Consumer Commission Orders Refund of Crop Insurance Premium in Kanker Farmer Dispute

News Citation : 2026 LN (CGSCDRC) 18

March 05, 2026 : The Chhattisgarh State Consumer Disputes Redressal Commission has partly allowed an appeal filed by Agriculture Insurance Company Ltd. in a dispute involving a farmer from Kanker district, holding that although the farmer was not entitled to crop loss compensation, he must be refunded the insurance premium along with compensation due to service deficiencies by the bank and insurer.

The order was delivered on 5 March 2026 by a bench comprising Justice Gautam Chourdiya (President) and Pramod Kumar Verma (Member). The appeal challenged an earlier order of the District Consumer Commission, Kanker, which had partly allowed the farmer’s complaint.

The case arose from a complaint filed by Pushkar Prasad Mishra, a farmer from Kurana village in the Narharpur area of Kanker district. Mishra owns about 1.75 hectares of agricultural land and had taken a crop loan from the State Bank of India in 2020 for the kharif season. As part of the loan process, the bank arranged crop insurance coverage under the Pradhan Mantri Fasal Bima Yojana and deducted a premium of ₹1,505 from the farmer’s account.

However, when Mishra later sought compensation for crop loss, the insurance claim was not processed. According to the records, the bank had incorrectly entered the farmer’s land details on the National Crop Insurance Portal. Instead of recording the land under Kurana village, the data was uploaded for Markatola village.

Because of this incorrect entry, the insurance company assessed the claim based on the yield data of Markatola, where no crop loss had been reported. As a result, the farmer’s claim was rejected.

The insurance company argued that it relies entirely on the data uploaded by banks on the government’s crop insurance portal. It contended that it had no authority to alter the information entered by the bank and therefore could not be held responsible for the error.

The bank, on the other hand, claimed that it had uploaded the information based on the documents submitted by the farmer and suggested that any technical issue with the portal would fall under the responsibility of the insurer.

The Commission examined the records and found that the farmer’s land was indeed located in Kurana village. Evidence showed that the incorrect village name had been entered on the portal by the bank.

Despite acknowledging the data error, the Commission noted that the crop in question was irrigated paddy. According to the government notification for the 2020 kharif season, irrigated paddy in Kurana village had not been notified under the crop insurance scheme for compensation claims.

The Commission observed that even if the correct village had been recorded, the farmer would not have been eligible to receive crop loss compensation under the scheme.

However, the Commission also held that the farmer should not suffer because of errors committed by the bank and the insurance company. It noted that neither institution corrected the mistake nor refunded the deducted premium in time.

Finding this to be a deficiency in service, the Commission modified the earlier order and directed both the insurance company and the bank to jointly refund the premium amount of ₹1,505 to the farmer, along with interest at 6% per annum from the date of deduction.

In addition, the Commission ordered payment of ₹10,000 as compensation for mental harassment and ₹5,000 towards litigation costs.

The appeal filed by the insurance company was therefore partly allowed, with the District Commission’s order being modified accordingly.

Case Reference : Agriculture Insurance Company Ltd. vs Pushkar Prasad & Another; Appeal No. SC/22/FA/151/2025