Petitioner sought mandamus for refund of pre-closure charges. Court held the Banking Ombudsman is the appropriate authority. Writ dismissed but liberty granted to approach Ombudsman.
Nov 11, 2013 post-dated bill along with interest. Petitioner is directed to approach RBI Ombudsman.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
W.P.No.13380 of 2013
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 07.02.2023
CORAM :
THE HONOURABLE DR.JUSTICE ANITA SUMANTH
W.P.No.13380 of 2013
Precision Controls, A firm represented by its Managing Partner, S.Shankar, S/o.Late Srinivasan, residence at No.5-A, “D” Silva Road, Mylapore, Chennai – 600 004.
.. Petitioner
vs
1.The State Bank of India Rep. By its General Manager, Network – 1, Local Head Office Circle Top House, 16, College Road, Chennai – 6.
Petition filed under Article 226 of the Constitution of India praying to issue a writ of mandamus directing respondent nos. 1 and 2 to refund an amount of Rs.11,59,696/- (Eleven lakhs fifty nine thousand six hundred and ninety six only) which was debited from the petitioner's account No : 00000030041035089 on 26.03.2013 as preclosure charges towards term loan accounts TL a/c : 31044346131,30250054070,31861316550, 31279888779 with interest at 18.1% p.a. from 26.03.2013 till date of repayment.
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| For Petitioner | : | Mr.R.Srinivas |
|---|---|---|
| For Respondents | : | Mr.Ilayaraja for M/s.Ramalingam & Assoc. for R1,R2 |
| Mr.C.Mohan for M/s.King and Patridge for RBI Ombudsman |
ORDER
The petitioner, a partnership firm, seeks a mandamus directing the State Bank of India, R1 and R2 to refund the amount of Rs.11.59 lakhs (approx) that was debited from his account bearing No. 00000030041035089 on 26.03.2013 as charges towards pre-closure of term loan accounts bearing numbers 31044346131, 30250054070, 31861316550 and 31279888779. There is a further prayer for interest at the rate of 18.1 percent per annum from 26.03.2011, which is the date of debit till date of repayment.
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take private notice on the learned panel counsel for the Reserve Bank of India / Ombudsman.
“Pre-payment charges (other than 'P' Segment) – 2% of the pre-paid amount (loans prepaid from own resources will not attract prepayment / pre closure charges).”
According to him, the transaction qua the petitioner
and the Bank is bound by the aforesaid specific clause and would attract no charges.
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to be issued. However, liberty is granted to the petitioner to make a complaint before the Ombudsman of the Reserve Bank of India in terms of the Reserve Bank Integrated Ombudsman Scheme, 2021 within a period of four weeks from the date of receipt of this order. The petitioner is at liberty to rely upon the guidelines issued by the State Bank of India, therein. If the complaint is filed within the period as indicated aforesaid, the petitioner as well as the appropriate authority in the State Bank of India shall be called on by issue of notice, heard and an order be passed on the complaint within a period of four weeks from the date of such personal hearing.
costs.
07.02.2023
Index:Yes/No Neutral Citation:Yes ssm
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W.P.No.13380 of 2013
To
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W.P.No.13380 of 2013
DR. ANITA SUMANTH,J.
ssm
W.P.No.13380 of 2013
07.02.2023
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2 issues framed by the court
Whether the High Court can issue a writ of mandamus directing a bank to refund pre-closure charges.
Whether the matter falls within the jurisdiction of the Banking Ombudsman.
Precision Controls, A firm
The State Bank of India, Rep. By its General Manager
The State Bank of India, Ekkaduthangal Branch
Anita Sumanth
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
