Maintaining that guidelines of Union Bank of India for granting education loans was “arbitrary, without rationale and cannot be accepted by any reasonable and prudent man”, Madras High Court today directed the bank to provide Rs 15,000 as education loan to enable a student of diploma in mechanical engineering to pursue his studies.
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Justice S Tamilvanan, allowing a petition filed by Kumar, father of the student Naveenkumar, said though the student had scored 78 per cent in the SSLC examination, the bank had awarded him only 15 marks for academic performance.

For other parameters, including branch of study, selection process followed by the polytechnic, monthly income of parents, period of stay of the student at the current place, and selection process followed by the polytechnic, the bank had allocated 23 marks.

The student had been informed that he could not be granted the education as he had scored only 32 marks, though he was expected to score 50 out of 100 marks, as per the bank guidelines.
The judge said when a public examination had been conducted and the student had been given 78 per cent in it, the bank cannot arbitrarily reduce the same to 38 marks.

It was clear from the IBA Model Loan scheme that diploma students were eligible for loan. The petitioner''s son with 78 per cent was a meritorious student and could not be denied the loan, the judge said.

The student was undergoing a recognised DME course and hence he should be granted the loan. However, though the petitioner had applied for a loan Rs 28,000, the maximum limit fixed by the bank was Rs 15,000.

The judge directed the bank to sanction the loan within four weeks after verifying testimonials.