No force, recovery of bank loans only through legal means, says SC

The Bench was hearing an appeal filed by India’s largest private bank, ICICI, against an Allahabad High Court order, rejecting its plea to quash the criminal cases registered by the Uttar Pradesh Government against the managing director and other top officials for allegedly using criminal force against a loan defaulter. The case was registered at the instance of the High Court there on a complainant from an owner that the bank had sent musclemen to seize the vehicle for non-payment of loan instalments.

Coming down heavily on the recent trend of hiring musclemen and employing goondas for making recoveries at times, even forcibly taking away vehicles purchased on loans, it said: “We will have to stop this practice.”

As the submissions put forth by the senior advocate Mukul Rohtagi, appearing for the bank failed to impress the Judges, he asked the Court to lay down certain guidelines. Meanwhile, it asked RBI and Indian Bank Association for guidelines issued on this subject to be placed before the court before the next date of hearing.