The Madras High Court has upheld the State Bank of India’s (SBI) decision to cancel the appointment of a candidate due to an adverse credit history reflected in his CIBIL report.

Justice N Mala observed that financial discipline is essential in the banking sector, as employees handle public money and are expected to uphold the highest standards of fiscal responsibility.

The court was hearing a petition filed by P. Karthikeyan, whose appointment as a Circle Based Officer (CBO) was revoked by SBI. The petitioner had cleared all stages of the recruitment process, including the examination, interview, medical and document verification. An appointment letter was issued on March 16, 2021. However, a CIBIL report dated March 12, 2021, revealed adverse credit history, prompting the bank to seek an explanation.

Despite submitting his explanation and requesting to be allowed to join, the petitioner’s appointment was cancelled. He contended that on the date of the job notification, he had no outstanding dues and had not been declared a defaulter by CIBIL or any other credit agency. He further alleged discrimination, claiming that similarly placed candidates were allowed to join service.

In response, SBI argued that under Clause 1(E) of its eligibility criteria, candidates with a history of loan defaults or adverse CIBIL reports were ineligible for appointment. The bank maintained that the petitioner had defaulted on multiple loan installments and had suppressed material facts regarding his financial background.

The court, after reviewing the CIBIL report, found that the petitioner had nine irregular credit facilities and more than ten credit inquiries. It also noted the petitioner’s own admission of having defaulted on loan repayments. Dismissing the allegation of discrimination, the court held that only those candidates who met the prescribed criteria had been appointed.

Emphasizing the importance of integrity and financial prudence in banking roles, the court concluded that SBI was justified in revoking the petitioner’s appointment. Finding no merit in the plea, the petition was dismissed.

Case Title: P. Karthikeyan v. The General Manager and Others
Counsel for Petitioner: Mr. V. Sidharth
Counsel for Respondents: Mr. C. Mohan, Ms. A. Rexy Josephine Mary (for M/s. King & Partridge)