Top Court To Hear Fresh Plea On Extension Of Loan Moratorium Till Year-End

The Supreme Court (SC) on Friday said that it will hear a fresh plea seeking extension of the Reserve Bank of India's (RBI) moratorium scheme till December this year. Under the scheme, which ends on 31 August, the RBI in March had given the facility of deferred payment of installments of term loan borrowers. Vishal Tiwari, the lawyer who had filed the plea told the 3-judge bench, headed by Justice Ashok Bhushan  that the adverse impact of the pandemic over financial situation was still there and hence, the moratorium scheme needed to be extended further till year end. Now, the plea will be heard alongside the one filed by Agra resident Gajendra Sharma which is scheduled for hearing on September 1.

The top court on August 26 had heard Mr Sharma's plea and had observed that the Centre was “hiding behind the RBI” and had asked it to reply within a week on the issue of interest being charged on instalments which have been deferred under the central bank's scheme during the moratorium period amid COVID-19 lockdown. In this regard, the top court has asked the government to make its stand clear by September 1. The court said the centre had not clarified its stand even though it has "ample powers" under the Disaster Management Act to grant the waiver.

Mr Sharma has sought a direction to declare the portion of the RBI's March 27 notification "as ultra vires to the extent it charges interest on the loan amount during the moratorium period and said that it created hardship to the petitioner being borrower and creates hindrance and obstruction in ''right to life'' guaranteed by Article 21 of the Constitution of India".