard. 
(e) to enter mto negottat10ns wtth the credators for loan wa1ver, interest 
rate rehef, loan rescheduling or _ loan moratonum to fanners descnbed m 
clause (b), 
(f) to recommend to the Government regardmg the extent and the 
manner m whtch the debt rehef to be granted to the fanners; 
(g) to recommend to the Government to take over the entire or partial 
debt and exonerate the farmers, from the effects of the debt, 
(h) to recommend to the Government to do such acts as may be ~ 
necessary to ensure that future credit requirements of the .farmers are met 
through such agencies, as may be prescnbed, 
(1) to make penodacal reports to the Government generally on any 
matter pertammg to fanner mdebtedness, and 
(J) to perform such other functtOns and exerctse such other powers, as 
may be pres en bed 
(2) Issue orders keepmg m abeyance the repayment of all debts of 
fanners descnbed m clause (b) of sub-section (1) to the credt tors, other than 
mshtutwnal credttors, constdenng rhe nature of crops and crop loss, for a penod 
not Jess than one year but not more than 3 years 
Provtded that such orders shall be subject to the awards and directiOns 
under sub-sect10n ( 1) 
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( (3) Notw1thstandmg anythmg contamed m any other provtstons of th1s 
.. Act, any debt rehef granted to a fanner by way of wa1ver of prmctpal, mterest 
and penal mterest, tf any shall not exceed seventy five per cent 1f such debt •s 
fifty thousand rupees or less and fifty per cent, tf such debt exceeds ftfty 
thousand rupees, arrived at after settlement or rupees one lakh whichever ts 
less 
(4) An award passed by the Commtsston under clause (d) of sub-sccuon 
( 1) shall be final and shall not be calJcd m questiOn m any court 
(5) The awards of Comm1ssmn under clause (d) of sub- ~ecllon (1) shall 
be executed under the provrsrons of the Code of C1v1I Procedure, 1908 (Central 
Act 5 of 1908) as tf tt 1s decree of a C1v1l Court 
~ (6) The Comm1ssion shall, for the purpose of cxcrcts1ng the powers 
conferred by or under thts Act, have all the powers of a Ctvtl Court whtlc 
trying a sutt under the Code of C1v1l Procedure, 1908 (Central Act 5 of 1908), m 
respect of the followmg matters, namely-
(a) summonmg and enforcmg the attendance of any P!=rson and 
exammmg hun on oath, 
{b) reqUinng the dtscovery and productiOn of any documents, 
• (c) 
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recetvmg evtdencc on affidavit; 
(d) tssumg commtsston for the exammauon of Witnesses or for local 
mvesttgat10n, 
(c) mspectmg any property or thmg concemmg wluch any dectswn 
has to be t~kcn, 
(f) requtsttsonmg of any pubhc record or copy thereof from any court, 
authonty or office; and 
(g) any other .matter whtch may be prescnbed .. 
6. To declare as d1stress affected area or dJstre.\s affected crop - As 
soon as may be, after the recc1p\ o'f a recommendatiOn under clause (a) of sub­
sectton { 1) of sect ton 5, the Government shall declare, as the case may be, as a 
dtstress affected area or a dtstress affected crop 
7. Applzcatzon for debt re!tef-A farmer clatmtng any debt rehcf under 
thts Act shall fi)e an apphcatton before the Commt">Ston m the manner and m the 
fonn, as may be prescnbed · 
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8 Slttmgs of the Commzsswn.-(1) The Commisston shall hold its ) ... 
Slttmgs at such places and at such ttmes as may be determmed by tt· 
Pro\uded that the CommiSSIOn shall hold 1ts s1ttmgs m the respective 
distnct or dtstncts declared as distress affected areas to constder matters relatmg 
to the d1stress affected areas 
(2) The quorum for the s1ttmg of the CommiSSion shall be three 
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(3) The Corrumsston may m appropnate cases 1t deems fit, hold smmgs 
m dtstncts by cons'tltutmg a Bench conststmg of two or more members. 
