NEW DELHI, Nov 5: The Supreme Court on Thursday rescheduled hearing on November 18 a plea by the Reserve Bank of India to vacate the interim stay on declaring non-performing assets of the accounts not already declared as NPAs by August 31 till is further orders.
The RBI counsel V Giri told the bench headed by Justice Ashok Bhushan that the central bank was “facing difficulty” due to the interim order. The bench was hearing a batch of pleas relating to charging of interest on interest by banks on EMIs, which were not paid by the borrowers who availed of the loan moratorium scheme in view of the Corona pandemic.
In a relief to stressed borrowers who are facing hardships due to the impact of the pandemic and lockdown, the apex court had passed the interim order on September 3.
Giri told the bench, “We are facing difficulty due to order banning declaring of NPAs.”
The RBI and the Finance Ministry have already filed separate additional affidavits in the top court saying that the banks, financial and non-banking financial institutions will credit into the accounts of eligible borrowers by November 5 (Thursday) the difference between compound and simple interest collected on loans of up to Rs 2 crore during the moratorium scheme period.
Senior advocate Rajiv Dutta, appearing for one of the petitioners, told the bench that they are grateful to the Centre and the RBI for hand-holding small borrowers and said that his plea be disposed of.
The pleas pertained to charging of interest on interest by banks on EMIs which have not been paid by borrowers after availing the loan moratorium scheme of RBI during March 1 to August 31.
Earlier, the RBI had filed the affidavit saying that it has asked all banks, financial and non-banking financial institutions to take “necessary actions” to credit into the accounts of eligible borrowers the difference between compound and simple interest collected on loans of up to Rs 2 crore during the moratorium scheme.
Prior to this, the central government had told the apex court that lenders have been asked to credit into the accounts of eligible borrowers the difference between compound and simple interest collected on loans of up to Rs 2 crore during the RBI’s loan moratorium scheme by November 5.
On October 14, the apex court had observed that the Centre should implement “as soon as possible” the interest waiver on loans of up to Rs 2 crore under the RBI’s moratorium scheme and had said that the common man’s Diwali is in the government’s hands.
The RBI had on March 27 issued the circular which allowed lending institutions to grant a moratorium on payment of installments of term loans falling due between March 1 and May 31, 2020, due to the pandemic which was further extended till August 31.
(Manas Dasgupta)