Perambalur: Madan, 32, a resident of Kulothunganallur, Ariyalur district and working Armed Reserve Police, Ariyalur, secured an education loan of Rs 8.40 lakh from Indian Bank, Meensuruti between 2011 and 2014 by mortgaging his property to study marine engineering.

Madan joined the police force in 2017.

In 2022, Indian Bank issued him a notice demanding a balance payment of Rs 18.98 lakh within a week. Madan approached the Chennai Debt Collection Tribunal, which ordered him to pay 20% of the outstanding amount.

Following the tribunal's order, Madan paid Rs 3.87 lakh to the bank. Despite this, Indian Bank filed a lawsuit against him in the Ariyalur District Court for Rs 18.28 lakh. While the case was pending, the bank issued another notice to auction his mortgaged property without a court order. Fearing the auction, Madan redeemed the mortgaged property by paying Rs 19.41 lakh in four installments.

In January 2024, Madan filed a case against Indian Bank in the Ariyalur District Consumer Court. Tamilselvi, Consumer Commission Chairman and members Balu and Lavanya delivered the verdict yesterday.

The court found that Indian Bank had not followed the Reserve Bank guidelines in recovering the education loan, had revised the repayment period improperly, and had charged an excessive interest rate of 15%.

Consequently, the court ordered Indian Bank to pay a fine of Rs 15 lakh and Rs 10 thousand as legal costs within two months for the unlawfully recovered loan amount.