Supreme Court ruled today on waiver of moratorium interest
The Center and the Reserve Bank of India (RBI) told the Supreme Court on Tuesday that the moratorium on loan repayment can be extended to two years under certain conditions. And the sectors that are hardest hit by the economic slowdown will be identified.
“We are in the process of identifying the affected sectors based on the impact of the hit taken,” said Attorney General Tushar Mehta of the three-judge bank headed by Judge Ashok Bhushan.
The top court said it would hear the matter again and decide on a series of petitions on Wednesday calling for an interest waiver or interest waiver on the suspended monthly payments during the moratorium period.
The bank heard a lawsuit against the charging of interest on loans during the moratorium period.
The lawsuit, filed by Agra’s Gajendra Sharma, sought an instruction to declare the part of the March 27 notice to RBI as something outside the bank’s legal or authority. That is, provided that the interest on the loan amount raised during the moratorium period is a hardship for the petitioner as a borrower. It creates hindrances and hindrances to the “right to life” guaranteed by Article 21 of the Constitution.
The Supreme Court ruled in June that it was not a question of a complete waiver of interest for the entire moratorium period, but only of interest charged by banks on interest.
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It also found that banks’ charging of interest during the six-month moratorium period on fixed-term loans was “detrimental”.
For its part, the RBI had stated that waiving interest on loans would affect the financial viability of the country’s financial sector. It was also said that banks could forego Rs 2 trillion in interest income if interest were waived for the six month period of the moratorium.
On Tuesday, the attorney general proposed a meeting of representatives of the finance ministry with the RBI and banks to find a solution.
He also asked for more time on behalf of the center and asked the bank to review the affidavit submitted by the government. However, the bank said the final hearing would be on Wednesday.
RBI’s circular on personal loan restructuring states that resolution plans may include debt restructuring or the granting of a moratorium based on an assessment of the borrower’s income streams, subject to a maximum of two years.
“The total term of the loan can change accordingly. The moratorium period, if granted, comes into effect immediately after implementation of the wind-up plan, ”it said.