Loan moratorium: the interest aspect cannot be ignored, be fair, SC told the Center


India

oi-Vicky Nanjappa

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Updated: Tuesday September 1, 2020, 13:25 [IST]

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New Delhi, 01 Sep: The Center and the Reserve Bank of India have informed the Supreme Court that the moratorium on loans is extendable to 2 years.

We are in the process of identifying struggling sectors to vary the benefits depending on the impact of the coup they suffered, the Center and the RBI told the court through Solicitor General Tushar Mehta.

Loan moratorium: the interest aspect cannot be ignored, be fair, SC told the Center

When Mehta told the court that interest on interest during the moratorium could be considered, the judiciary said that the interest aspect cannot be ignored as a whole. Please be fair, the court also said.

Mehta then suggested a meeting of representatives of the Center, RBI and other banks to find a suitable solution. The court said this case could not be delayed any longer. While setting the hearing date for tomorrow, the Panel indicated that this would be the only case it would hear.

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The court on Wednesday arrested the Center for failing to take a position on granting a moratorium on the imposition of interest on loans as well as interest on interest during the same period declared during the pandemic .

“You state your position clearly. You cannot say anything. It is your responsibility to take action under the Disaster Management Act. You have sufficient powers to decide the issue of waiver. You cannot not depend solely on the RBI, “a bench made up of judges Ashok Bhushan, R Subhash Reddy and MR Shah said.

“Now is not the time to be solely concerned with business interests, but you also have to consider the plight of people. This is what RBI positions look like and you take no position at all,” he said. observed the highest court.

“There are two questions here. Whether interest should be charged and whether interest on interest should be charged during the moratorium period,” he said.

The Supreme Court gave the government time after Solicitor General Tushar Mehta asked for a week to file a response.

“My Lordships cannot say that. We are working in coordination with RBI,” Mehta said.

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