Ramankol Rohit vs Union Of India
2025 Latest Caselaw 6812 Tel

Telangana High Court

Ramankol Rohit vs Union Of India on 1 December, 2025

Author: Nagesh Bheemapaka

Bench: Nagesh Bheemapaka

             HIGH COURT FOR THE STATE OF TELANGANA
                                AT HYDERABAD

       THE HON'BLE SRI JUSTICE NAGESH BHEEMAPAKA

                    WRIT PETITION No.28483 of 2025

                       DATE OF ORDER:- 01.12.2025

BETWEEN:

Ramankol Rohit

                                                                    ... Petitioners

      AND

Union of India represented by its
Secretary, Ministry of Finance, New Delhi
& 13 others
                                                                 ... Respondents

                                     ORDER

1. This Writ Petition is filed under Article 226 of the Constitution

of India seeking the following relief:-

".. ... ... to issue an appropriate Writ, Order or Direction more

particularly in the nature of Writ of Mandamus declaring the action of

respondent Nos.3 to 14 in attempting to recover amounts from the

petitioner as illegal and arbitrary and in violation of Reserve Bank of

India Circular bearing No.RBI/2022-23/108,

DOR.ORG.REC.65/21.04.158/2022-23 dated 12.08.2022 and further

declaring the inaction of respondent No.2 in enforcing the said circular

as unconstitutional and violative of Article 14, 19 & 21 of the Constitution

of India

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(b) direct the respondent authorities to refrain from undertaking any

coercive or unlawful recovery measures against the petitioner and to

strictly comply with the due process of law and the aforesaid circular in

all recovery proceedings and further restrain respondent Nos.3 to 14,

their agents, recovery agents, executives, managers, or any person

acting on their behalf from engaging in any acts of intimidation,

harassment, humiliation or intrusion into the privacy of the petitioner or

his family members, referees or friends, including persistent or

anonymous calls, threatening messages or physical visits to the

petitioner's premises;

(c) direct respondent No.2 to enforce the said RBI Circular in letter and

spirit and to initiate appropriate and stringent action against the errant

officials of respondent Nos.3 to 14 for violating legal norms and to

(d) direct respondent Nos.3 to 14 not to resort to any coercive measures

against the petitioner except through lawful means and in strict

adherence to the Circular dated 12.08.2022."

2. The case of the petitioner is that he availed personal loan from

respondent Nos.3 to 14, who are the private bankers and financial

institutions and utilized the amounts and he has been prompt in

repaying the same without fail. It is further case of the petitioner that

ever since he obtained loan, he had been regularly paying the

installments till July, 2025 and due to severe hardship which ruined

the financial stability, he could not pay the remaining installments. It

NBK,J WP_28483_2025

is also the case of the petitioner that respondent Nos.3 to 14 without

following the guidelines of RBI, has been sending the loan recovery

agents to his house and harassing to pay the amounts due as per

the calculation of respondents.

3. The grievance of the petitioner is that the respondents are

entitled to recover loan amount in terms of the loan agreements by

following the procedure established under law and they are not

having any right to recover the loan amount by using force.

4. The issues raised in this Writ Petition are no longer res integra

as the Hon'ble Supreme Court in ICICI Bank Ltd. vs.Prakash Kaur

and others 1, while dealing with the similar issues where the banks

engaged the services of recovery/collection agents to recover the

loans, observed as follows:-

"16. Before we part with this matter, we wish to make it clear that we do not appreciate the procedure adopted by the Bank in 1 (2007) 2 SCC 711 3 CVBR, J Wp_5200_2024 removing the vehicle from the possession of the writ petitioner. The practice of hiring recovery agents, who are musclemen, is deprecated and needs to be discouraged. The Bank should resort to procedure recognised by law to take possession of vehicles in cases where the borrower may have committed default in payment of the instalments instead of taking resort to strong-arm tactics."

(2007) 2 SCC 711

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5. Aggressive recovery tactics adopted by the agents of

Banks/Financial Institutions lead to the landmark judgment in ICICI

Bank vs. Shanti Devi Sharma and others 2 , where the Hon'ble

Supreme Court directed the Banks/Financial Institutions to strictly

follow the guidelines issued by the Reserve Bank of India.

