Loan Moratorium Case Supreme Court Says Interest Waiver Not Possible, Banks Must Pay Depositors
The Supreme Court on Tuesday refused to interfere with the government’s and the Reserve Bank of India’s (RBI) loan moratorium policy, and refused to extend the loan moratorium period by six months.
A bench led by Judge Ashok Bhushan today heard a series of pleadings from various respective parties, including trade associations, the real estate and power sectors, who have called for an extension of the moratorium on loans and further relief due to the COVID-19 pandemic.
Hearing the arguments, the Supreme Court, which reserved its verdict on December 17, issued a new judgment on the loan moratorium case, declaring that a full interest waiver is not possible because it affects depositors .
Judge MR Shah when reading the Supreme Court judgment “stated that we have heard the respective parties in the case. This is neither in the area of scope nor in judicial review. Waiver of interest full is not possible because they have to pay interest to depositors as account holders and retirees.
“The Court will not debate academic questions on trade and commerce. It is not for us to decide whether public policy could have been better. The government has its own compulsion to handle the matter. No summons of mandamus do. can be issued in the case. The center can decide it, ”Shah said.
Judge MR Shah further noted that various measures had been taken by RBI, Center; can not say that they have not addressed the problems of borrowers.
On November 27 last year, the Supreme Court asked the central government to ensure that all measures are taken to implement its decision to waive interest on eight specified categories of loans paid up to 2 crore of rupees.