The Supreme Court on Thursday asked the RBI to examine whether benefits of its policy decision on three-month moratorium on fixed-term loans and EMIs are being passed on to the borrowers.
A Bench led by justice NV Ramana said “it appears that whatever benefits are being given by the RBI, they are not being extended to the borrowers. There should be proper guidelines. The RBI may examine it to see the circular issued on March 27 is being implemented by the banks effectively. This is not a PIL issue. However, due to the various issues raised, we request that the RBI may examine whether its policy is being implemented in true letter and spirit”.
However, the Bench refused to interfere in the matter after the petitioners informed the judges that they were not personally affected and had filed the PILs in public interest.
The observations came during hearing of petitions challenging a part of the March circular with regard to recovery of interest accrued on the outstanding portion of the term loans during the moratorium period between March 1 and May 31 amid the coronavirus pandemic.
Seeking directions to all banks and financial institutions not to charge interest from their customers during the moratorium period in the larger public interest, the petitions alleged that the RBI’s circular was eyewash as the accumulated accrued interest on the outstanding amount shall be recovered immediately after the moratorium period.
“The State cannot enrich itself nor permit anyone to enrich from the unfortunate situation by charging interest for moratorium period,” one of the petitioners had contended.
The PILs had stated that the government and the RBI were “duty bound to support citizens” by extending the moratorium period as the pandemic had impacted each and every segment of society and its consequences would be far more serious even after lifting of the lockdown.
