dont use muscle power. Chief Justice S.V. Gangapurwala and Justice P.D. Audikesavalu record the submission of Reserve Bank of India that it had already issued elaborate guidelines to all banks with respect to the issue of engaging recovery agents

[6/17, 09:34] sekarreporter1: DU
Banks cannot use muscle power to recover loan amount, says Madras High Court
Chief Justice S.V. Gangapurwala and Justice P.D. Audikesavalu record the submission of Reserve Bank of India that it had already issued elaborate guidelines to all banks with respect to the issue of engaging recovery agents
June 16, 2023 11:34 pm | Updated 11:34 pm IST – CHENNAI

Mohamed Imranullah S MOHAMED IMRANULLAH S.
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The judges recorded the submission of advocate representing RBI, that the Central bank had already issued guidelines making it clear that all banks must resort to only legal means to recover dues.
The judges recorded the submission of advocate representing RBI, that the Central bank had already issued guidelines making it clear that all banks must resort to only legal means to recover dues. | Photo Credit: SPECIAL ARRANGEMENT

If banks have to recover outstanding loan amount, the same has to be recovered in accordance with the procedure established by law. Coercive method of recovery by private agents, if appointed by banks, is not permissible. The banks certainly cannot use muscle power to recover the loan amount, the Madras High Court observed on Friday.

Disposing of a public interest litigation petition alleging coercive methods being used against farmers, the first Division Bench of Chief Justice S.V. Gangapurwala and Justice P.D. Audikesavalu wrote: “No muscle power can be exercised by the agents. If coercion is employed, then certainly the agriculturists will have every right to approach the police
[6/17, 09:35] sekarreporter1: ,