Allowed

Jimson Titus v. the Chief Manager

Kerala HC8 Dec 2021WP(C)/21235/2021

Case brief

AI extract

What is this about?

Petitioner sought a writ to direct the bank to release the full sanctioned educational loan immediately for his first year abroad. The court held that releasing the entire amount at once would cause over-financing. It directed the bank to release only the proportionate amount eligible for the first year.

What did the court decide?

Directed the 1st respondent to release the eligible proportionate amount of fee for the first year immediately without further delay.

Jimson Titus Vs the Chief Manager — Service and Employment | Kerala HC (2021)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR.JUSTICE N.NAGARESH

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WEDNESDAY, THE 8^TH DAY OF DECEMBER 2021/17TH AGRAHAYANA, 1943

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WP(C) NO. 21235 OF 2021

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PETITIONER:

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JIMSON TITUS AGED 20 YEARS S/O. TITUS, THANNIPPILLY HOUSE, NADATHARA P. O., MINOR ROAD, PIN - 680 751.

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BY ADVS.

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SHERRY J. THOMAS JOEMON ANTONY

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RESPONDENTS:

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1 THE CHIEF MANAGER BANK OF BARODA, THRISSUR BRANCH, THIRUVAMBADY DEVASWOM BUILDING, ROUND WEST, THRISSUR, KERALA - 680 001.

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2 THE GENERAL MANAGER RESERVE BANK OF INDIA, REGIONAL OFFICE, BANERJI ROAD, ERNAKULAM NORTH, KALOOR, ERNAKULAM - 682 018.

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BY ADVS. NAGARAJ NARAYANAN SAIJO HASSAN BENOJ C AUGUSTIN RAFEEK. V.K. U.M.HASSAN P.PARVATHY AATHIRA SUNNY NAZRIN HALLAJ NASEEBA K.T. SHILPA M.RAJAN

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.12.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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W.P.(C) No.21235/2021

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N. NAGARESH, J.

Dated this the 8^th day of December, 2021

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J U D G M E N T

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~ ~ ~ ~ ~ ~ ~ ~ ~

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The petitioner, who has been sanctioned an educational loan by the 1^st respondent, seeks to direct the 1^st respondent to disburse the amount sanctioned as per Ext.P3 in accordance with the requirement of course fee as scheduled in Paragraph 5.3 of Ext.P4 Scheme forthwith.

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The petitioner wanted to join MBBS Course in Petro Mohyla Black Sea National University, Ukraine. The course expense was ₹29,58,036/-. The petitioner was sanctioned an educational loan of ₹7,00,000/- by the 1^st respondent as per Ext.P3 Sanction Letter. The Bank has now informed the petitioner that they will release only a part of the loan amount in the 1^st academic year.

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W.P.(C) No.21235/2021

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: 3 :

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The petitioner states that an amount of ₹2.4 lakhs

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has to be paid by the petitioner in the First Year towards tuition fee alone. The petitioner has to spend a considerable amount towards Air Fare also. Ext.P4 Educational Loan Scheme issued by the Reserve Bank of India (RBI) categorically states that the Educational Loan Scheme is intended to provide financial support to deserving/meritorious students for pursuing higher education in India and abroad. Partial disbursement of loan by mere division of the loan amount with number of years of course, would result in under finance, which the RBI Scheme specifically condemns.

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Clause 28 in the Terms and Conditions in the

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Loan Sanction Letter also confirms that the loan will have to be disbursed in stages as per the requirement directly to the College. Therefore, the respondents are bound to release the amount required by the University/College for the First Year, from the ₹7 lakhs loan sanctioned. The petitioner prayed that the respondents be directed to pay ₹2.57 lakhs of First Year Course fee and ₹2.85 lakhs as travelling

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W.P.(C) No.21235/2021

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: 4 :

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expenses.

