Raj HC directs Nagaur Co-operative Bank to pay PMFBY crop claims, upholds High Level Committee order

Jaipur/Jodhpur: The Rajasthan High Court has held that farmers cannot be deprived of crop insurance benefits under the Pradhan Mantri Fasal Bima Yojana (PMFBY) due to errors committed in uploading data on the National Crop Insurance Portal (NCIP), and directed the Nagaur Central Cooperative Bank Ltd. to disburse the admissible insurance claim amounts along with applicable interest within eight weeks. farmers

The order was passed by Justice Kuldeep Mathur in a batch of writ petitions led by S.B. Civil Writ Petition No. 16961/2025, Purna Ram vs Union of India & Ors., along with connected matters, decided on 17.02.2026.

The batch comprised writ petitions filed by two sets of parties: farmers of Patwar Area Kamediya, District Nagaur, and the Nagaur Central Cooperative Bank Ltd. The farmers sought enforcement of the orders dated 09.10.2024 and 03.01.2025 passed by the High Level Committee constituted by the Ministry of Agriculture & Farmers’ Welfare, directing settlement of their Kharif 2020 crop insurance claims. The Co-operative Bank, on the other hand, challenged the said orders and sought their quashing.

The petitioners–farmers, members of Cooperative Gram Seva Sahkari Samiti Ltd., Kamediya, had opted for the Kharif 2020 crop insurance policy under PMFBY and paid the requisite premium through the Co-operative Bank. Due to scanty rainfall in 2020, their crops suffered extensive damage. However, their claims remained unsettled because the Patwar Area “Kamediya” was incorrectly entered as “Kherat” on the National Crop Insurance Portal.

The farmers submitted representations on 05.04.2021 seeking correction and later approached the High Court in earlier rounds of litigation. Pursuant to judicial directions, the High Level Committee examined the matter and, by order dated 09.10.2024, held the Co-operative Bank liable for settlement of claims, observing that the incorrect entry was attributable to inadvertence in the uploading process. The Committee reiterated its directions on 03.01.2025 after considering the Bank’s objections.

Despite these orders, the Co-operative Bank declined to disburse the claims, leading to the present batch of petitions.

On behalf of the farmers, it was contended that they had fulfilled all requirements under PMFBY and had no role in the data entry process on NCIP. They argued that they could not be penalised for a clerical error committed by bank officials and that denial of compensation defeated the object of the welfare scheme.

The Co-operative Bank argued that it functioned merely as an intermediary, uploading data supplied by the Primary Co-operative Society and remitting premiums. It contended that the error originated from the Society and that the High Level Committee exceeded its jurisdiction in fastening liability on the Bank.

The Court noted that it was undisputed that the farmers had opted for coverage under PMFBY, paid the premium within time, and suffered crop loss due to scanty rainfall. The sole reason for denial of claims was incorrect mentioning of the Patwar/revenue village on NCIP.

Referring to the revamped operational guidelines of PMFBY, particularly clauses 2.9, 2.11, 17.2, 35.5.9 and 35.5.13, the Court observed that banks and intermediaries are mandatorily required to upload correct farmer data on NCIP and are responsible for claims where farmers are denied benefits due to incorrect or non-uploading of details. The guidelines expressly provide that concerned banks shall be liable to pay admissible claims if farmers are deprived of insurance cover due to such deficiencies.

The Court also took note of the findings recorded by the High Level Committee that the Nagaur Central Cooperative Bank had raised and received service charges at 4% of the farmers’ premium for enrolment under the scheme. The Committee observed that the Bank had remitted the premium, created login credentials for PACS users, and availed service charges for all entries, including those incorrectly entered, and therefore responsibility for deficiency in service could not be disowned.

Rejecting the Bank’s contention that it was merely a middleman, the Court held that the scheme casts a specific responsibility on banks to ensure correctness of data before uploading it. The farmers had neither access to NCIP nor any role in uploading data. Any error at that stage, therefore, could not be visited upon the beneficiaries.

The Court emphasised that PMFBY is a welfare scheme intended to provide timely financial support and income stability to farmers facing crop loss. Denial of benefits on account of technical errors committed by implementing agencies would defeat the very object of the scheme.

Accordingly, the writ petitions filed by the Nagaur Central Co-operative Bank Ltd. challenging the orders dated 09.10.2024 and 03.01.2025 passed by the High Level Committee were dismissed. The writ petitions filed by the farmers were allowed. The Bank was directed to comply with the High Level Committee’s orders and to disburse the admissible insurance claim amounts along with applicable interest within eight weeks from receipt of a certified copy of the order. No order as to costs was passed.

Case Title
Purna Ram vs Union of India & Ors. (and connected matters)

Lead Case Number
S.B. Civil Writ Petition No. 16961/2025

Court
High Court of Judicature for Rajasthan at Jodhpur

Bench
Justice Kuldeep Mathur

Date of Order
17/02/2026

Advocates
For Petitioners (Farmers): Mr. Ram Dev Potalia; Mr. Sunil Choudhary
For Respondents: Mr. Surendra Choudhary; Mr. TRS Sodha; Mr. Deepak Bora; Mr. Brijesh Bhintal for Mr. Kirta Ram Meghwal on behalf of Union of India