TN: HC orders bank to provide education loan to student

August 13, 2013

Exercising its suo motu powers, on August 4, the Madras High Court bench directed City Union Bank to provide educational loan to a student within 10 days and slapped a fine of Rs 10,000 on it for earlier rejecting her loan application and also not communicating it to her.

Justice N Kirubakaran, allowing a petition by K. Lakshmi Priyadarshini, who had sought a loan to pursue her B.E. course at a college in Chennai, noted that the February 26 rejection order had not been communicated to her and directed that the fine amount be given to Chief Justice Relief Fund.

Counsel for the bank’s Nagercoil Branch, produced the communication stating why her loan application was not considered, as she had secured only 69 percent marks instead of the cut -off marks of 85 percent fixed by it.

“This letter has not been addressed to the petitioner nor has a copy been communicated to her. The bank, after having received the order from the head office, cannot keep the rejection of the petitioner’s claim and make the petitioner come to this court. This act of the respondent is deprecated and condemned,” said Justice Kirubakaran.

On the argument of the bank’s counsel that the bank may fix the cut off marks under educational loan scheme, the Judge said the provision did not mean that it could fix very high percentage and deny education loans to candidates.

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