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2014 DIGILAW 980 (KER)

Leema Varghese v. State Bank of Travancore

2014-12-01

A.MUHAMED MUSTAQUE

body2014
JUDGMENT A. Muhamed Mustaque, J. 1. These Writ Petitions are filed by the students, who have availed educational loan from the respondent bank. Most of them have completed their course based on the educational loan availed by them. The issue in this Writ Petition pertains to granting the benefit of interest waiver to the loanees in terms of guidelines issued by the Government of India for relief on interest outstanding component on 31.12.2013 for all the education loan sanctioned availed up to 31.3.2009. In the budget 2014-15, the Central Government have introduced the Central Scheme for Interest Subsidy (CSIS) in respect of education loans which were availed up to 31.3.2009 and outstanding upto 31.12.2013. By which Government took over the burden of interest for the duration of the period of study and a little beyond. Therefore, the Government provided moratorium period for all education loans taken up to 31.3.2009 and outstanding on 31.12.2013. The Government took over the liability of outstanding interest as on 31.12.2013. The borrower would have to pay the interest for the period after 1.1.2014. The issue in this Writ Petition is regarding granting benefit of waiver interest for the students who have taken loan before 31.3.2009 and remained unpaid until 31.12.2013. According to the petitioners, respondents failed to grant the benefit to the petitioners. In this matter a detailed statement filed on behalf of the State Bank of Travancore. It is submitted that bank did not deny any benefit to the petitioners. On the other hand, the bank insisted for production of certain documents based on R1 (a) guidelines issued by the Government of India. In R1 (a) the benefit is restricted to the students belonged to economically weaker section and whose parental/family income is below Rs. 4.5 lakhs as on the date of availing loan. However it is stipulated that an income Certificate lies with the student/parents claiming relief under the scheme. Income proof, in the form of income Certificate Issuing Authorities (ICIA) as designated by the respective State Governments under the existing CSIS shall be required from the students. 2. It seems bank has also drafted an agreement in consensus with the guidelines. Therefore, It is submitted that borrowers which include all the parties will have to execute an agreement in the format. It is submitted that the only income proof and agreement need to be produced for granting the benefit. 2. It seems bank has also drafted an agreement in consensus with the guidelines. Therefore, It is submitted that borrowers which include all the parties will have to execute an agreement in the format. It is submitted that the only income proof and agreement need to be produced for granting the benefit. However the petitioner fails to produce income proof certificate. I have also gone through R1 (c) agreement. I do not find any other reason for refusing to execute R1 (c) agreement by the parties. The petitioner submits that they alone need to execute agreement and their parents who have executed the agreement cannot be asked to execute the agreement. Prima facie I think, this is not correct. The benefit of loan in which subsides is given to the borrower, and they are all the parties to the loan transaction with the bank. Therefore, wherever the parents and others who are parties to the loan agreement, necessarily they all have to execute the agreement. However the petitioner need not produce any document other than the income proof. 3. It is submitted by the learned Standing Counsel for the Nodal Bank in W.P.(C) No. 16973 of 2014, last date for claiming benefit under the interest subsidy was 31.8.2014. However it is submitted by the Standing Counsel for the 1st respondent bank that they have already forwarded the claims of the parties and they could not grant benefit only due to the delay in obtaining income proof certificate and execution of agreement of petitioner. Therefore, there shall be a direction to the respondent bank to process any application based on the agreement being executed by all the parties to the loan agreement and also producing income proof. If the petitioner executing the agreement by the persons who all are the parties to the loan transaction, necessary benefit shall be granted to the petitioner. The petitioner shall produce income proof and execute the agreement within two weeks from the date of receipt of a copy of this judgment. Thereafter the application shall be processed for interest subsidy within a further period of two weeks. The Writ Petition is disposed of.