Set up grievance mechanism for PMC Bank depositors in relation to withdrawal ceiling of Rs 5 lakh: Delhi High Court suggests RBI

The Delhi High Court today suggested that a grievance mechanism be set up for Punjab & Maharashtra Co-operative Bank (PMC Bank) depositors in relation to the withdrawal ceiling of Rs 5 lakh set by the Reserve Bank of India. (Bejon Mishra vs UOI)."Let there be a committee of a retired judge to see if Rs 5 lakh can be released..", a Division Bench of Chief Justice DN Patel and Prateek Jalan said. .The Court was hearing a petition by one Bejon Mishra seeking to insure the deposits of customers of PMC Bank branches in the capital..The Court's suggestion came in response to the petitioner's submission that in spite of the withdrawal ceiling being raised to Rs 5 lakh, the Reserve Bank of India (RBI) was not permitting the same. ."The process of getting this money is very cumbersome..when depositors are writing to RBI, these are not being treated..", counsel for the petitioner, Advocate Shashank Deo Sudhi said. .RBI, in response, said that the decision to allow the withdrawal or deny it was, in fact, with PMC Bank and it had no role to play in it. .Irked by the stand, the Court remarked that since the withdrawal limit was set by RBI, the task of deciding the disbursal of Rs 5 lakh could not be left to PMC Bank. .Justice Jalan said, ."You can't have the Administrator (of PMC Bank) acting in a high-handed manner and deciding everything on his own..You cannot pass it on to PMC Bank. It is your rule, you have to monitor it in some way independent of the Administrator.".It was further added, ."Some valve has to be open for depositors to access their money.."..As counsel for the petitioner pressed for the release of money to the depositors who were facing difficulties, the Court observed that during the present times, everyone was facing some difficulty or the other and there had to be a "gradation of the difficulties". .The Court further stated that a balance had to be struck in between the depositors and the financially ailing bank. . "Sometimes the remedy is worse than the disease. We cannot simply pass orders in this petition (else) everything will be over..", Chief Justice Patel said..Since the main counsel for RBI was recovering for COVID-19 and was thus unavailable, the court adjourned the matter till January 4. .Yes Bank and PMC Bank fundamentally different; PMC Bank had really precarious financials: RBI tells Delhi HC.Earlier this, RBI had told the High Court that PMC Bank was “fundamentally different” from Yes Bank and that the former had “really precarious financials” which did not attract any investors for reconstruction or amalgamation.