The Supreme Court on Monday asked the Centre and the Reserve Bank of India about the steps taken to implement the KV Kamath Committee report on recommendations to bail out sectors affected by the Covid-19 stress.
A Bench, led by Justice Ashok Bhushan, noted that an additional affidavit filed by the government last week did not address “several issues” raised in the writ petitions highlighting the plight of borrowers, small and big, who are being charged compound interest for the six-month loan moratorium that ended on August 31.
The affidavit had informed the court about the government’s decision to “hand-hold” small and vulnerable borrowers and waive the interest on interest accumulated against their loans during the moratorium period. But the waiver will be applicable only for loans up to ₹2 crore, the Finance Ministry told the court.
During the hearing, the court asked the government if it had so far issued any circulars, policy decisions, etc., based on the Kamath report. The report has suggested a loan restructuring scheme for 26 pandemic-distressed sectors.
The court said the government and the RBI have not brought anything on record to show what has been done to implement the Kamath Committee report. At one point, Justice Bhushan asked why the report itself had not been placed on record in the court.
“We have nothing to hide. We will put it on record. It (the report) is available in the public domain,” Solicitor-General Tushar Mehta, appearing for the government and the RBI, replied.
Senior advocate V. Giri, also for the RBI, said the government is deliberating on improvements to the loan resolution plans. He assured the court that the Kamath report would be placed on record.
The court said it was not just about placing the report on record, but implementing it. The RBI and the government should issue circulars so that people know the benefits extended to them.
“It will be done,” the government and RBI sides responded.
“When will it be done? …This has been going on for long. There is a need for proper restructuring scheme,” Justice MR Shah said.
The court found there was no resolution or policy decision by individual banks on how they should implement the decisions taken by the Centre and the RBI.
Senior advocate Harish Salve, appearing for the Indian Banks’ Association, sought time to place on record the policy decisions of each bank. “Whatever the relief, the weight of it will fall on the banks,” Salve said.
“We are trying to strike a balance here,” Justice Shah observed.
The court allowed the parties to file replies to the additional affidavit in a week.
The Centre has to place on record the Kamath report along with circulars, policy decisions, if any, on the issue.
The court scheduled the next hearing on October 13.