Provtded that a member representmg the farmer m the Commtsston shall be 
mcluded m the Bench so constituted: 
Provided further that m case of the Bench constituted by the Comm1sston, 
the quorum for the meetmg of the Bench shall be the total number of members 
of that Bench or two whtchever ts less 
9 Speczal provtswns zn respect of ~ettlement of certazn loans taken _by 
farmer-( I) Notwtthstandmg anythmg con tamed m thts Act or m any other law 
or contract or dectee or order of any Court or Tnbunal, a member authonsed by 
the Co~mtsswn may mltlate negot1atton to,-
(a) reschedule short-term loans mto medmm term loans and medtum 
term loans mto long tenn loans, m respect of the debts ava1led of by a farmer 
descnbed m clause (b) of sub-sectwn (1) of sectson 5, from commerc1al banks or 
other scheduled banks, or '>-. 
(b) prov1de necessary, facthties for one ttme settlement of agnculture 
loans falhng under the category of non-performmg assets, as per the gUJdehnes 
1ssued by the· Reserve Bartk of Indta, or 
(c) wa1ve penal mterest as per the norms flXed by the Reserve Bank of 
lndta, wtth the concurrence of the Reserve Bank of Indta and the National Bank 
for Agnculture and Rural Development 
(2) Where any settlement of loan IS made under sub-sectton (1 ), the 
satd farmer shall be bound to repay such loan to the bank concerned, wtthm the 
penod allowed ,by such bank 
10 Re-schedulmg of loan<ii taken by a fat mer from fznancwf 
znslltutwns - ( 1) Notw1thstandmg anythmg contamed m thts Act or u1 any 
other law or contract or decree or order of any Court or Tnbunal, the 
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Commtsston may reschedule the recovery of loans avatled by a farmer descnhed 
m clause (b) of sub-secuon ( 1) of sectton 5 on or before the date of declaration 
as a distress affected area, dtstress affected crop under section 6 or a dtstrcss 
affected fanner from any fmanctal mstltutton notified by the Government for thts 
purpose. 
(2) Where the rescheduling of the loan ts made under sub-sectlon ( 1 ), 
the farmer shall be bound to repay such loan wtth interest to the financtal 
mstttutton concerned wtthm the penod allowed by Commtssion: 
, Provtded that the Commtsston may, on apphcatton by the fanner, exempt 
htm, by order, from the repayment of the same for the penod so rescheduled, 
for the reasons to be recorded: 
Provtded further that the fanner shall be bound to repay the ,;arne on 
such later dates, so flxed by the Commtsston. 
11 Bar of suzts, applzcatwns and other proceedzngs.-No sutt for 
recovery of debt shall be mstttutcd, or application for exccutton of a decree in 
respect of a debt shall be made agamst a fanner descnbed m clause (b) of sub­
section ( 1) of sectton 5 and no appeal, revas10n petttton or applicatton for revtew 
agatnst any decree or order m any such sutt or appltcat10n shall be presented of'"'~ 
made agamst such a farmer m any Ctvtl Court, or Tnbunnl or other authonty, 1 
and such sutts, apphcattons, appeals and petitiOns mstttutcd or made agamst 
such a farmer before the date of declaration of a dtstnct or pan thereof as a 
dtstress affected area and pendmg on such date shall stand stayed for such 
penod as the Commtsston may recommend in that behalf. 
12. Payment of debt zn mstalments.-( I) Notwtthstandmg anythang 
con tamed 1n any ·law or contract or in any decree or order of any Court or 
Tnbunal, a fanner descrtbed m clause (b) of sub-section (1) of scctaon 5 may 
dtscharge h1s debts m suttable mstalmcnts together wsth fa1r rate of interest as 
recommended by the Commass1on on the pnnctpal amount outstandmg at the 
tune of each payment, m the manner as may be dtrected by the Commiss10n and 
on payment of the same m the manner dtrected by the CommlSSJOD, the whole 
debt shall be deemed to be dtscharged. 
(2) Where may mstalment of a debt ts not paid on the due date as 
drrected by the Commtsston, the creditor shall be entitled to recover the same m 
the manner as may be detennmed by the CommissiOn. 