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The respondents resisted the writ petition. The respondents stated that since the loan sanctioned covers only a portion of total fees/expenses, the amount can be released only on pro rata basis. The Indian Banks Association has framed Ext.R1(b) Model Educational Loan Scheme for Pursuing Higher Education in India and Abroad, 2021. The 1^st respondent-Bank has issued Ext.R1(c) Master Circular dated 10.05.2021. The amounts can be released only in accordance with Exts.R1(a) and R1(b), contended the respondents.

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I have heard the counsel for the petitioner and the Standing Counsel for the respondents.

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The application of the petitioner for educational loan of ₹7,00,000/- was against the total medical course expenses of ₹29,58,036/-, for the period of study of six years. The petitioner would submit that the Tuition Fee for the first year is ₹2.57 lakhs and the petitioner would require another ₹2.85 lakhs for travelling expenses in the First Year itself.

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W.P.(C) No.21235/2021

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: 5 :

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The petitioner claims that the respondents shall disburse an amount of ₹5.42 lakhs out of the sanctioned ₹7 lakhs in the First Year itself.

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Clause 28 of the Terms and Conditions in Ext.P3 Letter of Sanction issued to the petitioner would indicate that the Bank will disburse the loan in stages as per the requirement / demand directly to the school / College / University / Hostel / Institution / Book Seller, to the extent possible. Ext.R1(b) Model Educational Loan Scheme for Pursuing Higher Education in India and Abroad, 2021 formulated by the IBA and followed by the 1^st respondentBank, provides that the Bank should ensure that a student is neither over financed or under financed. Therefore, the 1^st respondent will be justified in releasing the loan amount proportionately taking into account the requirement in each year.

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When the petitioner has himself to find resources for payment of ₹29,58,936/- minus ₹7,00,000/-, to meet the educational expenses, every year the petitioner has to raise

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W.P.(C) No.21235/2021

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: 6 :

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proportionate fee himself. The petitioner cannot insist that the entire amount of loan sanctioned should be released in the initial academic year/s itself. If that is allowed, it would amount to over financing. The prayer of the petitioner in that regard cannot be allowed.

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The petitioner submits that he has to remit the First Year fee immediately to the University in this month itself, failing which he may not be permitted to join the Course.

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In the circumstances, the writ petition is disposed of directing the 1^st respondent to release the eligible proportionate amount of fee to the petitioner immediately, without further delay.

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N. NAGARESH, JUDGE

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aks/09.12.2021

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Sd/-

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W.P.(C) No.21235/2021

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: 7 :

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APPENDIX OF WP(C) 21235/2021

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PETITIONER'S EXHIBITS

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Exhibit P1 THE TRUE COPY OF THE REJECTION ORDER DATED 16.06.2021. Exhibit P2 THE TRUE COPY OF THE JUDGMENT IN WP(C) NO.14912/2021 DATED 13.08.2021. Exhibit P3 THE TRUE COPY OF THE LOAN SANCTIONED LETTER ISSUED BY THE 1ST RESPONDENT DATED 09.09.2021. Exhibit P4 THE TRUE COPY OF THE GUIDELINES ISSUED BY THE RESERVE BANK OF INDIA, DATED 28.04.2001. Exhibit P5 THE TRUE COPY OF THE REQUEST 01.10.2021 TO R1. Exhibit P6 THE TRUE COPY OF THE TUITION FEE DETAILS ISSUED FROM THE UKRAINE MINISTRY OF EDUCATION AND SCIENCE OF UKRAINE.

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RESPONDENT'S EXTS:

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R1(a) COPY OF THE NOTIFICATION OF THE RESERVE BANK OF INDIA DT 28.4.2001.

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R1(b) COPY OF THE EDUCATION LOAN SCHEME FOR PURSUING HIGHER EDUCATION IN INDIA AND ABROAD 2021 FORMULATED BY THE INDIAN BANKS ASSOCIATION.

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R1(c) COPY OF THE MASTER CIRCULAR DATED 10.5.2021 ALONG WITH THE RELEVANT PAGES ISSUED BY THE 1ST RESPONDENT BANK.

Jimson Titus v. the Chief Manager

Case brief

What is this about?

What did the court decide?

Jimson Titus v. the Chief Manager

Case brief

What is this about?

What did the court decide?

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