Shiromani Punjab Forum puts a proposed draft Bill into the public domain for discussion
Chandigarh, 9 November 2026 (Yes Punjab News)
Punjab’s law for settling farmers’ debts to private moneylenders has, in ten years, not decided a single farmer’s application, and has worked as an instrument of expeditious recovery for arhtiyas rather than a means of settling debt. This was stated by KBS Sidhu, former Special Chief Secretary, Punjab, and Convener of the Shiromani Punjab Forum, a non-partisan think-tank, as the Forum put into the public domain, for discussion, a proposed draft Bill to replace it.
The occasion is the disposal by the Punjab and Haryana High Court, on 2 November 2026, of a writ petition filed in 2016 by Lt. Col. Jasjit Singh Gill (Retd.), the Ludhiana environmentalist, seeking Tribunals under the Punjab Settlement of Agricultural Indebtedness Act, 2016. The State told the Court that no farmer had applied to the Forum under the Act and no order had been passed, so no occasion had arisen for a Tribunal.
“Silence is not satisfaction,” said KBS Sidhu. “The 2016 Act was doomed to fail. It discharged no debt; it merely did the arithmetic of what was owed. The arhtiya could invoke it as readily as the farmer, and its orders were executable as civil decrees. The 2018 amendment then moved the Forums to divisional headquarters, the Government never once advertised them, and the Tribunal was never constituted.”
The proposed draft Punjab Agriculturists’ Debt Relief and Protection Bill, 2026, provides that:
• the 2016 Act be repealed and, on the appointed day, every debt owed by an agriculturist or agricultural labourer to a private lender stand annulled; banks, co-operatives, NABARD and RBI-regulated lenders are excluded;
• pronotes, undated agreements to sell and uncleared cheques held as security cease to have effect;
• a lender, licensed or not, may claim before the Sub-Divisional Magistrate within 90 days, failing which the debt is extinguished, with the burden of proof on the lender;
• the SDM apply fixed rules, without discretion: cash advances above the Income-tax Act’s limit of Rs 20,000 count at 40 per cent, bank advances in full, interest at 8 per cent on the reducing balance, and every payment made by the farmer credited first to principal;
• where the farmer has already paid more than is due, the excess, with interest, be refunded by the lender and recovered from him as arrears of land revenue;
• the balance be payable in ten half-yearly instalments after harvests, with the farmer’s land, house, cattle and standing crop protected from attachment;
• suits pending without a decree abate, while cases already decided by a court run their course;
• appeals lie to the Collector, with revision before the Divisional Commissioner and suo motu powers with the Financial Commissioner (Revenue);
• nothing be made a criminal offence, but a lender who repeatedly appeals and loses may be penalised by the District Judge up to the amount claimed;
• future private lending require a licence, banking channels, interest capped at 8 per cent, and no land papers or blank cheques as security.
“Only the lender can open the account, and it is a calculated risk,” KBS Sidhu said. “A farmer who has settled keeps his peace. An arhtiya who claims must do his homework, because the same rules may show that he owes the farmer a refund.”
The Bill carries a declaration under Articles 39(c) and 46 of the Constitution and is to be reserved for the President’s assent.
A copy of the proposed draft Bill has been sent to the Chief Secretary, Punjab, and circulated, with an executive summary, to all political parties and farmers’ organisations in Punjab for open discussion.
KBS Sidhu, IAS (Retd.), is a former Special Chief Secretary and twice Financial Commissioner Revenue, Punjab; Founder-Editor, The KBS Chronicle; and Convener, Shiromani Punjab Forum.
Contact: kbs.sidhu@gmail.com | 7837-001-001
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