34/2504/201 0/0TP 
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Provtded that, before takmg dectston by the CornrnJSSJOn under thts r 
sectton, the fanner shall be glVen an opportumty of being heard 
13 The debt shall be deemed as fully repmd -Notw1thstandmg anythmg 
contamed m th1s Act or m any ~ther law or contract or m any decree or order of 
any Court or Tnbunal, tf a fanner has repaid the pnnctpal amount taken as loan 
by him and an amount equal to tt to a crcdttor other than mstttutiOnal credttor, 
the debt shall be deemed to be fully dtscharged by the satd farmer . 
14 Annual Report to be lazd before the Legzslatzve Assembly-( 1) The 
Commtsston shall prepare a report of Its function of that year under thts Act 3J1d 
the same shall be submitted to Government m such form on or before such date 
as may be prescnbed 
(2) The Annual Report submttted to the Government by the Conumss10n ':% 
under sub-section ( 1) shall be latd before the Legtslattve Assembly, as soon as 
may be, after the same ts recetved by the Government 
15 Accounts and Audll -(I) The Commtston shall mamtam proper 
accounts and other relevant records and prepare an annual statement of 
ac.counts, m such fotm as may be prescnbed 
(2) The accounts of the CommisSion shall be audtted annually and the 
audttcd report shall be placed before the Legtslattve Assembly. 
• 16. Overndzng effect of Act - The prov1s1ons of thts Act or any rule or 
order made thereunder shall have effect notwtthstandmg anythmg mconststent 
therewtth contamed m any law, other than tht~ Act, or any mstrument havtng 
effect by vn1Ue of any law other than thts Act 
17 Bm of Jurzsdzctzon of CLvzl Court -No cxvll court shall have 
JUrtsdtctwn to 'lettle, dectde or deal wath any question or to determme any 
matter wluch ts by or under the Act or the rule made thereunder are reqmred to 
be settled, dectded or dealt wtth or to be dctermmcd by the Commtsston or the 
Government· 
Provtded that nothtng m thxs sectiOn shall be applicable to the executton 
proceedmgs under sub-section (5) of ~cellon 5 . . 
l ~ Members of the CommtSswn shall be public sen'ants - Every member 
of the Comm1s~ton nommated under sub-sectiOn (1) of sectiOn 3 and the 
Secretary and other ~taff appomted under sub-sectiOn (4) shall be deemed to be 
a pubhc servant w1thrn (he meamng of sectiOn 21 of the Ind1an Penal Code, 
1860 (Central Act 45 of 1860). 
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'{ 19 Protectwn of actwn taken 1n good faith .-No sutt or Jegal 
proceedmg shall he agamst any member of the Commtsston or Secretary or other • 
officers for anythmg whtch ss done or purported to be done m good faith under 
thts Act 
20 Power to remove difficulties -(1) If any dtfficulty anses m gtvmg 
effect to the pt ovtstons of thts Act, the Government may, by order, as occasiOn 
requtres, do anythmg not mconststcnt w1th the provts1ons of thts Act, whtch 
appears to them to be necessary for the purpose of rcmovmg the dtfficulty· 
Provtded that no such order shal,l be made after the exptry of two years 
from the date of commencement of th1s Act 
(2) Every order made under tht~ secllon shall be latd before the 
Legtslattve Assembly 
21 Power to make rules.-( 1) The Government may, by nottficahon m 
the Gazette, make rules for the purpose of carrymg mto effect the prov1s10ns of 
thts Act. 
(2) Every rule made under thts sectiOn, shall be latd, as soon as may 
be after tt IS made, before the Leg1slattve Assembly whtle 1t ~~ m sesston for a 
total penod of fourteen days whtch may be compnscd m one scsston or m two 
successtve sessiOns and tf before the expuy of the sesston m whtch 1t 1s so latd 
or the sess10n tmmed1ately fo1lowmg, the Legt~lattve Assembly makes any 
-< modtficatJOn tn ·the rule or dectdes that the rules should not be made, the rule 
shall thereafter have effect only m such mod1fied fo1m or be of no effect, as the 
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case may be; so however that any such modaficat10n or annulment shall be 
wtthout preJUdt~e to the validity of anythtng prev10usly done under that rule. 

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