JUDGMENT

Dated this the 11th day of January, 2022 S.Manikumar, C.J.

Before the writ court, the petitioner/appellant has sought for the following reliefs:

“i) Issue a Writ of Mandamus or any other Writ, order directing to the 1st Respondent to disburse the amount sanctioned as per Ext P3 in accordance with the requirement of course fee as scheduled Para 5.3 of Ext P4 Scheme, forthwith.

ii) Issue a Writ of Mandamus or any other Writ, order directing to the 1st Respondent to consider Ext P 5 and disburse Rs. 2.57 lakhs of 1st year fee and 2.85 lakhs as travelling expenses to the petitioners account forthwith.

iii) Issue a Writ, order or Direction, declaring that pro-rata basis of loan disbursal shall be in accordance with the yearly expenses for the course.”

2. After considering the rival submissions, writ court held as under:

“7. The application of the petitioner for educational loan of ₹7,00,000/- was against the total medical course expenses of ₹29,58,036/-, for the period of study of six years. The petitioner would submit that the Tuition Fee for the first year is ₹2.57 lakhs and the petitioner would require another ₹2.85 lakhs for travelling expenses in the First Year itself. The petitioner claims that the respondents shall disburse an amount of ₹5.42 lakhs out of the sanctioned ₹7 lakhs in the First Year itself.

8. Clause 28 of the Terms and Conditions in Ext.P3 Letter of Sanction issued to the petitioner would indicate that the Bank will disburse the loan in stages as per the requirement / demand directly to the school / College / University / Hostel / Institution / Book Seller, to the extent possible. Ext.R1(b) Model Educational Loan Scheme for Pursuing Higher Education in India and Abroad, 2021 formulated by the IBA and followed by the 1st respondentBank, provides that the Bank should ensure that a student is neither over financed or under financed. Therefore, the 1st respondent will be justified in releasing the loan amount proportionately taking into account the requirement in each year.

9. When the petitioner has himself to find resources for payment of ₹29,58,936/- minus ₹7,00,000/-, to meet the educational expenses, every year the petitioner has to raise proportionate fee himself. The petitioner cannot insist that the entire amount of loan sanctioned should be released in the initial academic year/s itself. If that is allowed, it would amount to over financing. The prayer of the petitioner in that regard cannot be allowed.”

Being aggrieved, instant writ appeal is filed.

3. Short facts leading to the filing of the appeal are as hereunder:

The appellant, along with his parents as co-applicants, applied for Baroda Education loan at 1st respondent Bank for his MBBS in Petro Mohyla Black Sea National University, at Ukraine. The total estimated cost of education is Rs. 29,58,936/-, but the appellant required only Rs.7 lakhs, that too, for the first two years. Subsequent to the interventions of this Hon’ble Court, the 1st respondent sanctioned the education loan of Rs.7 lakhs.

Though the loan is sanctioned, the 1st respondent is not disbursing the amount to the account. They orally intimated that only an amount of Rs. 1.16 lakhs will be disbursed as 1/6th of the total loan amount. The contention of the bank is that the pro-rata basis disbursal is calculated by dividing total amount and actual years of course. Against which, the petitioner preferred a petition to the bank requesting to sanction the 1st year fee amount in accordance with the fees structure of the College (First year Fee amount of Rs. 2.57 lakhs and Rs. 2.85 lakhs as travelling expenses) and also in accordance with the guidelines issued by the Reserve Bank of India.

The Exhibit P4 guidelines of RBI points out the objectives of the educational loan scheme. It is stated that the object of the scheme itself is to provide financial support from the banking system to meritorious students for pursuing higher education in India and abroad. The guideline Nos. 5.2 and 5.3 dealt wi