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Informist, Thursday, May 21, 2026

 

NEW DELHI – The Supreme Court has observed that banks such as State Bank of India are casual in granting loans of huge amounts to big entities but at the same time, are very demanding on giving small loans to ordinary people, who seek money for personal requirements. Subjecting ordinary people to more stringent conditions and a tedious process might amount to borderline harassment in certain cases, said a bench of Justice Ahsanuddin Amanullah and Justice R. Mahadevan.

 

Expressing its displeasure at this, the top court said it would leave the issue for a more fit case where specific orders may be called for against such practices of banks in general, including State Bank of India. The top court said a policy needs to be suitably framed by the government with respect to concessions or incentives in giving loans to ordinary people so as to give the maximum benefit to those at the lowest rung of the social or financial strata. The top court asked the counsel appearing for SBI to convey the bench's opinion to the bank at the appropriate level. However, it was in no way suggesting easing of norms and requirements for loan facilities, which was best left to the Reserve Bank of India and the banks concerned, but the procedure so adopted could certainly be made easier and fairer for loan seekers or applicants and thereafter at the stage of recovery also, said the court.

 

The Supreme Court said there has been negligence on the part of State Bank of India and its officials in granting a huge loan of INR 80.90 million to the petitioner Bhaskar International Pvt. Ltd. as the company could not even start repaying and defaulted at the very first instance. Tentatively, this is a clear indicator that a proper assessment was not made of the capacity of the petitioner to repay the loan by officials concerned of SBI, said the court.

 

However, the apex court refused to interfere with an execution decree filed by State Bank of India for taking over the possession of the properties of Bhaskar International for failing to repay the loan. It allowed the petitioner Bhaskar International to press their prayer for interim relief before the Debts Recovery Tribunal regarding the properties. The apex court directed status quo to be maintained on the petitioner's properties for two weeks till the company filed its interim relief plea in the tribunal.  

 

The top court said the petitioner had defaulted on the very first instalment of paying its loan of INR 80.90 million to the bank and ever since, habdn't repaid even a single farthing. The offer to repay the principal amount in 2025 by the petitioner, after about six years of availing the loan facility, was too little too late, said the apex court.

 

The case has its genesis in Bhaskar International availing the loan from SBI in 2019. However, due to non-payment of any instalment, after about five to six months, the company's account was declared a non-performing asset. Thereafter, SBI sought to take possession of the immovable properties belonging to Bhaskar International and filed an application under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. 

 

At 1304 IST, shares of State Bank of India were down 0.3% at INR 948.10 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Avishek Dutta

 

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