NEW DELHI: The Supreme Court today granted one week's time to the Reserve Bank of India (RBI) to respond to a report of a committee appointed to deal with bad loans with banks that have crossed Rs 8 lakh crore.
A bench of Chief Justice J S Khehar and Justice D Y Chandrachud gave the federal bank time till July 24 to file its response to the report of a committee set up by it to suggest measures to deal with increasing of loan defaults.
Lawyer Prashant Bhushan, appearing for the NGO 'Centre for Public Interest Litigation' (CPIL), said that the RBI was asked to disclose the names of big loan defaulters who owe Rs 500 crore.
The counsel for the RBI opposed the contention, saying that the federal bank was not under an obligation to reveal the names and the court could deal with the report on it.
The bench ordered listing of the PIL for hearing after four weeks.
The apex court had in November last year observed that the disclosure of names of big loan defaulters who owe Rs 500 crore and more to banks, would not lead "anywhere" as the important issue was to address "root cause" of accumulation of the non-performing assets (NPAs).
The observations had come after the Supreme Court had repeatedly asked the RBI and the Centre about the possibility of disclosing names of those who have defaulted in repaying loans.
The CPIL had been seeking disclosure of the outstanding loan amount and had cited an apex court verdict of December 2015 to claim that the RBI has to provide all information.
The apex court had earlier expressed concern over the growing amount of loans not being returned and said, "People are taking thousands of crore of rupees and running away by declaring their companies insolvent, but poor farmers who take small amounts of Rs 20,000 or Rs 15,000 suffer."
The court had on April 12, 2016 suggested making public the total outstanding amount without disclosing defaulters' names, but the RBI had resisted the proposal citing the confidentiality clause.
The RBI had in May this year decided to constitute an oversight committee with more members after the government armed it with additional powers to resolve bad loans with banks that have crossed Rs 8 lakh crore.
Outlining the action plan to implement the Banking Regulation (Amendment) Ordinance, 2017, the RBI had said credit rating agencies will be given greater role in dealing with large amount of stressed assets in the banks.
The petition, which was filed in 2003 by the CPIL, had originally raised the issue of loans advanced to some companies by state-owned Housing and Urban Development Corporation (HUDCO).
The plea had said that about Rs 40,000 crore of corporate debt was written off in 2015.
The Supreme Court had then directed the RBI to provide a list of companies which had defaulted bank loans of over Rs 500 crore while expressing serious concern over the growth in such loans.
It had also asked the RBI to provide a list of companies loans of which have been restructured under the corporate debt restructuring schemes.
The bench had expressed surprise that no concrete steps had been taken for recovery of loans from the defaulters.