2013 (10) TMI 1560

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....ce the names of the petitioners on the list of wilful defaulters and advising the petitioners that a representation could be made by them to the Grievance Redressal Committee of the bank. The petitioners issued a reply on February 2, 2013 questioning the basis of the formation of the initial opinion. Thereafter, the bank gave several opportunities to the petitioners to be represented before the Grievance Redressal Committee which the petitioners did not avail of. The Grievance Redressal Committee, by its order communicated to the petitioners on May 27, 2013 rejected the petitioners' representation. The petitioners refer to clauses 3(i) and 3(ii) of the relevant Master Circular and contend that it would be evident from the minutes of the me....

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....parent before a borrower is qualified as a wilful defaulter. The consequences of a person being labelled as a wilful defaulter are serious as it, willy-nilly, leads to the commercial ostracisation of the borrower in the sense that credit facilities would no longer be available to such borrower. In such circumstances, the distinction between a person unable to pay and a wilful defaulter as maintained in the Master Circular must be appreciated and the procedure as laid down, inter alia, in Clause 3 of the Master Circular should be strictly adhered to before a borrower is branded as a wilful defaulter. In this case, there does not appear to be any application of mind by the initial committee of the bank, far less any reference to any materia....