SBI Refuses To Issue No-Dues Certificate For A Pending Amount Of 31 Paisa! High Court Slams SBI

The country’s largest lender, State Bank of India (SBI) has been slammed by the Gujarat High Court for giving bad treatment to their customers. There have many instances of such incidents. This time around, SBI has been slammed for not issuing a no-dues certificate to a farmer for a nominal pending amount of just 31 paise.

While hearing a petition moved by two farmers seeking relief from the high court, Justice Bhargav Karia expressed sheer displeasure over the bank withholding the no-dues certificate which was needed for clearing a land deal.

Nothing But Harassment : Justice Karia

According to the news agency PTI, Justice Karia said while hearing the matter that “This was nothing but harassment. This is too much. A nationalized bank says that a no-dues certificate will not be issued just for 31 paise,”

These observations were made by the Gujarat High Court, while responding to an appeal by the petitioners – Rakesh Verma and Manoj Verma – who had purchased a piece of land in Khoraj village near Ahmedabad city from farmer Shamjibhai and his family in 2020.

The Incident

Because of the bank’s pending charge on the land parcel, the petitioners (who are new owners of the land) could not enter their names in the revenue records. 

Since Shamjibhai had sold the land to the petitioners before repaying a crop loan of Rs 3 lakh, which he had taken from the SBI.

Even after repaying the entire amount to the bank, for some reason the bank was not issuing a no dues certificate. Post this, the new owners moved to the high court two years ago.

During the hearing on Wednesday, Justice Karia asked the bank to submit the no-dues certificate in court. Replying to the court, SBI’s lawyer Anand Gogia said, “It’s not possible because there is an outstanding amount of 31 paise. It is system generated.”

To this, Justice Karia said anything less than 50 paise should be ignored and the certificate should be issued because the original borrower had already paid the entire due on the crop loan.

After Gogia told the court that the SBI manager had verbally said that the certificate cannot be issued, the judge got angry and directed the advocate to ask the manager to appear before the court.

Coming down heavily on the bank’s lawyer, the judge said, “The Banking Regulation Act says that anything less than 50 paise should not be counted. Why are you harassing people? It’s nothing but harassment by your manager.”

When Gogia pleaded before the court for more time to file a detailed affidavit to put forth the technicalities of the issue, the judge posted the matter for further hearing on May 2.