Had no means to pay, claims N.T. Joseph

Outside the shed propped up on areca nut tree trunks and covered with a thin blue tarpaulin sheet, Leelamma Joseph recounts how N.T. Joseph, 73, her husband, landed in prison for defaulting on their daughter’s education loan of Rs.1.25 lakh.

“Two men came here last Thursday [February 20] at 3 p.m. They told my husband that he had to go with them to sign some court papers concerning the loan. They told him that he would be back in an hour,” Ms. Leelamma said.

The family did not hear from Mr. Joseph till late in the evening. “His lawyer called up and said he was under arrest. He said we should either pay up the loan amount or he would be transferred to the Kannur Central Jail. We collected Rs.25,000 after selling my daughter-in-law’s jewellery. But they refused to accept the money and he was remanded,” she said.

Mr. Joseph has been in jail for close to a week now. “He is a heart patient and has arthritis. I do not know what the hurry was to arrest him. He was anyway going to attend a bank adalat for education loan defaulters the next day,” she said.

Mr. Joseph’s arrest came hardly three days after Union Finance Minister P. Chidambaram announced a moratorium on all education loans borrowed up to March 2009 and outstanding as on December 2013 — a move which came as a relief to approximately nine lakh student borrowers.

“There are 26,000 education loanees in Kozhikode alone and over 3.65 lakh of them in the State [Kerala]. Almost half of these loans are in default due to severe financial difficulties of the loanees, lack of employment opportunities, and rising interest rates,” R. Radhakrishnan, State president, Education Loanees Welfare Organisation, said.

Mr. Joseph’s family took the loan in 2004 to get daughter Sherin admitted to a nursing course. Mr. Joseph borrowed from the nearest Cheekkonnu branch of the State Bank of Travancore (SBT) at an interest of 11 per cent.

“We could not pay even a single instalment of the loan. Our land at Panniyeri (Vadakara) was classified as an ecologically sensitive area. We suffered agricultural loss. There was no means to pay. Now, we have to repay Rs 3.25 lakh,” Ms. Leelamma said. Enquiries revealed that the Cheekunnu branch alone had unrealised education loans to the tune of Rs 2.5 crore.

After the nursing course, Sherin landed a job that paid her Rs.1,500 a month in Bangalore and later another for Rs.3,000 a month in Thiruvananthapuram. She married and left her job to care for her children and now lives in Kannur.

SBT sources denied any wrongdoing on their part. A civil suit was filed in 2010 following a “total lack of cooperation” on the part of Mr. Joseph. They said his arrest and incarceration were part of the “process of law,” claiming that Mr. Joseph had misinformed the court that he had no means to repay the loan.

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