On October 2, the Centre Government said in affidavit to waive the compound interest (interest on interest) of loan borrowers up to 2 crore, which includes all the individual loan borrowers as well as Micro, Small and medium enterprises for the six month Moratorium period.
As per the reports of Times of India, this affidavit pronounced by the centre was discontented by the big borrowers and industrial sector.
In this concern, Kapil Sibal, CA Sundaram and Rakesh Dwivedi, who represented the big borrowers and industrial sector said, there was no relief for their clients and the Government has not considered the suggestions of the Kamath Committee for re-organising the big borrowers or corporate loans.
The Supreme Court has asked the Central Government and RBI to present the recommendations of the Kamath Committee in the record. The committee has made several recommendations regarding restructuring of debt due to the financial problems in the sector in view of Covid 19.
Since then, the RBI and the central government have issued various notifications and circulars ranging from loan moratorium. The Supreme Court said that all the decisions and circular details should be presented in the record.
In this concern, a SC bench Justices, Ashok Bhushan, R S Reddy and M R Shah said, “In affidavit by centre, there was nothing beside for individual borrowers, who have taken loan up to 2 crore and Kamath Committee recommendation must be placed in records, and we are firmly registering all the applicants and penalist. We are attempting to have balanced solutions.”
Tushar Mehta, Solicitor General, who presented the government said that the Kamath committee suggestions report comes in public domain so he would place a record and there is nothing to hide it.
Senior Advocate V Giri, who appeared for the RBI, said some discussions have taken place at the highest level and the government has been deliberating upon it.
To that Justice Bhushan Said, “It is not about the recording the committee recommendations, it’s about the suggestion that have been executed so that the RBI and the centre should issue the circular regarding the benefits that are extented.”
Harish Salve, the senior advocate representing Indian Bank Association said, “deferment of the decision can harm the banks.”
All the conclusions and circulars concerned for the matter will be submitted to the top court in the next hearing, which is scheduled on 13th October.