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The Supreme Court today directed banks and financial institutions to restructure loans given to Amrapali home buyers and release the rest of the amount that was withheld so far. (Amrapali Final Order)
In a bid to ensure generation of funds and completion of stalled projects, the Bench of Justices Arun Mishra and UU Lalit has directed the Reserve Bank of India (RBI) to keep its circulars and guidelines related to Non-Performing Assets (NPAs) "in abeyance" for loans to the home buyers.
"In view of current social and economic conditions, the Court may direct the RBI to keep its circulars/guidelines relating to NPA in abeyance and permit all banking and financial institutions, etc. to disburse loans to home buyers notwithstanding the status of accounts as NPA."
Supreme Court
The two-judge Bench has also directed that banks and financial institutions work out a "long-term restructuring of all home buyers' loans about Amrapali Projects as well as any charges on the Amrapali project held by banks and financial institutions". The order states,
"We direct the banks and financial institutions to release loans to home buyers, whose loans have been sanctioned, notwithstanding the fact that their accounts are declared as NPAs. Let there be restructuring of the loan amount. It may be released under the current norms of the RBI for releasing loans and the rates fixed by the RBI thereof."
Supreme Court