"We are not experts in financial matters:" Supreme Court refuses to entertain plea for loan moratorium extension amid COVID-19

The Supreme Court on Friday refused to entertain a plea seeking directions to the Central government to permit all lending institutions to grant interest-free moratorium on term loans amid the COVID-19 pandemic..While dismissing the plea, a Bench of Justices Ashok Bhushan and MR Shah said that the matter is one which falls within the executive domain of policy. "The financial reliefs and other measures are in the domain of the government and relates to policy matter. We are of the view that no directions can be issued in this regard. We observe that it is up to the Government of India to assess the situation and pass appropriate orders," the Court said. .Justice Shah clarified that the top court had dealt with the issues raised in this petition during the first wave of the COVID-19 pandemic."In earlier round of litigation, we have dealt with all these aspects. These are all in policy decision realm. We are not experts in matters of financial implication," noted the Bench. .Loan moratorium amid COVID-19 second wave: Supreme Court indicates that it cannot grant extension.The petition drawn by Advocate Vishal Tiwari sought relief for lenders on the ground of unemployment and loss of business opportunities in the wake of the second wave of COVID-19.The plea stated that the Central government and its concerned ministries along with the Reserve Bank of India (RBI) have failed to bring in any sound relief in this present situation for stressed sectors and individuals for whom sustenance and existence have come under a cloud.."No such monetary relief and packages has been declared by the sovereign in this stressed time and people are under tremendous pressure to maintain the EMIs and is always under the threat of accounts being declared NPA. With no salary, revenue for individuals it has turned out to be a hopeless situation for individuals. The RBI on 6-5- 2021 has issued a circular for resolution plan 2.0, which cannot be said adequate relief to all in the present circumstances being arbitrary, unfair and just an eyewash," the petition stated..It thus sought directions for a loan moratorium, as well as deferment of the payment of loan instalments for a period of six months ,or till the COVID-19 situation normalises..The plea pointed out how the RBI, through its circular dated August 6, 2020, provided facility of restructuring during the first wave of COVID-19.The present situation too requires similar and immediate relief for the citizens of this country, it was submitted..It was further stated that a circular dated May 6, 2021 introducing a resolution plan for stressed Micro, Small and Medium Enterprises (MSMEs) during the second wave of COVID-19 is not benefitting the real stressed borrowers."With no salary, revenue for individuals it has turned out to be a hopeless situation for individuals. The RBI on 6-5- 2021 has issued a circular for resolution plan 2.0, which cannot be said adequate relief to all in the present circumstances being arbitrary, unfair and just a eyewash," the plea stated..Tiwari sought directions so that no bank or financial institution acts against any property of any citizen or body corporate for non-repayment of loans, for a period of six months.He further sought directions so that no account shall be declared as a non-performing asset for a period of six months..[Read an account of today's hearing].Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.