On Thursday, the Supreme Court asked the government to respond to the concerns of the big borrowers even as it hinted to close proceedings with regard to small borrowers who received waiver of compound interest on loans upto ₹2 crore.
The small borrowers had even received reimbursement of the difference between compound and simple interest payable between March-August 2020, the period coinciding with the moratorium announced by the Reserve Bank of India (RBI) on loan repayment.
The Court’s decision to address sector-specific reliefs sought by a host of manufacturing and business federations did not go down well with the Centre. Solicitor General Tushar Mehta told the Court that since effective orders have been issued with regard to small borrowers (up to ₹2 crore), the big borrowers could address their respective grievances directly to the Reserve Bank of India without keeping this matter pending in Court.
“Let these suggestions directly be made to RBI rather than the matter being kept pending in Court,” Mehta said.
The bench of Justice Ashok Bhushan, Justice RS Reddy and Justice MR Shah replied, “We are not passing any orders. We want these suggestions to go to the RBI.” The matter has been listed next week.
The big borrowers included the association of power producers, confederation of real estate developers, textile mills and knitwear association, jewellery manufacturing association, contract carriage operators, hotel and restaurant association of Chhattisgarh, financial technical institutions, and shopping centres association.
These petitioners had availed huge loans from banks and financial corporations and were unable to repay the loans on account of the loss of business due to the Covid-19 lockdown.