26 April 2025, Bhopal: The Madhya Pradesh High Court has taken a strict stance regarding the 32,683 quintals of paddy stored at Siddheshwari Warehouse in Gwalior, Madhya Pradesh. The court ordered an immediate physical verification of the stock, emphasizing that the paddy represents the hard work of farmers and is essential for clearing their pending payments. Additionally, the ₹7.25 crore loan taken from the Central Bank of India against this paddy is tied to public funds. The court stressed the need to protect the interests of both farmers and the bank.
What is the Case About?
Durga Devi Trading Company had purchased paddy from farmers at the agricultural market (mandi) in Gwalior, Madhya Pradesh, but failed to make payments. The company packed the paddy into 54,400 sacks and deposited it in a warehouse, using the warehouse receipts to secure a ₹7.25 crore loan from the Central Bank of India. The dispute now revolves around whether farmers should be paid first from the auction proceeds or whether the bank’s loan should be secured.
High Court’s Displeasure and Directives
The court expressed strong displeasure over the slow pace of the verification process. In one and a half days, 20 workers managed to count only 2,100 sacks. The court ordered the Gwalior Collector to arrange 100 laborers and complete the verification within 15 days. The court also questioned the claims made by Alok Kumar Verma, Secretary of Laskar Krishi Upaj Mandi (Agricultural Produce Market Committee) in Gwalior, who had stated that the counting was completed within a few hours. The court termed the seizure report of the market committee as fake, noting that it did not even mention the warehouse’s name.
The role of the Central Bank of India also came under suspicion. The court termed the photographs submitted by the bank misleading and questioned how such a large loan could be sanctioned without proper verification. Collector Ruchika Chauhan was instructed to ensure the security of the warehouse. The next hearing is scheduled for 9 May.
Temporary Stay on Auction
The Laskar Agricultural Produce Market Committee in Gwalior had initiated the auction of the paddy to recover payments for the farmers. However, the Central Bank of India filed a petition in the Madhya Pradesh High Court, claiming that the warehouse receipts were pledged to them and that the auction would jeopardize their interests. Consequently, the court imposed a temporary stay on the auction.
High Court’s Tough Questions
The Madhya Pradesh High Court directed the Central Bank of India to submit all reports related to the verification of the paddy sacks and explain how the counting could have been completed in just a few hours. The court emphasized that it is essential to balance the interests of both farmers and the bank.
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