Kerala High Court Slams Local Bank for Deducting EMIs from Wayanad Landslide Compensation

The Kerala High Court has expressed its disapproval over reports that Kerala Gramin Bank (a rural regional bank) has deducted loan EMIs from compensation funds received by survivors of the recent devastating landslides in Wayanad.

A Bench of Justices AK Jayasankaran Nambiar and Syam Kumar VM has instructed the State’s counsel to investigate whether such practices are occurring among banks.

“Banks are entitled to reclaim loans, but when money is allocated for a specific purpose, the bank holds it in trust for the beneficiaries. It cannot redirect these funds for its own use. Moreover, banks have a fundamental duty to show compassion in such situations.

This is a basic obligation! Please determine whether this issue is happening in the State, Mr Unnikrishnan (Government Pleader). If it is, we will intervene,” the Court remarked. The Bench lamented that such practices reflect a loss of empathy.

“Ultimately, we are losing the humanitarian aspect of the situation! In the first week, everyone expresses sympathy, and by the next week, actions like these occur,” the Court observed.

The Court also instructed the State to ensure that compensation amounts reach the intended recipients.
“Please make sure that any compensation or relief provided is actually received. These individuals should not be expected to come to court,” the Court stated.

This hearing was part of a suo motu case initiated to oversee relief measures in Wayanad following the landslides on July 30, which resulted in the deaths of over 200 people and left many more injured or missing.

The Court aims to address the broader issue of preventing such natural disasters in the future. It plans to approach this in three phases:

1. Phase One: Gather information on scientific measures to prevent natural disasters and monitor rescue operations in affected areas on a weekly basis.

2. Phase Two: Assess whether regulatory disaster management authorities at national, State, and district levels, along with their advisory boards, are staffed by experts and have made recommendations for legal amendments.

3. Phase Three: Implement measures to prevent or manage natural disasters, ensuring public consultation before decisions affecting the ecology of an area are made.

The Court emphasised the importance of collecting data from those directly affected, stating, “Policy makers cannot ignore the views of those on the ground. Public consultation at the grassroots level is essential.”

Additionally, the Court urged attention to be given to Kozhikode, a flood-hit district that has not received sufficient focus. “Relief measures should not only be for Wayanad but also for Kozhikode,” the Court concluded.

For any enquiries or information, contact ask@tlr.ae or call us on +971 52 644 3004. Follow The Law Reporters on WhatsApp Channels.