Rise of wilful defaulters

In reference to “Wilful defaulters owe public sector banks R66,190 crore says Sinha” (FE, May 4), the rise in the number of wilful defaulters, and the defaulted dues of R66,190 crore as of December 31, 2015 points to the ineffective recovery actions. It also sends a wrong message that the PSBs are lenient and are powerless to recover the money lent to it’s constituents. The lag in identifying and declaring wilful delinquents, initiating appropriate actions, and the inordinately delayed decisions from the courts and recovery tribunals is paving way for more default. The passage of the new bankruptcy code will be of great support to banks, more particularly to the government banks where the incidence of NPAs is higher as compared to the private and foreign banks. The banking sector need to be rejuvenated to make it capable to deliver the intended results. The economy needs highly performing banking sector to accelerate the growth process. The growth of the bad assets jeopardises the growth and development of the economy and is adversely affecting efficiency. Government and banking regulator have to look for comprehensive action plans to speed up the recovery of the bank funds.

VSK Pillai , Kottayam (Kerala)

Cesses and surcharges

Apropos of the recent edit “Cess pool” (FE, May 2) There needs to be greater concern on our approach to taxation Revenue is augmented by economic growth and never by instigating price spirals through casual taxation. The government adds one cess after another, on an already higher consumer price base. Moreover, the cess collected lies unspent, stoking inflation in more ways than one. When a new cess is levied, the government must be bound to lay a status paper before the parliament on their utilisation. A surcharge is even more blatant.

R Narayanan, Ghaziabad