‘Don’t Hide Behind RBI’: SC Pulls up Centre Over Loan Moratorium Scheme, Gives 7 days to Clarify Its Stand

New Delhi: The Supreme Court on Wednesday gave the Centre a week’s time to clarify its stand on the waiver of interest on interest for deferred payments of instalments for loans during the moratorium period announced due to the coronavirus lockdown. Also Read – Final Year Examinations: Supreme Court Verdict on College, University Exams Likely Today

A bench headed by Justice Ashok Bhushan took note of the Centre’s alleged inaction, saying that the latter had not made its stand clear on the issue despite the fact that ample powers were available with it under the Disaster Management Act and was “hiding behind the RBI”. Also Read – ‘What’s Wrong in Apologising,’ Supreme Court Asks Prashant Bhushan, Reserves Order in Contempt Case

“My Lordships may not say that. We are working in coordination with RBI,” government after Solicitor General Tushar Mehta said. Also Read – Flat Buyers Entitled to Compensation For Delayed Possession, Lack of Assured Amenities: SC

The bench, also comprising Justices R Subhash Reddy and Justice M R Shah, asked the solicitor general to clarify stand on the Disaster Management Act and whether additional interest on existing interest could be accrued.

Mehta argued that there cannot be a common solution for all the problems.

Senior advocate Kapil Sibal, appearing for the petitioner, informed the bench that the loan moratorium’s deadline would end on August 31 and sought its extension.

“I am only saying that till these pleas are decided, the extension should not end,” Sibal said.

The apex court has now posted the matter for hearing on September 1.

The top court had earlier said there was “no merit in charging interest on interest” for deferred loan payment installments during the moratorium period announced in wake of the COVID-19 pandemic.

(With agency inputs)