Kerala High Court
Jimson Titus vs The Chief Manager on 11 January, 2022
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
TUESDAY, THE 11TH DAY OF JANUARY 2022 / 21ST POUSHA, 1943
WA NO. 35 OF 2022
AGAINST THE JUDGMENT IN WP(C) 21235/2021 OF HIGH COURT OF KERALA
APPELLANT/WRIT PETITIONER:
JIMSON TITUS
AGED 20 YEARS, S/O.TITUS, THANNIPPILLY HOUSE,
NADATHARA P.O., MINOR ROAD, PIN - 680 751.
BY ADVS.
SHERRY J. THOMAS
JOEMON ANTONY
RESPONDENTS/RESPONDENTS:
1 THE CHIEF MANAGER
BANK OF BARODA, THRISSUR BRANCH,
THIRUVAMBADY DEVASWOM BUILDING, ROUND WEST,
THRISSUR, KERALA - 680 001.
2 THE GENERAL MANAGER,
RESERVE BANK OF INDIA, REGIONAL OFFICE,
BANJERI ROAD, ERNAKULAM NORTH, KALOOR,
ERNAKULAM - 682 018.
SRI. NAGARAJ NARAYANAN, SC FOR R1
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 11.01.2022,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
W.A.No.35 of 2022
2
JUDGMENT
Dated this the 11th day of January, 2022
S.Manikumar, C.J.
Before the writ court, the petitioner/appellant has sought
for the following reliefs:
"i) Issue a Writ of Mandamus or any other Writ, order
directing to the 1st Respondent to disburse the amount
sanctioned as per Ext P3 in accordance with the
requirement of course fee as scheduled Para 5.3 of Ext P4
Scheme, forthwith.
ii) Issue a Writ of Mandamus or any other Writ, order
directing to the 1st Respondent to consider Ext P 5 and
disburse Rs. 2.57 lakhs of 1st year fee and 2.85 lakhs as
travelling expenses to the petitioners account forthwith.
iii) Issue a Writ, order or Direction, declaring that pro-rata
basis of loan disbursal shall be in accordance with the
yearly expenses for the course."
2. After considering the rival submissions, writ court
held as under:
"7. 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
W.A.No.35 of 2022
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. 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.
8. 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 1st
respondentBank, provides that the Bank should ensure
that a student is neither over financed or under financed.
Therefore, the 1st respondent will be justified in releasing
the loan amount proportionately taking into account the
requirement in each year.
9. 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 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."
Being aggrieved, instant writ appeal is filed.
W.A.No.35 of 2022
3. Short facts leading to the filing of the appeal are as
hereunder:
The appellant, along with his parents as co-applicants,
applied for Baroda Education loan at 1st respondent Bank
for his MBBS in Petro Mohyla Black Sea National
University, at Ukraine. The total estimated cost of
education is Rs. 29,58,936/-, but the appellant required
only Rs.7 lakhs, that too, for the first two years.
Subsequent to the interventions of this Hon'ble Court, the
1st respondent sanctioned the education loan of Rs.7
lakhs.
Though the loan is sanctioned, the 1st respondent is not
disbursing the amount to the account. They orally
intimated that only an amount of Rs. 1.16 lakhs will be
disbursed as 1/6th of the total loan amount. The
contention of the bank is that the pro-rata basis disbursal
is calculated by dividing total amount and actual years of
course. Against which, the petitioner preferred a petition
to the bank requesting to sanction the 1st year fee amount
in accordance with the fees structure of the College (First
year Fee amount of Rs. 2.57 lakhs and Rs. 2.85 lakhs as
travelling expenses) and also in accordance with the
guidelines issued by the Reserve Bank of India.
W.A.No.35 of 2022
The Exhibit P4 guidelines of RBI points out the objectives
of the educational loan scheme. It is stated that the
object of the scheme itself is to provide financial support
from the banking system to meritorious students for
pursuing higher education in India and abroad. The
guideline Nos. 5.2 and 5.3 dealt with the studies of
abroad. The quantum of finance is also mentioned in the
above said model scheme. While assessing the quantum
of finance, banks should ensure that a student is neither
over financed nor under financed. The terms and
conditions - No. 28 also confirms that the loan will be
disbursed in stages as per the requirement directly to the
college. When challenged, the writ court is of the view
that the proportionate amount - loan amount/number of
years of course can only be disbursed. This is against the
guidelines issued by the Reserve Bank of India.
