Dismissed

Neville Xavier v. the Regional Manager, State Bank of India

Kerala HC2 Nov 2022WP(C)/12728/2021

Case brief

AI extract

What is this about?

Petitioners challenged rejection of an educational loan due to low CIBIL score, alleging State Bank of India failed to update score after settling a prior loan. Court dismissed petition, citing bank procedures and CR Act regulations, allowing re-application with fresh surety.

What did the court decide?

Petition dismissed; petitioners directed to approach Bank again if advised with fresh surety.

Neville Xavier Vs the Regional Manager, State Bank of… — Banking and Recovery | Kerala HC (2022)

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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 V.G.ARUN

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WEDNESDAY, THE 2^ND DAY OF NOVEMBER 2022 / 11TH KARTHIKA, 1944

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WP(C) NO. 12728 OF 2021

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PETITIONERS:

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1 NEVILLE XAVIER, AGED 29 YEARS S/O. JUSTIN, MOOLAMKUZHI HOUSE, KODANTHURUTHU, KUTHIYATHOD P.O, CHERTHALA, ALAPPUZHA 688 533

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2 JUSTIN M.V MOOLAMKUZHI HOUSE, KODANTHURUTHU, KUTHIYATHOD P.O, CHERTHALA, ALAPPUZHA 688 533

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BY ADV K.MOHANAKANNAN

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RESPONDENTS:

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1 THE REGIONAL MANAGER, STATE BANK OF INDIA STATE BANK OF INDIA, NH 47, KALARCODE, THOOKUKULAM, ALAPPUZHA, KERALA 688 003

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2 THE CHIEF MANAGER STATE BANK OF INDIA, SOUTH KUTHIYATHODU BRANCH, ALAPPUZHA DISTRICT 688 533

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3 THE BRANCH MANAGER STATE BANK OF INDIA, KUTHIYATHODU BRANCH, ALAPPUZHA DISTRICT 688 533

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ADDL.R4 MANAGING DIRECTOR/CHIEF EXECUTIVE OFFICER OF CIBIL, ONE WORLD CENTRE, TOWER 2A, 19TH FLOOR, SENAPATI BAPAT MARG, ELPHINSTONE ROAD, MUMBAI-400 013.

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ADDL.R5 RESERVE BANK OF INDIA,

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18TH FLOOR, CENTRAL OFFICE BUILDING SHAHID BHAGAT SINGH ROAD, MUMBAI-400 001, REPRESENTED BY ITS CHAIRMAN

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ADDL.R4 AND R5 ARE IMPLEADED AS PER ORDER DATED 02.08.2021 IN I.A.1/2021 IN WP(C)12728/2021

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BY ADVS.

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R1 TO R3 BY ADV.K.K.CHANDRAN PILLAI (SR.)

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W.P.(C). 12728/2021

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S.AMBILY ADDL.R4 BY ADV. C.AJITH KUMAR

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 02.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C). 12728/2021

JUDGMENT

Dated this the 2^nd day of November, 2022

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The petitioners' grievance is that, despite the petitioners settling the loan availed from the State Bank of India, the application submitted by the 2^nd petitioner for educational loan is rejected by the Punjab National Bank. The reason stated is that the 1^st petitioner's CIBIL score is less than the required limit. According to the petitioners, the earlier loan account having been settled, the SBI was bound to intimate the 4^th respondent about that fact and ensure an appropriate revision of the CIBIL score.

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Learned Standing Counsel appearing for the Bank referred to Ext. P8 account details of the 1^st petitioner which reflects that the 1^st petitioner's loan account was 'written off' and status is still in doubtful debts. It is submitted that 'written off' status will be reflected when the Bank sacrifices certain amount for the purpose of closing the loan. In such

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W.P.(C). 12728/2021

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cases, the Bank will not request for improving the borrower's CIBIL score.

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Adv. C. Ajith Kumar, learned Counsel appearing for the 4^th respondent submits that the 4^th respondent can act only in terms of the information passed on by the Bank. In the instant case, the account being written off, the 4^th respondent cannot improve the CIBIL score of the 1^st petitioner without the Bank giving specific instruction in that regard. As a matter of fact, the Bank had, vide communication dated 02.11.2021, informed that the account had been settled by the Bank incurring a loss and the account holder having failed to compensate the loss, no improvement of the CIBIL score is warranted.

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The learned Counsel for the petitioners thereupon submitted that the Bank may at least be directed to reconsider the application. I am not inclined to pass any such order, since that would not improve the situation. As rightly pointed out by the learned Senior Counsel, the procedure with

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W.P.(C). 12728/2021

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respect to CIBIL rating of account holders is governed by the Credit Information Companies (Regulation) Act, 2005, the Rules of 2006 and Regulations of 2006.

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The writ petition is hence dismissed, without prejudice to

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the petitioners' right to approach the Bank again if so advised with a fresh surety.

Sd/-

V.G.ARUN

JUDGE

W.P.(C). 12728/2021

APPENDIX

PETITIONERS' EXTS:

EXT. P1 : TRUE COPUY OF THE LOAN CLOSURE LETTER ISSUED BY THE 3RD RESPONDENT DATED 2.3.2017.

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EXT. P2 : TRUE COPY OF THE RECEIPT ISSUED BY THE VILLAGE OFFICER, KODANTHURUTH DATED 27.3.2017.

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EXT. P3 : TRUE COPY OF THE COMMUNICATION GIVEN BY THE PUNJAB NATIONAL BANK DATED 17.12.2020.

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EXT. P4 : TRUE COPY OF THE REPRESENTATION SUBMITTED BY THE 2ND PETITIONER BEFORE THE 3RD RESPONDENT DATED 19.1.2021.

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EXT. P5 : TRUE COPY OF THE REPRESENTATION DETAILING THE VARIOUS PAYMENTS EFFECTGED BY REPRESENTATION DATED 15.2.2021.

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EXT. P6 : TRUE COPY OF THE LAWYER NOTICE TO THE 1ST RESPONDENT ON 18.3.2021.

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EXT.P7 : TRUE COPY OF THE STDATEMENT OF ACCOUNT FROM 9.10.2010 TO 29.9.2016.

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EXT. P8: TRUE COPY OF THE RELEVANT PAGES OF THE CIBIL SCORE REPORT DATED 19.1.2021.

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EXT. P9 : TRUE COPY OF THE COMMUNICATION SENT BY THE 3RD RESPONDENT TO THE PETITIONER DATED 29.3.2021.

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EXT. P10: TRUE COPY OF THE STATEMENT OF ACCOUNTS FROM JANUARY, 2016 TO FEBRUARY, 2021.

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EXT. P11: TRUE COPY OF THE COMMUNICATION SENT BY THE BANKING OMBUDSMAN TO THE 1ST PETITIONER DATED 4.5.2021.

Neville Xavier v. the Regional Manager, State Bank of India

Case brief

What is this about?

What did the court decide?

Neville Xavier v. the Regional Manager, State Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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