The Supreme Court of India today has adjourned the matter till June 12, on a petition filed challenging charging interest on loans by banks after RBI ordered a 3 month moratorium on the payment of EMIs till May 31 which has now been extended till August 31, 2020.
As the hearing begins, the Solicitor General of India Mr. Tushar Mehta said that the RBI has filed response yesterday, on which Justice Ashok Bhushan reacted that “I need to ask a question, how is RBI filing reply in the media first? We highly depreciate this practice”.
Thereafter, Advocate Rajiv Dutta counsel for the petitioner has made a statement that “this is just a way to sensationalise”.
Justice Ashok Bhushan in a warning tone has said to the SG that “this should not happen again”. Later he says that “There are two issues involved here. One is regarding the charging of interest during moratorium period and the another of charging interest, on this interest itself”.
Subsequently, Justice Sanjay Kishan Kaul speak out that “These are not normal times”, followed by statement from Justice M.R Shah which says that “On one end granting moratorium and again nothing in interest. Its more detrimental”.
SG Mehta seeks time to submit a combined response from both Ministry of Finance and RBI, on which Adv Rajiv Dutta said that “cat is out of bag, they’re saying profitability of bank. I want to quote the courts order in Air India matter”.
In the reply filed by RBI yesterday, it submitted that it would not be appropriate to go for a forced waiver of interest by banks as the same would affect the financial health of the banks and jeopardize the interests of depositors.
Later, Justice Bhushan replied that “Economic aspect not higher than health of people”.
Adv Dutta, added further that “only the banks should earn and rest of the country goes down under? I want to file a rejoinder”.
The Supreme Court three Judges Bench comprised of Justice Ashok Bhushan, Justice Sanjay Kishan Kaul & Justice M.R. Shah heard the matter today, wherein the court allows time to file rejoinder to the petitioner and Solicitor General to submit response till June 12 primarily on the question charging of interest, on interest concerning moratorium on loans.
Earlier, the Supreme Court had issued notice to the Centre and the RBI on Plea challenging charging of interest on loan after a 3 months moratorium granted by RBI and which is being extended till August 31. The Petitioner Gajendra Sharma Challenges charging interest on loans after RBI ordered a three-month moratorium on the payment of EMIs till May 31 which has now been extended till August 31, 2020. The plea has termed this unconstitutional, as during the lockdown, people’s incomes have already shrunk and they are facing financial hardships.
-India Legal Bureau