Introduction:

In a landmark judgment, the Karnataka High Court addressed the issue of power tariff subsidies for farmer societies. The petitioners, Shrishail Irappa Kempwad and another, secretaries of cooperative societies in Athani Taluk, constructed lift irrigation projects on the Krishna River to benefit agricultural lands in Parthanahalli and Madhabhavi villages. They challenged a government order dated September 4, 2008, which denied power tariff subsidies to farmer societies based on collective consumption exceeding specified limits. The petitioners argued that this denial violated Article 14 of the Constitution, as it discriminated against marginal farmers who formed societies to manage irrigation collectively.

Arguments of Both Sides:

The petitioners contended that the government’s inaction forced farmers to create their irrigation solutions through cooperative societies. Despite their efforts, they were penalised by being denied subsidies available to individual farmers. They emphasised that the collective approach aimed to promote efficiency and sustainability in agriculture. On the other hand, HESCOM argued that the societies had entered into agreements accepting higher tariffs and that the government order applied only to individual farmers using 10 HP meters or below. The state government maintained that while individual farmers could avail subsidies, those who voluntarily formed societies were not eligible under the existing scheme.

Court’s Judgment:

Justice Sachin Shankar Magadum held that the government’s classification between individual farmers and societies lacked a rational basis and violated the principle of equality under Article 14. The court declared the impugned government order unconstitutional to the extent that it denied subsidies solely based on collective consumption. It directed the state government and electricity distribution companies to review and amend the policy framework within six months, ensuring that farmer societies receive subsidies on par with individual farmers. The court emphasised that denying subsidies to cooperative efforts contradicted the objectives of promoting sustainable agriculture and equitable resource access. While partly allowing the plea, the court instructed the societies to clear arrears and permitted them to seek subsidies under the revised framework. However, it rejected the petitioners’ request to set aside demand notices and declare the COVID-19 period as Force Majeure.