- (1.) We have heard Shri R. K. Chitra Gupta, learned counsel for the petitioner. Shri Rajeev Sharma appears for U. P. Khadi and Village Industries Board, respondent nos. 2,3 and 4. Shri Tarun Verma appears for the Punjab National Bank, Branch Parsa, District Siddharth Nagar, respondent no. 5. The Assistant Solicitor General of India has accepted notice on behalf of respondent no. 1.
(2.) The petitioners, in all the writ petitions are engaged in agricultural farming. They have their agricultural holdings in Distt. Siddharth Nagar. All the petitioners applied under a scheme floated by Khadi and Village Industries Commission, Mumbai, for the benefit of margin money against the bank finance for purchase of harvester combine, used for mechanized farming. The scheme provide for the purchase of harvester for Rs. 10 lacs in which the petitioner had to contribute Rs. 2,45,700/-. The bank was to provide a term loan of Rs. 7,50,000/- on which the Khadi and Village Industries Commission would deposit Rs. 3 lacs, as 30% of the total cost, as margin money in the petitioners' account. The scheme provides for purchase of harvester and payment of term loan in installments. On the completion of the payment of installments the margin money deposited in the account was to be adjusted towards the cost of the harvester. All the petitioners made their own contributions and were given term loans, which they are regularly paying in installments. The margin money of Rs. 3 lacs was deposited by the District Gramodyog Adhikari, Siddharthnagar in their accounts by forwarding drafts/ cheques directly to the Branch Manager of the Punjab National Bank.
(3.) The Chief Executive Officer in the Directorate of Rural Employment Generation Programme, in the office of the Commissioner for Khadi and Village Industries, issued a circular on 11.8.2005 directing all the Chairman and Managing Directors of all public sector banks, Chairman, Regional Rural Banks, all State/ Divisional Directors, all Chief Executive Officers of the State/ UT, Khadi and Village Industries Boards and the incharge of all RICS cells to withdraw the margin money from all harvester accounts. The Chief Executive Officer in the office of the Commissioner for Khadi and Village Industries, gave following reasons for withdrawing the margin money:- "Sub-Banning of "Harvester" Activity under Rural Employment Generation Programme-Reg As per the norms of Rural Employment Generation Programme Scheme, a ceiling limit on per capita investment of Rs. 50,000/- for creation of one full time employment has been prescribed. Instances were brought to the notice from the field that in certain village industries activities the per capita employment norm is not fulfilled. The matter regarding "Harvester" was brought to the notice of erstwhile Commissioner and the Commission in its decision No. 524 dt. 23.12.2003 authorised Chief Executive Officer to examine the matter. Accordingly, physical verification have been conducted in respect of existing units in Karnataka and Uttar Pradesh. In both the cases it is found that against the project cost of Rs. 10.00 lakhs the employment generation is 2 to 3 in number whereas the employment should be around 20. Moreover, it is also noted that this is a seasonal activity taking place during the harvesting season involving a tractor, one driver and one operator/ worker. In fact the activity is on agricultural activity involving the tractor during the harvesting season. Since the Harvester project does not fulfill the main criteria of employment, it has been decided to ban the harvester activity under REGP and State/ Divisional Directors of OCK VI and C. E. Os. of State/ U. T. Khadi & V. I. Boards are advised not to sponsor/ sanction margin money claims pertaining to Harvester project with or without tractor under REGP since it does not fulfill the per capita norms of employment and also falls under agricultural activity which is under negative list of REGP scheme. Since the issue pertains to fulfillment of REGP norms, the decision to call back margin money need not be prospective and has to be with retrospective effect Physical verification of existing units may be carried out on priority by the concerned field Directors of OCKVI and State/ U. T. Khadi and VI Boards and necessary action be initiated for recovery of Margin Money immediately under intimation to Directorate of REGP. The above circular may be brought to the notice of all the Public Sector Banks, Regional Rural Banks and other Banks directly and through notices circulated to SLBC/DCC/BLBC etc. for information and corrective action. (Maya S. Sinha) Chief Executive Officer";