A single judge bench of the Madras High Court comprising of Justice S.M. Subramaniam while entertaining a writ petitioner against the IDBI Bank for withholding the original documents of the petitioner even when the loan dues were cleared, held that it is needless to state that once, the loan dues are cleared by the borrower, the Banks are not expected to keep the original documents with them and it is to be released without any condition.
Brief Facts:
A dispute regarding the waiver of foreclosure charges was pending before the High Court in a writ proceeding. At that time, the 2nd respondent/IDBI Bank expressed its inability to consider the request of the petitioner to return the original documents deposited by the petitioner, while borrowing the loan. The documents were requested by the petitioner from the bank for the pending case. Aggrieved by the conduct of the 2nd respondent/IDBI Bank, the petitioner filed this writ petition to quash the communication issued by the 2nd respondent/IDBI Bank dated 28.09.2017.
Contentions of the Petitioner:
The learned counsel for the writ petitioner made a submission that the conduct of the respondent/Bank in not returning his original documents, despite the consent given by the petitioner to recover the foreclosure charges is arbitrary. The pertinent question raised by the petitioner was that the entire loan dues were cleared and while so, the respondent/IDBI Bank had no authority to keep the original documents with them merely on the ground that writ proceedings were pending before the High Court. The learned counsel for the petitioner reiterated that the conduct of the respondents/Bank in this regard is not only arbitrary, but it would also affect the very genuine of the Banking transactions.
Contentions of the Respondent:
The respondent submitted that pursuant to the interim order passed by this Court, all the original documents were already returned back to the petitioner and thus, the writ petition became infructuous. Admittedly, the documents were returned back to the petitioner, which was acknowledged by the petitioner. That being the case, no further adjudication needs to be undertaken in respect of the grounds raised in the present writ petition.
Observations of the Court:
Firstly, the court observed that regarding the misconduct or otherwise on the part of the Bank, the petitioner was at liberty to approach the appropriate authority or Forum for the purpose of redressing his grievances or to ensure that the Banks Act in accordance with the provisions of the Statutes and Rules and within their limits. Further, the court observed that it is needless to state that once, the loan dues are cleared by the borrower, the Banks are not expected to keep the original documents with them and it is to be released without any condition. However, in the present case, the impugned order by the bank said that the writ petition was subjudiced and therefore, they will not release the documents. As per the court, having received the entire loan amount, the stand taken by the bank in this regard seemed to be improper in the eyes of law.
The decision of the Court:
The writ petition was dismissed with the aforementioned order.
Case Title: S. Manoharan vs The IDBI Bank Ltd. and another
Coram: Justice S.M. Subramaniam
Case No.: W.P. No.27815 of 2017
Advocate for the Petitioner: Mr. Niranjan Rajagopalan
Advocate for the Respondents: Mr. P. Elaya Rajkumar
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