Back
2024 Supreme(Online)(KER) 1572
HIGH COURT OF KERALA
N. NAGARESH, J
ALEYAMMA CHACKO – Appellant
Versus
THE STATE BANK OF INDIA – Respondent
WP(C) 12101/2024
Financial institutions are required to expedite reviews of applications for government assistance under schemes designed to support borrowers, ensuring due process and a fair hearing.
Headnote:
Loan - Writ Petition - Stand-Up India Scheme: Sections Referenced - The court addressed the provisions of the Stand-Up India Scheme, emphasizing the eligibility for government assistance and the obligation of the bank to consider the petitioner's representation promptly, upholding the right to personal hearing.
Fact of the Case:
The petitioner, a widow with financial difficulties, faced challenges in repaying a loan from the Bank due to business losses from catastrophic floods. She claimed lack of insurance coverage despite being charged for it and sought government assistance under the Stand-Up India Scheme.
Finding of the Court:
The court found merit in the petitioner's plea for consideration of her application under the Stand-Up India Scheme, recognizing her predicament and the bank's potential mismanagement in addressing her financial situation and application.
Issues: The primary issue was whether the Bank should consider the petitioner's request for benefits under the Stand-Up India Scheme and address her representation regarding the loan repayment.
Ratio Decidendi: The court affirmed that financial institutions must facilitate borrowers' claims under government schemes and that claimants are entitled to a timely decision and personal hearing regarding their requests.
Final Decision: The petition was disposed of, directing the Bank's Authorized Officer to consider the representation within a week.
Dated this the 2nd day of April, 2024 The petitioner had availed loan from the 1st respondent- Bank. Substantial amounts have been repaid by the petitioner. But due to reasons beyond her control, she could not keep up with the repayment schedule. The petitioner was running a Boutique. During the Floods in 2018, all the stock in the godown was damaged and the petitioner sustained substantial loss.
2. The petitioner approached the Bank for getting insurance coverage. The petitioner was shocked and surprised to know that no insurance policy was taken by the Bank. However, they had charged for stock insurance. The petitioner is a widow having three daughters and a son. The petitioner had repaid a large amount to the 1st respondent- Bank. The credit facility extended to the petitioner was under Stand-Up India Scheme and is eligible for guarantee cover under the Credit Guarantee Scheme. Therefore, the petitioner submitted an application to get the benefit of the Scheme. But, no action has been taken by the 1st respondent so far. Hence, the petitioner is before this Court.
3. Standing Counsel entered appearance and resisted the writ petition. The Standing Counsel pointed out that the petitioner had earlier approached this Court filing O.P(DRT) No.474 of 2022 and this Court as per Ext.P1 judgment had granted opportunity to the petitioner to repay the outstanding amount in easy instalments. The petitioner has not availed the benefit thereof. A new contention is being raised by the petitioner only to delay and defeat the recovery process, contended the Standing Counsel for the respondents.
4. I have heard the learned counsel for the petitioner and the learned Standing Counsel for the respondents.
5. The grievance projected by the petitioner is that the loan availed by the petitioner is under a Stand-Up India (SUI) Scheme, where the Central Government is giving substantial grant / financial assistance to new entrepreneurs. Instead of availing the subsidy / financial assistance directly from the Central Government, the Bank is trying to recover the entire amount from the petitioner. Be that as it may, the petitioner has submitted Ext.P2 representation to the Authorised Officer, State Bank of India.
In the facts of the case, the writ petition is disposed of directing the Authorised Officer, State Bank of India, SARB, Trivandrum to consider Ext.P2 representation submitted by the petitioner and take appropriate decision thereon, as expeditiously as possible and at any rate, within a period of one week from the date of receipt of a copy of this judgment.
The Authorised Officer shall give an opportunity of personal hearing to the petitioner. The petitioner is directed to be WP(C) No.12101 of 2024 present before the Authorised Officer, SARB, Trivandrum at 11.00 a.m. on 05.04.2024 for this purpose.
