NEW DELHI: The Supreme Court on Tuesday formally issued notices to the Centre and RBI on a plea seeking interest waiver on loans during the period of the moratorium announced by the central bank in view of COVID-19 lockdown.
Announced by RBI in March for three months, the loan moratorium is a legal authorisation to debtors to postpone payment of EMIs. It has now been extended to six months till August 31, 2020.
A Bench headed by Justice Ashok Bhushan — which had earlier asked Solicitor General Tushar Mehta to seek instruction in the matter — chose to issue formal notices after being informed that the responses were yet to come.
It asked the Centre and RBI to respond in a week to the petition filed by Gajendra Sharma
On behalf of Sharma, senior coulsel Rajiv Dutta submitted that at a time when COVID-19 lockdown was in place, charging of interest on the loan despite moratorium announced by RBI was causing lots of hardships to borrowers.
Terming it a violation of right to life guaranteed under Article 21 of the Constitution, the petitioner said, “Charging interest during the moratorium period is completely devastating, wrong and in a way has taken away the benefit of imposing moratorium.”
Earlier, the top court had asked the RBI to examine if benefits of its policy decisions were being passed on to borrowers.
“It appears that whatever benefits are being given by RBI, they are not being extended to the borrowers. There should be proper guidelines,” it had said.
However, it refused to interfere in the matter as the petitioner in that case was not a borrower.