Loan moratorium extendable as much as two years, Centre tells SC


Satya Prakash

Tribune News Service

New Delhi, September 1

Amid uncertainty over mortgage compensation moratorium scheme that ended on August 31, the Centre and RBI on Tuesday instructed the Supreme Court that it was extendable as much as two years.

Solicitor General Tushar Mehta, nevertheless, instructed a Bench led by Justice Ashok Bhushan that no formal choice had been taken on this regard.

Matter of debate 

  • Loan moratorium is a authorized authorisation to debtors to postpone the cost of EMIs
  • However, curiosity charged by banks on deferred EMIs stirred a row
  • Petitions had been filed within the SC demanding waiver of curiosity, or waiver of curiosity on curiosity on the suspended EMIs

On behalf of the Centre and RBI, Mehta stated a recent affidavit had been filed within the high courtroom on the problem. “We are in the process of identifying the distressed sectors to vary benefits as per the impact of hit they have taken,” he stated.

“Please let the Centre, RBI and bankers’ association put their heads together,” Mehta submitted. Noting that the financial system had contracted by 23% resulting from Covid-19, he stated a number of steps had been taken for pressured sectors. The high courtroom — which is seized of petitions demanding waiver of curiosity, or waiver of curiosity on curiosity on the suspended EMIs throughout moratorium — had earlier commented that there was no level in charging curiosity on curiosity. Maintaining that the matter can’t be delayed any additional, the Bench posted it for additional listening to on Wednesday.

Announced in March for 3 months, mortgage moratorium was prolonged to 6 months until August 31.

The Centre and RBI maintained {that a} full curiosity waiver was not potential as banks too needed to pay curiosity to depositors.



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