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2024 Supreme(Online)(MAD) 29427
HIGH COURT OF MADRAS
G.R.SWAMINATHAN, J
THIRUMALAINAMBI – Appellant
Versus
THE BRANCH MANAGER – Respondent
Banks must adhere to specific eligibility criteria when processing educational loan applications, and courts will defer to these standards when reviewing refusals.
Headnote:
Loan - Educational Loan - Revised Guidelines on Model Educational Loan Scheme - The court evaluated the eligibility criteria set by the bank, referencing the Model Educational Loan Scheme, and concluded that the rejection of the loan application was justified based on the petitioner's academic performance and college choice.
Fact of the Case:
The petitioner sought to challenge the rejection of an educational loan application for his son, who completed higher secondary education with 63.25% marks and joined a private college under management quota.
Issues: Whether the bank's rejection of the educational loan application was arbitrary or justified based on established eligibility criteria.
Ratio Decidendi: The court held that banks have discretion in granting loans based on established eligibility criteria, and the petitioner did not meet these requirements, thus rejection was warranted.
Final Decision: The Writ Petition is dismissed.
The writ petitioner-s son Thiru.Yogiram completed his higher secondary education in March 2018. He secured 779 / 1200 marks (63.25%). He joined B.E (Mechanical Engineering) course in the third respondent college under management quota. The petitioner applied for education loan from the first respondent. The application was rejected vide communication dated 15.09.2019. Challenging the same, the present writ petition came to be filed.
2. The learned counsel appearing for the petitioner reiterated all the contentions set out in the affidavit filed in support of the writ petition.
He relied on the decisions reported in 2014 (4) CTC 363 ( Branch Manager, Indian Overseas Bank Vs. A.Ravi ) and 2012 WLR 640 ( A.Kasinathan Vs. The Branch Manager, Canara Bank ). He called upon this Court to grant relief as prayed for.
3. The bank had filed counter affidavit and also typed set of papers. The learned standing counsel took me through its contents. Their stand is that the petitioner-s application was considered by applying the relevant banking norms and that the decision making process has not been vitiated by any arbitrariness. The respondents 1 & 2 pressed for dismissal of the writ petition.
4. I carefully considered the rival contentions and went through the materials on record.
5. When the matter was taken up on the earlier occasion, a learned Judge of this Court made the following order:~
?The first respondent is present in person. His presence is Reserved On : 16.02.2024 Pronounced On : 13.05.2024 CORAM THE HONOURABLE MR.JUSTICE G.R.SWAMINATHAN W.P(MD)No.799 of 2021 and W.M.P.(MD)No.662 of 2021 Tirumalai Nambi ... Petitioner Vs.
For Petitioner : Mr.A.Shajahan For Respondents : Mr.ARM.Ramesh for R1 & R2 : No appearance for R3 ORDER The writ petitioner-s son Thiru.Yogiram completed his higher secondary education in March 2018. He secured 779 / 1200 marks (63.25%). He joined B.E (Mechanical Engineering) course in the third respondent college under management quota. The petitioner applied for education loan from the first respondent. The application was rejected vide communication dated 15.09.2019. Challenging the same, the present writ petition came to be filed.
2. The learned counsel appearing for the petitioner reiterated all the contentions set out in the affidavit filed in support of the writ petition.
He relied on the decisions reported in 2014 (4) CTC 363 ( Branch Manager, Indian Overseas Bank Vs. A.Ravi ) and 2012 WLR 640 ( A.Kasinathan Vs. The Branch Manager, Canara Bank ). He called upon this Court to grant relief as prayed for.
3. The bank had filed counter affidavit and also typed set of papers. The learned standing counsel took me through its contents. Their stand is that the petitioner-s application was considered by applying the relevant banking norms and that the decision making process has not been vitiated by any arbitrariness. The respondents 1 & 2 pressed for dismissal of the writ petition.
4. I carefully considered the rival contentions and went through the materials on record.
5. When the matter was taken up on the earlier occasion, a learned Judge of this Court made the following order:~
?The first respondent is present in person. His presence is acknowledged. He need not be present again. 2. The petition has been filed seeking grant of educational loan. Among other guidelines of the respondent Bank is that the student who seeks for a loan should obtain minimum of 65% in the core subjects. The petitioner has obtained over all 63.25% and in the core subjects 58.5%. It is contended that the petitioner is not eligible for grant of loan.
3. The learned counsel for the petitioner however still insists that a direction should be given to the respondent to consider the application of the petitioner for educational loan. That would necessarily mean that the Court will have to thrust upon the respondent an unwanted customer or a customer who according to the respondent is not eligible for the loan to be advanced.
4. I leave it to the