6. In the above referred judgments, the Hon'ble Supreme Court

condemned the procedure adopted by the Banks/Financial

Institutions in employing recovery agents who are acting as

middlemen for securing possession of vehicles/secured assets in

cases where the borrower commits default. It was observed that

Banks/Financial Institutions instead of taking recourse to follow the

procedure recognized by law for securing the possession of

vehicles/secured assets in cases where the borrower commits

default in repayment of loan/loan account is declared as NPA, are

resorting to strong arm tactics. The Hon'ble Supreme Court

delineated the guidelines issued by the Reserve Bank of India time

and again on the fair conduct by lenders, with reference to usage of

services of recovery agents. It also stated that the banks should be

reminded of the rule of law and strict action must be taken by the

RBI in case of breach of such guidelines.

(2008) 7 SCC 532

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7. It is apt and appropriate to extract latest guidelines issued by

the Reserve Bank of India on 12.08.2022 with regard to outsourcing

of Financial Services Responsibilities of regulated entitites

employing recovery agents, which reads as follows:

"RBI/2022-23/108

DOR.ORG.REC.65/21.04.158/2022-23

August 12, 2022

Madam/ Sir,

Outsourcing of Financial Services - Responsibilities of regulated entities employing Recovery Agents

The Reserve Bank of India has from time to time advised regulated entities (REs) that the ultimate responsibility for their outsourced activities vests with them and they are, therefore, responsible for the actions of their service providers including Recovery Agents (hereafter referred to as 'agents').

2. It has been observed that the agents employed by REs have been deviating from the extant instructions governing the outsourcing of financial services. In view of concerns arising from the activities of these agents, it is advised that the REs shall strictly ensure that they or their agents do not resort to intimidation or harassment of any kind, either verbal or physical, against any person in their debt collection efforts, including acts intended to humiliate publicly or intrude upon the privacy of the debtors' family members, referees and friends, sending inappropriate messages either on mobile or through social media, making threatening and/or anonymous calls, persistently calling the borrower and/or calling the borrower before 8:00 a.m. and after 7:00 p.m. for recovery of overdue loans, making false and misleading representations, etc.

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3. The instructions contained in Para 2 above shall supplement and be read in conjunction with the existing guidelines/directions issued by the Reserve Bank of India, as amended from time to time, including those tabulated in Annex.

4. Any violation in this regard by REs will be viewed seriously.

Applicability

5. This circular shall apply to the following REs:

(a) All Commercial Banks (including Local Area Banks, Regional Rural Banks, and Small Finance Banks) excluding Payments Banks;

(b) All All-India Financial Institutions (viz. Exim Bank, NABARD, NHB, SIDBI, and NaBFID);

(c) All Non-Banking Financial Companies including Housing Finance

Companies;

(d) All Primary (Urban) Co-operative Banks, State Co-operative Banks, and District Central Co-operative Banks; and

(e) All Asset Reconstruction Companies.

6. This circular shall not apply to microfinance loans covered under 'Master Direction - Reserve Bank of India (Regulatory Framework for Microfinance Loans) Directions, 2022', dated March 14, 2022.

Yours faithfully,

(Sunil T. S. Nair)

Chief General Manager"

8. For the aforesaid reasons and as the procedure adopted by

the respondent Nos.3 to 14 for recovery of loan amount from the

petitioner, amounts to violation of the rights guaranteed under

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Articles 14 and 21 of the Constitution of India, this Court deems it

appropriate to direct the respondents, to ensure that the agents

engaged by them for recovery of the loan amounts, shall strictly

follow the guidelines and instructions issued by the Reserve Bank of

India and also the judgments of the Hon'ble Supreme Court in ICICI

Bank Ltd. vs.Prakash Kaur's case (1 supra) and ICICI Bank

vs.Shanti Devi Sharma's case (2 supra).

9. With the above direction, the Writ Petition is disposed of.

There shall be no order as to costs.

10. Miscellaneous petitions pending, if any, shall stand closed.

______________________________ JUSTICE NAGESH BHEEMAPAKA Dt.01.12.2025 ysk

NBK,J WP_28483_2025

THE HON'BLE SRI JUSTICE NAGESH BHEEMAPAKA

WRIT PETITION No.28483 of 2025

Dt.01.12.2025 ysk