Friday, May 16, 2008

‘Don’t use goons for loan recovery’

Maintaining that India is a civilised country governed by the rule of law, the Supreme Court has said that banks cannot deploy musclemen to recover loans from defaulters and often forcing them to commit suicide.

A Bench of justices Tarun Chatterjee and Dalveer Bhandari dismissed the ICICI Bank’s plea to expunge remarks of the Delhi High Court that said the bank and its musclemen were responsible for abetting a youth to commit suicide by humiliating him and taking away his motorcycle financed by it.

"The modus operandi employed by banks like ICICI for realisation of their loan amount and for recovering the possession of the vehicle against which loans are given, is extra legal and by no stretch of imagination they can be permitted to employ musclemen and goons, for recovery of their dues even from a defaulting party," the HC had said.

The HC order had come on a petition filed by Shanti Devi seeking a probe against the ICICI bank and its staff for the unlawful action that led to the suicide of her 34-year-old son Himanshu Dev Sharma.

Sharma had committed suicide in October 2005 by hanging himself at his house after he was allegedly intimidated and humiliated in front of his neighbours and family by recovery agents of the bank.

The ICICI Bank had contended that it was within its rights to recover loans and had followed the required procedure for recovering dues.

However, not convinced with the bank’s contention, the Supreme Court directed the Delhi Police to conclude the
investigation against the bank expeditiously within three months, keeping in view the gravity of the allegations. It directed the concerned Deputy Commissioner of Police to submit the investigation report in the Delhi High Court.

The court also asked the ICICI Bank to pay Rs 25,000 as cost of litigation to Sharma’s mother in three weeks.

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