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The matter will be taken up on September 23. In the meantime, the life of all interim court orders in the State has been extended.
The Kerala High Court on Monday asked the Centre to apprise it of the Supreme Court's stance regarding whether Banks can initiate recovery proceedings against loan accounts declared Non-Performing Accounts (NPAs) prior to the COVID-19 lockdown (Court on its own motion suo motu proceedings v. State of Kerala).
While considering applications by banks seeking to continue with such recovery proceedings, the Court took note that an interim order had been passed by the Supreme Court recently in the Loan Moratorium hearings, which directed Banks to refrain from declaring bank accounts as NPAs after August 31.
Senior Advocate EK Nandakumar and Advocate Jawahar Jose, representing the banks, urged the Court that recovery proceedings could be initiated against loan accounts declared as NPAs prior to the lockdown.
The Court, however, sought further clarification since it did not have a copy of the Supreme Court order at the time.
The Full Bench comprising Chief Justice S Manikumar, with Justices CT Ravikumar, and Shaji P Chaly has, therefore, asked the Centre to explain the implications of the loan moratorium hearings.
Directing the Counsel for the Centre to respond on this question, the Court observed that the Supreme Court's orders on the subject had to be awaited before the Banks' request was allowed.
In the interim, the Court's Order extending the life of interim orders passed by all Courts and Tribunals in the State will continue, the Bench said.
The Supreme Court continued its hearings on the question of charging interest during the loan moratorium period and the initiation of proceedings against NPAs today. The matter has been posted to be taken up again after two weeks' time.
The matter before the Kerala High Court is expected to be taken up next on September 23, 2020.
The issue was taken up as part of the suo motu writ petition registered by the Court to monitor various issues that may arise amid the COVID-19 pandemic.
Since then, the Court has dealt with a wide range of subjects in hearings, including the status of its interim orders and the status of prisoners released on remand. Prior to Monday's order, the last order was passed on August 3.
Read the Order here: