The main legal point established is that the imposition of prepayment charges is justified when the borrower does not comply with the terms and conditions allowing prepayment without additional interest.

DEBANGSU BASAK, J.

1. The petitioners have assailed the imposition of prepayment charges upon the first petitioner prepaying the credit facilities.

2. Learned Senior Advocate appearing for the petitioners has submitted that, the first petitioner had enjoyed term loan facilities from the first respondent. Such credit facilities were governed by the terms and conditions of a sanction letter dated January 11, 2013. He has referred to the terms and conditions of such sanction letter, particularly, the clause relating to prepayment charges. He has submitted that, before the expiry of the time for reset of the interest, a second sanction letter was issued by the first respondent dated March 3, 2013. He has referred to the terms and conditions of the second sanction letter also. He has submitted that, on a true and proper construction of the terms and conditions of the two sanction letters, the first petitioner had repaid the credit facilities without prepayment charges being attracted. He has referred to the various correspondence exchanged between the parties in this regard, including the letters dated June 5, 2015, July 27, 2015 and August 14, 2015 of the first petitioner, and the response dated September 14, 2015 issued on behalf of the first respondent. He has submitted referring to 2015 Volume 4 Supreme Court Cases page 136 (Kailash Nath Associates v. Delhi Development Authority & Anr.) that, the first respondent has to suffer some loss to invoke the prepayment clause. He has submitted that, the first respondent did not suffer any loss. Even the affidavit-in-opposition of the first respondent, does not speak of any loss being suffered by the first respondent, at the behest of or by the conduct of the first petitioner. The first petitioner had substantial amount to its credit in the bank account with the first respondent. The first respondent had acted unilaterally, and without the support of law, in adjusting the prepayment charges from the credit balance, available in the bank account of the first petitioner, maintained with the first respondent. The claim of the first respondent not being quantified, and adjudicated by an appropriate authority, the first respondent was not entitled to adjust, any claim from out of the proceeds, of the bank account of the first petitioner, maintained with the first respondent. Therefore, he submits that, the first respondent be directed to reverse the amount deducted on account of prepayment charges.

3. Learned Advocate appearing for the respondents has submitted that, the writ petition is not maintainable in view of the fact that, the first petitioner had approached the Ombudsman on the selfsame subject matter. The Ombudsman upon hearing the parties had rejected the claim of the petitioners by its order dated June 13, 2016. Such order of the Ombudsman is not under challenge. In view of the issue raised by the petitioners being decided by the Ombudsman, the petitioners are not entitled to any relief in the present writ petition. In support of his contention, he has relied upon 1996 Volume 1 Supreme Court Cases page 435 (State of Kerala v. M.K. Kunhikannan Nambiar Manjeri Manikoth, Naduvil & Ors.).

4. Referring to the merits to the claim of the petitioners, learned Advocate for the respondents has submitted that, the first petitioner did not fulfil the requisite conditions of prepaying the loan, without the penal charges for prepayment being attracted. He has submitted that, both the sanction letters contemplate and impose a condition that, prepayment is possible without payment of additional interest being attracted, should such prepayment is made, in accordance with the terms of the sanction letters. Both the sanction letters allow the first petitioner, a window of opportunity, in prepaying the loan amount without the imposition of prepayment charges. He has referred to clause 17 of the sanction letter dated January 11, 2013 and has submitted that 90 days advance notice, from the date o