Banking disputes often begin with differences between a commercial understanding and the final loan or security documents. Kothari & Jain advises on financing terms, guarantees, security arrangements, banking complaints and recovery-related issues. Early review can identify obligations that continue beyond disbursement, including reporting duties, renewal conditions and events of default.
Before signing or drawing funds
A sanction letter should be read with the facility agreement, mortgage or security documents and any guarantee. We review the legal allocation of responsibilities and identify provisions requiring clarification. A comparison may be needed between the written documents and earlier communications on interest, charges, repayment, prepayment, utilisation conditions or release of security.
- Review of term loans, working-capital facilities and related documentation.
- Advice to borrowers or guarantors on obligations and proposed amendments.
- Review of security, indemnity and default provisions.
- Assessment of banking service complaints and correspondence.
- Advice on recovery notices, settlement proposals and appropriate proceedings.
When a dispute or recovery notice arrives
The immediate priority is to identify the document received, its date of service and the legal process being invoked. A reminder, recall notice, possession-related notice and tribunal proceeding are not interchangeable. Keep the envelope, email delivery record and complete enclosure set. A negotiated proposal should be considered alongside applicable response and filing deadlines rather than treated as a substitute for them.
The RBI Complaint Management System guidance describes its route for unresolved complaints against relevant regulated entities. The appropriate complaint process, eligibility and procedural conditions require checking. An Ombudsman complaint, contractual proceeding and challenge to enforcement action serve different purposes; no single route should be assumed to resolve every banking dispute.
Preparing a useful case file
Collect the sanction and revision letters, signed agreements, repayment schedule, full account statements, security documents, guarantees and all notices. Include proof of payments, disputed charges, complaints already raised and the bank’s replies. For restructuring or settlement discussions, provide a realistic cash-flow position and the source and timing of proposed funds. An offer that cannot be performed can create further difficulty.
We also ask who owns the secured asset, who borrowed, who guaranteed and which parties signed each document. Those roles may differ. Advice on a company facility may therefore need to address both the entity’s position and the separate interests of a director, security provider or guarantor, subject to conflicts.
Common questions
Does an oral assurance override the signed loan terms?
Do not assume it does. Preserve written communications and have the complete documents reviewed before accepting or disputing a contractual obligation.
Will negotiations stop recovery proceedings?
Do not rely on discussions alone. Any standstill, revised arrangement or withdrawal should be clearly documented, while existing deadlines are addressed.
Can you obtain a particular loan sanction or settlement?
Legal advice can support document review, representations and negotiation. The lender’s commercial decisions and the outcome of any proceedings cannot be guaranteed.
Discuss your matter
To arrange a discussion, call +91 8793660616 or +91 7887718191, or use our contact page. Please initially share the parties’ names, a short description and any approaching deadline so that conflicts and the appropriate scope of assistance can be checked.