The Agriculturists’ Loans Act, 1884 was enacted by the British Government and passed by the Governor-General in Council on July 24, 1884 with the intent to modify and extend the Northern India Takkavi Act, 1879. The Act came into force on August 1, 1884. The Act extends to the entire Indian Territory except those parts that were included in the Part B States before November 1, 1956. The remaining of the Act extends to Uttar Pradesh, Delhi, Assam and Central Provinces and also those States which were included in the States of Ajmer, Punjab and Bombay prior to November 1, 1956. The Act empowers the State Government to extend the remaining portion of the enactment wholly or partially to the territories where the Act applies under its management. Accordingly, the Act has undergone various State Amendments in the States of Madras, Coorg, Orissa, Uttar Pradesh, Madhya Pradesh, Bombay etc. The Act aims to consolidate the legal principles governing the progression and recovery of Takkavi loans for agricultural needs.

The Act authorizes the State Government for the proper implementation of the Act. It states that the State Government or Board of Revenue of Financial Commissioner is granted the authority to frame rules with respect to loans and advances to be given to the owner as well as occupier of arable land, for the release of agony, buying of seed or cattle and in any matter which is silent in the Land Improvement Loans Act, 1883 but related with agricultural products. The rules shall be created as per the directions of the State Government. The rules framed according to the provisions of the Act shall be publicized in the Official Gazette. The loans and advances given as per the rule, the interest to be charged along with cost sustained in giving or recovering such loan shall be recovered from the debtor or from the surety for refund similar to that of land revenue. Such an initiative shall be taken by the creditor after the due date of the loan. When the loan is advanced to members belonging to village community or other persons according to the condition that such persons are obliged to the Government jointly and severally for payment of the entire sum which is due and contains a statement which states that the part of that sum which as between the others, each is under the obligation to give is agreed on the order funding the loan and is signed and sealed by all of them or the agent empowered in this connection and the officer proclaiming the order, such statement is said to be conclusive evidence of the part of the sum which is to be paid by each person.

The Act unifies all the laws dealing with agricultural credit and benefits both to the debtor and creditor dealing with agricultural loans. The primary intent of the framers of the Act is to minimize burden of the persons who advance agricultural loan and helps the persons who grants loan to recover the same easily. Such provisions will increase the agricultural sector as well as assist the lenders to get reasonable interest out of their income. Since during the British period, there was disputes regarding the advancement of agricultural loans and it gave rise to issues like non-payment, high interest rates, insufficient assets, low productivity etc. For these reasons the British Government has enacted the present legislation to make it harmonized with the situation prevailing in India.

The Act was amended in 1906 and 1914 and adapted by Government of India (Adaptation of Indian Laws) order, 1937 as well as Adaptation of Laws (No. 2) Order, 1956. There are some state amendments to the Act like The Agriculturists’ Loans (Orissa Amendment) Act, 1937, The Punjab Agriculturists’ Loans Act, 1958, The Agriculturists’ Loans (Madras Amendment) Act, 1935 etc.