The Apex Court on August 26 (Wednesday) heard a plea seeking waiver of interest during the loan moratorium period as granted by the Reserve Bank of India which is supposed to end on August 31 as announced by the RBI in the month of March, 2020. This move was intended to provide the borrowers relief during the Covid 19 crisis.
A three judges’ bench of Justices RS Reddy, M R Shah and led by Justice Ashok Bhushan were of the view that the Centre has not made its stand clear on the issue in spite of the fact that ample powers are available to the Government under the Disaster Management Act. “Government should not think about only business, should also think about plight of people… The government seems to be hiding behind the RBI”, said Justice Ashok Bhushan.
The Solicitor General Tushar Mehta, appearing on behalf of the centre argued, “there cannot be a common solution for all the problems.” He further added, “The stand of the Union of India and the RBI are not different… A fresh decision has been taken by the RBI on August 6 for a focused sectoral approach for different categories of borrowers instead of one size fits all…”. The Supreme Court has given SG Mehta a one-week extension to file the affidavit on the matter.
The Plea was filed before the Hon’ble Supreme Court by a resident of Agra, Gajendra Sharma, seeking directions from the apex court to declare the portion of the RBI’s notification on March 27 as ultra vires. RBI on March 27 in a press conference announced that all financial institutions have been permitted to allow a moratorium of 3 months on repayment of loans outstanding on March 1, 2020