Even as a clutch of industries, including the real estate sector, clung to their plea for more substantive loan relief from banks in the wake of the pandemic, the Supreme Court on Wednesday seemed to acknowledge the stand of the government, Reserve Bank of India (RBI) and banks that they were hard-pressed and would rather tread the prudent path.
“The government has to arrange its affairs (on the basis of) its economic capacity,” Justice Ashok Bhushan remarked, as senior advocate Kapil Sibal, appearing for realtors’ body CREDAI, insisted, “the government has done nothing, but has relied upon the RBI circular (on debt restructuring)”.
“Eligible borrowers’ accounts should continue to be classified as ‘standard”, Sibal said, adding that the Kamath Committee was set up to by RBI regulate parameters between the borrowers and lenders, and “it has nothing to do with the Covid-19 disaster.” The three-member Bench adjourned the case to Thursday, when it will also hear the Solicitor General.
Senior advocate Ravindra Srivastava, arguing for another industry group, said it was “arbitrary” on the part of the Centre to classify borrowers as “small and big”, as it extended compound interest relief for loans up to Rs 2 crore only for the six-month moratorium period. —FE
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