A bench headed by Justice Ashok Bhushan has adjourned the hearing of the Loan Moratorium Case to November 18. The bench heard the batch of pleas related to charging of interest on interest by banks on EMIs not paid by the borrowers under the RBI loan moratorium scheme from March 1 to August 31.
However, the Finance Ministry of India and the Reserve Bank of India have already stated that the banks and other financial institutions will take “necessary actions” to credit into the accounts of eligible borrowers by November 5. The Loan Moratorium Scheme is applicable on loans of up to ₹2 crores. The government said that the lending institutions will credit this amount in the accounts of borrowers for the 6-month loan moratorium period.
The pleas sought that no interest should be charged during the moratorium as citizens were facing “extreme hardship, whereby business and work have come to a halt and the entire market has crashed.” It also sought the RBI to “appropriately consider extending the moratorium period for a certain period so as to enable millions of persons, who may get unemployed due to COVID-19 health emergency for some time even after lockdown”.
The apex court told the centre to implement the scheme as soon as possible due to the upcoming festival Diwali and the implementation will benefit the common man.
In the wake of COVID-19 and the consequences of lockdown, the Reserve Bank of India issued a circular on March 27 that allowed financial institutions to grant a moratorium on payment of instalments of term loans falling due between March 1, 2020, and May 31, 2020, for three months, but as the lockdown extended so the RBI had extended the moratorium till August 2020.
