SC fumes over the growing trend of Seed companies engaging in frivolous litigations with farmers

Supreme Court: Alarmed by the growing trend amongst seed companies of engaging in frivolous litigation with farmers, virtually defeating the purpose of speedy redressal envisaged the Consumer Protection Act, 1986, the bench of MM Shantanagoudar and R. Subhash Reddy, JJ has said that the summary redressal available to the farmer under the 1986 Act may go a small but crucial way to provide instant relief in a sector which is already facing stress on several counts.

The Court was hearing a case where a Seed Company was contesting the farmers’ claims before consumer fora on the preliminary point of maintainability right up to the Supreme Court, compelling small agriculturists such as the Respondents to spend unnecessarily on litigation in order to secure relief for themselves, amounting to a sum which probably exceeds even the quantum of relief claimed. Rebuking the company, the Court said,

“This tendency to resist even the smallest of claims on any ground possible, by exploiting the relatively greater capacity of seed companies to litigate for long periods of time, amounts to little more than harassment of agriculturists.”

Discussing the serious issue of Farmer suicides, the Court observed that most Indian farmers own only small landholdings, which require expensive inputs such as irrigation, electricity, seeds, fertilizer, and pesticide, but do not generate sufficient output to cover the costs of the same. It further said that when agriculturists with such small landholdings do enter into agreements to grow crops on terms dictated by seed companies, it is in the hope of earning some profit that would offset the cost of their inputs and generate some income for the household.

“the success or failure of the crop would make or break the income of the farmer for the entire season. This can result in situations where small and medium scale farmers find themselves trapped in contracts where they buy expensive seeds which turn out to be defective, resulting in a failed season and severe financial hardship. The problem of indebtedness further worsens the plight of the farmer, and, all too often, manifests in the tragedy of suicide.”

The Court, hence, said that though the farmers faced with grievances against seed companies, may, in suitable cases, opt for other remedies such as a civil suit, relief under the Seeds Act, 1966, but excluding such farmers from the purview of the 1986 Act would be a complete mockery of the object and purpose of the statute. The Court, hence, held that the respondent Farmer in the case at hand was a “consumer” under the 1986 Act.

[Nandan Biomatrix Ltd. S. Ambika Devi, 2020 SCC OnLine SC 309, decided on 06.03.2020]

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