Plea challenging interest on loans during RBI Moratorium period: LIVE UPDATES from Supreme Court

The Supreme Court is hearing petitions challenging the Reserve Bank of India's move to charge interest on term loans during the moratorium period introduced in light of the COVID-19 pandemic..The Bench of Justices Ashok Bhushan, R Subhash Reddy and MR Shah is hearing the matter. The Court had been due to hear the case yesterday but due to paucity of time, the hearing was deferred till today. .Live updates of the hearing today feature on this page. .Senior Counsel Harish Salve for IBA suggests that the Court takes up the hearing on a day when the Bench can hear the matter for the whole day. .He points out that that Centre and RBI have filed their additional affidavits and detailed arguments may be required to be made..Senior Counsel P Chidambaram for one of the petitioners, Shopping Centres Association of India, submits that his petition concerns the issues that have been touched upon by Centre and RBI and he may be heard also. .Senior Counsel Rajiv Dutta for the petitioner in the lead case: The banks are already capitalising on the existing loans with compound interest. That should stop. .Salve: Nothing can be stopped like this. We (Banks) will have to be heard..Dutta: We (individual borrowers) are small people, we are not covered under Kamath Committee report etc. This charging of compounded interest must stop .Court points out that the Court has already passed order not to declare loan accounts as NPAs and compound interest on small loans has been waived by the Centre..Court: Your main concerns have been addressed. .SG Tushar Mehta for Centre seeks to make arguments, highlights what the original point of contention was in the litigation. .Court asks how long is the government expected to implement the assurances made in terms of compound interest waiver..Court asks Salve about what is being done from the Banks' end in terms of waiver of compounded interest. .Salve: At present, whatever the government has said about interest on interest is happening. It will have to be done and it will be worked out..Mehta: My difficulty is every time when the bench takes up the matter, whatever comes to the mind of litigant is being projected and we are expected to give answers. .Court: We are only asking if the waiver of compounded interest is percolating to benefit the borrowers.SG Mehta reads from the affidavit filed by the Centre.Mehta: There are already discussions and contemplations taking place. .Salve: The RBI has to issue a circular for this because we (banks) cannot do it without a circular of the RBI..Salve: We are saying it will be done. Centre has assured, it will be done. .Court: We are only asking when will it be done. .Mehta: Governement has given the assurance on affidavit and have already said that decision is taken but only modalities have to be worked out..Mehta: It is only for these modalities that time till November 15 is sought..Justice Bhushan: Our only observation is that if decision is taken to waive the compounded interest, then one month period may not be required for implementing this decision. .Mehta: This observation nay be a little harsh..Justice Shah: This is a welcome a decision, but the small borrowers want to see some results. Consider the plight of the common man..Mehta: We don't stand to gain anything in delaying it but how it operates is the banks will waive the interest in interest and thereafter they will have to get reimbursement from the government. .Mehta: There are eight categories identified and computation will be done based on interest component of each of those accounts..Chidambaram suggests that the Court wishes to send out a message to the common man. .Mehta takes objection to it, says the message has already been sent and centre has taken the decision in this regard..Court assures that the Court welcomes the decision of the Centre but only wants to know when the decision will be implemented. .Supreme Court adjourns the hearing till November 2..Supreme Court orally observes that it expects the centre's decision to be implemented by then. .Justice MR Shah to SG Mehta: Mr. Mehta, in lighter vein, their Diwali is in your hands..Hearing concludes.

Plea challenging interest on loans during RBI Moratorium period: LIVE UPDATES from Supreme Court

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