Rajiv Dutta said that the compound interest on the loan is still going on. In the last hearing, it was said on behalf of the petitioner that due to this decision, the borrower is being double hit because they are being charged compound interest.
Loan Moratorium, Loan Moratorium case, Supreme court News: The facility of loan moratorium granted by RBI in lockdown has ended with the end of August. Now the facility of loan moratorium will be available for a few months or not, for this, you will have to wait till September 28. A hearing was held in the Supreme Court on this matter on Wednesday. During the hearing, the counsel for the petitioners stated that banks are free to restructure the loan but it should not be done by charging interest on the exemption from EMI payment on EMI under Moratorium on honest creditors.
A three-judge bench of Justices Ashok Bhushan, R Subhash Reddy and MR Shah, hearing the case through video conference, heard. According to Money Control, the bench of Justice Ashok Bhushan asked the Center and RBI to file their reply in the case soon. The next hearing of the court will now be on 28 September.
Significantly, the Supreme Court has also sought a response from the Reserve Bank on recovering interest on compound interest i.e. interest and penal interest during moratorium. Arguments have been made in the Supreme Court on behalf of different sectors. The government had to file its reply in the court today but some deferment was demanded.
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According to ANI, the petitioners’ lawyer Rajiv Dutta said that millions of people are in hospital due to Corona epidemic. The source of income of millions of people is over. The central government has to make its stand clear whether it is giving a discount on the payment of EMI or not. He said what was the benefit of restructuring the loan. If this was to be done then why was it not done earlier?
Rajiv Dutta said that the compound interest on the loan is still going on. In the last hearing, it was said on behalf of the petitioner that due to this decision, the borrower is being double hit because they are being charged compound interest. Banks are treating this as the default for charging interest on interest. This is not the default from us. All sectors have sat down but RBI wants the bank to earn profits during the corona.
Come to court with a concrete plan.
While hearing, the Supreme Court said that the case is being deferred again and again. Now this matter is being deferred only once for the final hearing. During this time everyone should file their answer and come to court with a concrete plan in the case. At the same time, the court said that till August 31, interim order will not continue to declare NPAA loan defaulters not NPA. The Supreme Court gave two weeks to file the reply.
Center asked for two weeks
During the hearing, the central government told the court, the highest level is being considered. For relief, two or three rounds of meetings have been held in consultation with banks and other stakeholders and concerns are being investigated. The Center had asked for two weeks, on which the court asked what is going to happen in two weeks? You have to do something concrete for different areas.
Please tell that after the moratorium facility is over, people have started getting messages, phone calls and e-mails from banks to pay EMI. Due to this, people are afraid of declaring their bank loan account as non performing asset. The Supreme Court has given interim relief to the customers in this case.
