Banks can recover loan dues from debtor's savings account: Madras High Court
If a debtor failed to settle the loan dues despite reminders from the bank, then the money could be recovered from his savings bank account, ruled the Madras High Court bench in Madurai on Saturday.
Justice M Venugopal dismissed a written petition filed by a retired Tamil Nadu Electricity Board employee, who sought to restrain a nationalised bank from recovering the farm loan dues from his pension amount in the savings bank account.
The court observed that the bank was right in recovering the due amount from his savings bank account as per the mandate given by him at the time of availing the loan.
The petitioner and his son had jointly availed Rs 75,000 as farm loan from the bank in October, 2012, agreeing to repay it in 10 monthly instalments from April, 2015, after the holiday period of two years.
The judge said since they failed to repay the loan despite several reminders and only after it became a Non-Performing Asset, the bank was constrained to explore the possibility of recovering the amount as per loan agreement.
It was the duty of the petitioner and his son to repay the loan instalments and they could not wriggle out of the situation, the judge said.