The Madras High Court on Monday directed a nationalised bank in Tiruvarur district to produce all records pertaining to RBI guidelines on granting educational loans, by July 23 after the bank declined to grant loan to a student aspiring to be a nurse, on the ground that her father was a defaulter.
It also noted that the bank was not doing any charity by extending loan, as interest was charged on the amount sanctioned.
The Thalaignayiru branch of State Bank of India in that district had refused to grant the loan to Deepika of Nagapattinam district, on the ground that her father was a defaulter.
When the plea by A Deepika came up, the second division bench comprising Justices Huluvadi G Ramesh and
M Dhandapani orally directed the bank branch manager to appear with all the records pertaining to RBI guidelines on granting educational loans by July 23.
It then adjourned the matter to that date.
The judges asked the counsel for the bank whether it was charging any lesser interest for the loan and what was the criteria for sanctioning it.
Also, they sought to know the criteria for fixing 60 per cent marks as eligibility for the loan.
If the branch manager was unable to prove the eligibility and guidelines, then suo motu would be taken up, the bench added.
During the hearing, the petitioner submitted that she got admission for the BSc nursing course in Karthikeyan College after the approval of the Indian Nursing Council, but did not have the means for paying the fees as she was from a downtrodden community.
Hence, she sought Rs 3.40 lakhs as loan from the bank which insisted that she provided her income certificate, identity card, address proof and other relevant documents.
Though all the documents were submitted, the bank denied the loan on the ground that the course did not come under the Indian Banks Association Educational Loan scheme and that her father was a defaulter, the petitioner said.
Challenging this, she moved the High Court and a single judge dismissed her petition following which she filed the appeal.
The single judge had said that banks were giving loans to several persons under various "political pressures" and those who defaulted on repaying them flee from the country.
Noting that whether the amount was small or huge, it needed to be recovered from the defaulters, the judge had said the SBI, in this case, was right in rejecting the petitioner's loan application.