Interest on loans in moratorium: SC seeks Centre’s stand

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TheSupreme Court(SC) on Wednesday took exception to the Central government’s refusal to take an independent stance regarding levy of interest by banks on loans in moratorium even after Reserve Bank of India (RBI) had announced the relief on borrowings between March and August owing to the coronavirus disease (Covid-19) outbreak.

An apex court bench, headed by Justice Ashok Bhushan, said that plight of people due to Covid-19 and the resultant nationwide lockdown restrictions should be considered by the Central government while taking a call on the issue and ordered the government to file a separate affidavit.

The SC gave its order after solicitor-general (S-G) Tushar Mehta told the apex court that its stance on the matter is the same as that of RBI.

Earlier in June, RBI had filed an affidavit before the SC stating that it would not support the move to waive off interest, as it could affect the financial viability of banks.

“You should make your stand clear instead of relying on RBI,” Justice MR Shah, who was part of the bench, told Mehta.

“Government of India has ample powers under the Disaster Management Act, 2005, to take a decision. You should clarify two issues: whether interest can be charged and whe

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