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2021 Supreme(Online)(KER) 17187
HIGH COURT OF KERALA
P. G. Ajithkumar, J
AFSAL S., – Appellant
Versus
UNION OF INDIA, – Respondent
WP(C)/15248/2021
R.KISHORE (KALLUMTHAZHAM), JOSEPH RONY JOSE, CGC K.M.ANEESH ADARSH KUMAR DILEEP CHANDRAN SHASHANK DEVAN
Failure in one subject does not bar a student from obtaining an educational loan under the Model Educational Loan Scheme, as long as the application meets other criteria.
Headnote:
Loan - Educational Loan Application - Model Educational Loan Scheme 2021 - The court determined that failure in one subject does not disqualify a student from obtaining an educational loan, emphasizing the need for banks to adhere to the guidelines set by the RBI.
Fact of the Case:
The petitioner, a B.Sc Physician Assistant student, applied for an educational loan in 2019 but faced delays due to claims of failure in a subject, despite being unwell during his exams.
Finding of the Court:
The court found that the bank's refusal to process the loan application based solely on the petitioner failing one subject was unsustainable and contrary to the provisions of the Model Educational Loan Scheme.
Issues: Whether the bank's rejection of the educational loan application based on the petitioner’s failure in one subject was justified under the Model Educational Loan Scheme.
Ratio Decidendi: The scheme does not state that failure in a subject disqualifies a loan application, and banks must process applications in accordance with RBI guidelines and the Scheme's requirements.
Final Decision: The court directed the bank to process and sanction the educational loan within one month.
JUDGMENT
The petitioner is a student pursuing his career in B.Sc Physician Assistant Course in Shanmugha College of Allied Health Sciences, Salem. It is the case of the petitioner that the petitioner submitted an application before the 5th respondent for an educational loan. It is the further case of the petitioner that the loan application was submitted in 2019 and the same was not disbursed to the petitioner even now. It is the further case of the petitioner that he was laid up during his 1st year examination because of viral fever and he was not able to perform well in his 1st year examination due to his illness. The petitioner already appeared for the supplementary examination along with 2nd year and he is awaiting results. It is the case of the petitioner that the Bank is not sanctioning the loan giving frivolous reasons. After repeated enquiry, the Bank had given a letter to the petitioner stating that the loan is under consideration. Ext.P1 is the letter issued by the Shanmugha College of Allied Health Sciences, Salem which shows that the petitioner is studying in that College for B.Sc Physician Assistant Course. Ext.P2 is the letter issued by the 5th respondent to the petitioner in which it is submitted that the resubmitted loan application by the petitioner on 28.12.2020 was processed and submitted to the Regional Office, Thiruvananthapuram for further direction on 31.12.2020. It is also stated in Ext.P2 that the application is pending with the Regional Office. But, it is also stated in Ext.P2 that as per the 1st year marklist, the petitioner failed in the main subject. Hence, the 5th respondent informed all the matters to the Regional Office and awaiting for their clearance. The specific case of the petitioner is that the Bank is not following the circular issued by the RBI as well as policies of the Government with respect to educational loan application of the students. Ext.P3 is the circular issued by the RBI and Ext.P4 is a judgment of this Court. It is also stated by the petitioner that he submitted a representation before 1st respondent against the illegal stand of the 5th respondent, as evident by Ext.P5. The representation submitted before the 3rd and 4th respondents is Ext.P6. Even then, the loan is not sanctioned. Hence, this writ petition is filed with following prayers :
“a) Issue a writ of mandamus or order or direction to the 5th respondent to grant the educational loan to the petitioner as per Exhibit:P3 within a time fixed by this Hon'ble Court.
b) Issue a writ of mandamus or order or direction directing the 3rd and 4th respondent to consider and pass orders on Exhibit:P6 representation filed by the petitioner in the interest of Justice.
c) To grant other orders which this Hon'ble Court deem fit and proper in the circumstances of the case.
d) Grant the cost of this Petition.”
2. Heard the learned counsel for the petitioner and the learned Standing Counsel for the respondent – Bank. I also heard the CGC for the 1st respondent.
3. The learned counsel for the petitioner reiterated his contentions in the writ petition. The counsel submitted that nowhere in the Model Educational Loan Scheme for Pursuing Higher Education in India and Abroad, 2021 (for short 'the Scheme'), it is stated that if an applicant for educational loan failed in a subject in a course, for which the loan application is submitted, he is not entitled educational loan. The counsel submitted that in the qualifying examination, the petitioner succeeded and relevant documents were already produced. The counsel submitted that the stand of the respondents that since the petitioner failed in one subject in the course for which he wants the educational loan, he is not eligible is not a reason to reject the educational loan. The counsel submitted that he was laid up with viral fever and he was not able to perform well in the 1st year examination of the course for which he submitted the loan application. That is why he failed in the examination and
