NEW DELHI: The Centre on Thursday told the Supreme Court that the loan moratorium and related issues were fiscal policy matters and that the government has taken proactive steps keeping in mind the needs of different sectors.
The Centre made the submissions while apprising the SC about the steps taken so far by the Union Finance Ministry and the Reserve Bank of India (RBI). The government told the bench headed by Justice Ashok Bhushan that this was not a case of ‘no action’ and added that there may be no further indulgence even if the petitioners claim there could a better option.
The bench was also told by Solicitor General Tushar Mehta that the petitioners’ move to ask for sector-specific reliefs from the top court now is “perhaps not a remedy available” under Article 32 of the Constitution.
The SC was hearing a batch of petitions relating to the charging of interest-on-interest by banks on EMIs not paid by borrowers who availed of the loan moratorium rolled out by the central government.
The Reserve Bank had, on March 27, issued a circular which allowed lending institutions to grant a moratorium on payment of instalments of term loans falling due between March 1, 2020, and May 31, 2020—later extended to August 31.
The RBI and the Finance Ministry have already filed separate additional affidavits in the top court saying that the lenders will credit the difference between compound and simple interest collected on loans of up to Rs 2 crore during the moratorium period.