In a relief to loan borrowers, the Supreme Court on Thursday passed an interim order saying that the accounts not declared as non-performing asset (NPA) as on 31 August should not be declared as NPAs till further notice. SC also said that the lender also must not take action against borrowers which is coercive.
"We have to protect them," Justice Ashok Bhushan, Bar & Bench reported. The six-month moratorium period ended on August 31. SC adjourned the hearing in the case to September 10 at 10.30 AM.
Earlier the apex court said that moratorium and penal interest cannot go together. The Supreme apex court was hearing a batch of petitions seeking extension of loan moratorium and interest waiver on loan granted by Reserve Bank of India (RBI). The three-judge bench of justices Ashok Bhushan, R Subhash Reddy and MR Shah is hearing a batch of pleas seeking interest waiver on loan moratorium granted by the RBI.
Appearing on behalf of the government, Solicitor General Tushar Mehta told the judges that although everyone is affected by the COVID-19-related economic disruptions, the impact is different for every sector. He stated that the pandemic has benefited sectors such as IT, and pharma etc.
On Tuesday, the Centre and the RBI informed the Supreme Court that the moratorium on repayment of loans must be extendable to two years under certain conditions. And, the sectors most distressed by the economic slowdown are being identified.