4. Though Mr.Sherry J. Thomas, learned counsel for the
appellant, made submissions on the grounds raised and also
invited the attention of this court to the guidelines issued by
the Reserve Bank of India, perusal of the same shows that the
guidelines only enable the appellant to seek for loan under
various heads and it is for the bank to consider.
W.A.No.35 of 2022
5. Clause 5.3 of the guidelines - expenses considered for
loan, reads as under:
"5.3. Expenses considered for loan
i. Fee payable to college ++/hostel.
ii. Examination/Library/Laboratory fee.
iii. Travel expenses/passage money for studies abroad.
iv. Insurance premium for student borrower.
v. Caution deposit, Building fund/refundable deposit
supported by Institution bills/receipts.
vi. Purchase of books/equipment/instruments/Purchase
of computer at reasonable cost, if required for
completion of the course.
viii. Any other expenses required to the Course - like
academic and maintenance fees, study tours, project
work, thesis, exchange programme, etc.
ix. While computing loan required, scholarships, fee
waiver etc. if any available to the student borrower
while applying for the loan may be taken into
consideration.
x. If the scholarship component is included in the loan
assessment, it may be ensured that the scholarship
amount gets credited to the loan account when
received from the government."
6. Material on record discloses that the total expenses
for pursuing the course in Petro Mohyla Black Sea National
W.A.No.35 of 2022
University at Ukraine is Rs.29.58 lakhs. Appellant has sought
for a loan of Rs.7,00,000/-. Expenses claimed as detailed in
paragraph 12 of the counter affidavit is reproduced:
1st 2nd 3rd 4th 5th 6th Total USD/ AMOUNT
Year Year Year Year Year Year INR IN RS.
TUITION FEE 3800 3800 3800 4100 4100 4100 23700 72.44 1716828
ACCOMMODATION 700 700 700 700 700 700 4200 72.44 304248
FOOD EXP. 1500 1500 1500 1500 1500 1500 9000 72.44 651960
EXPENSES IN INDIA 285000
TOTAL 2958036
7. Other than the above heads, no other claim has been
made. That apart, in the counter affidavit, respondent Bank
has also stated that the said amount of Rs.7,00,000/- has to be
paid for the entire period of study on pro-rata basis.
Averments in paragraph 8 of the counter affidavit on the said
aspect is reproduced:
"8. The averment of the petitioner in paragraph 4 of the
writ petition that the calculation for disbursement of loan
account on pro-rata basis by the respondent bank is against
the principles of justice and guidelines of the RBI is
baseless, untenable and devoid of any merit. Pro-rata
essentailly translates to "in proportion", which means a
process where whatever is being allocates will be
distributed in equal portions for each year. Hence, in the
case of the petitioner, an amount of 7 lakhs is sanctioned
to the petitioner for the period of study of 6 years, then
the proportionate pro-rata basis of loan amount
W.A.No.35 of 2022
disbursement per year to the 1st petitioner will be Rs.1.16
lakhs, per year for the 6 year period."
8. On the aspect of pro-rata payment, this court, in
W.A.No.1281 of 2021 dated 12.10.2021, has upheld the
contention of the Bank and accordingly issued orders. For
reference, paragraphs 4 to 6 of the judgment in W.A.No.1281
of 2021 dated 12.10.2021 is reproduced:
"4. As the first year fee has already been paid by
the student, appellant/Bank is directed to pay
Rs.1,40,000/- to the respondent/student, within ten days
from the date of receipt of a copy of this judgment.
5. As fee for the second years is due, bank is
directed to disburse the second year fee/second
instalment of loan of Rs.1,40,000/- to the educational
institution/Poomulli Neelakandan Namboothiripad
Memorial Ayurveda Medical College, Shornur,
immediately. Rest of the loan amount shall be remitted
to the above institution as per the schedule, namely 3rd
year-Rs.1,40,000/-, 4th year-Rs.1,40,000/-, 5th year-
Rs.1,40,000/-.
6. It is made clear that the affidavit of undertaking
dated 9.10.2021 regarding repayment should be
complied with, without any fail. In the event of any failure
to comply with the undertaking in letter and spirit, the
appellant Bank is at liberty to take appropriate action
W.A.No.35 of 2022
under the Scheme."
Giving due consideration to the material on record, we
find no error in the impugned judgment, warranting
interference. Accordingly, writ appeal is dismissed.
Pending interlocutory applications, if any, shall stand
closed.
Sd/-
S.Manikumar
Chief Justice
Sd/-
Shaji P.Chaly
Judge
vpv
//true copy//
P.A. to Judge
