In an effort to help farmers procure loans from banks in a hassle-free manner, the Punjab government has decided to amend the law dealing with the mortgage of agriculture land.
As per the proposed amendment, the government is eliminating the role of the revenue department and simplifying the process. A farmer seeking a loan would enter into an agreement with the bank concerned; subsequently, a copy of the agreement would be sent to the revenue department for record purposes. Punjab chief minister Parkash Singh Badal has agreed in principle to the amendment.
A proposal for amending the Punjab Agricultural Credit Operations and Miscellaneous Provisions (Banks) Act, 1978, sent by the agriculture department to the financial commissioner, revenue; registrar, cooperative societies; convener, state-level banker committee; and director, institutional finance and banking; for comments. Subsequent to the approval by the council of ministers, expected shortly, an ordinance would be issued and it would become a law after approval in the Vidhan Sabha.
The proposal sent by the agriculture department said 35% of the revenue department's work deals with land mortgage registration.
"A decision in favour of the amendment would save the revenue department a lot of futile work and also save farmers seeking loans from making rounds of offices of tehsildars and naib tehsildars. Besides, they would no longer have to struggle to get documents made and bribe middlemen to get these registered," said a senior official of the agriculture department. It was also revealed that there would be no financial implications of the decision on the revenue department.
The proposed amendment in sections 4(a) and 4(b) of the Act says, "Whenever an agreement for loan in exchange of agriculture land as mortgage is created in favour of a bank by the farmer seeking the loan, the bank may give intimation in writing to the tehsildar or naib tehsildar within the local limits of whose jurisdiction the whole or any part of the property mortgaged is situated or such other revenue official as may be designated in this behalf by the state government, of the particulars of the charge in its favour."
The tehsildar, naib tehsildar or any other revenue official shall make a note of the particulars of charge in the record of rights relating to the land over which the mortgage has been created. Earlier the farmer had to pass through the process of registration of agreement with the bank for loan, further with tehsildar and naib tehsildar and it used to take two to three days for a farmer to get his loan agreement registered with the revenue department.