"Accounts not declared NPA as on August 31 shall not be declared NPA till further orders,” the apex court bench led by Justice Ashok Bhushan declared in its interim order. The apex court will resume hearing on September 10.
The apex court also asked the RBI to clarify if its the discretion of banks to offer relief to borrowers.
“What the centre is saying seems to be for new loans, not existing ones,” the bench noted. “What about demand on compound interest in the meantime?.”
The apex court was hearing several petitions from individuals, the real estate companies and hotel associations seeking a waiver on paying interest dues. Senior counsel Kapil Sibal and Rajiv Dutta have requested the Supreme Court to issue directions to the RBI and the central government for waiving off the interest accrued on loan repayments during the moratorium period.
Senior counsel Harish Salve representing lenders submitted that no account shall become NPA for a period of two months. Salve also states that a separate restructuring committee had already been set up that would assess the issues of various sectors.
The government and RBI who are represented by solicitor general Tushar Mehta defended their stance and submitted that the issue required a holistic approach instead of a knee-jerk reaction. He argued that the idea of moratorium was to defer payments in wake of burden by covid-lockdown, so businesses could manage working capital better, the idea was not to waive interest.
“We have to realise that banks form a substantial part of the economic stability of the country. We can do nothing about economic revival without looking after the interest of the banks also. So banks is also a part of the revival framework conceived by the country as a financial policy,” Mehta argued.
To soften the economic blow caused by the pandemic the banking regulator had mandated banks to grant a moratorium on paying interest dues for a period of three months till May. This was later extended till August 31.
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33 Comments on this Story
AVdhesh kumar15 days ago
Sir I take loan from Hdfc bank for my Ice Cream factory .sir jab Mene fabrubary 2020 me apna business strat Kiya Tabhi 24march2020 ko Hamare pradhan Mantri ji ne full country me pendamic lock down laga diya Aur ye kaha chahe jo ho jaye ghar se bahar nanhi niklana he Uski vajah se aaj tak mera business close he .me apni loan Ki EMI kanha se pay karu. Mere ghar per daily hdfcbank ke worker gali galoj dekar loan Ki EMI jama karne ke liye kahte he. Mera manniy supreem court se nivadan he Ki harmari Surkhachha ki jaye Aur loan moratorium ko bina interest ke Two year ke liye forward Kiya jaye. Aap ki bahut kripa hogi. Yeah problem Kendra Sarkar ke di hui he .
Manoj Kumar Gupta27 days ago
Govt. & RBI should immediately increase the moratorium period itself ,there is no need of SC in public welfare decision. But complete weiver of interest is not wise demand ,instead some relexation in it may work. Citizen & MSME or business community needs time to re-collect & stand again in this trying period.
ARNAB PAL42 days ago
Sir, I have a loan with a NBFC COMPANY. I was paying regularly my EMI but from the month of May your salary is stopped and at present we are getting salary on per day basis. I applied for moratorium in the month of May end for June ,July and August which has ended on August 31st. Now at this juncture I am not able to pay any amount of money to the NBFC company. But over phone they are pressuring me and giving threatening calls which has been auto recorded.At this point My family is feeling very insecured. Kindly suggest what to do.