Loan Moratorium : Supreme Court Refuses To Entertain Plea Seeking Counting Of 90 Days For NPA Declaration From March 23 Judgment

The Supreme Court on Friday refused to entertain a plea seeking clarification and modification of its 23rd March 2021 judgement whereby it vacated the stay on declaration of loan accounts as Non-Performing Assets.

A bench comprising Justice DY Chandrachud and Justice MR Shah was hearing an application filed by Advocate Vishal Tiwari seeking a clarification that the period of declaring any account as NPA shall be reckoned from the date of the above judgement (March 23).

The bench told Advocate Tiwari that the relief cannot be sought through a Miscellaneous Application(MA) filed in the earlier case.

"An MA is fiked when you want some correction. What you have filed is a substantive relief. We will not entertain this", Justice Chandrachud said.

Following this, the petitioner sought liberty to withdraw the application. Accordingly, the application was dismissed as withdrawn.

While disposing of the petitions through judgment dated March 23rd 2021, the apex court lifted the restriction on the declaration of accounts as NPA. The Court had also observed that "We are of the opinion that there shall not be any charge of interest on interest/compound-interest/penal interest for the period during the moratorium from any of the borrowers and whatever the amount is recovered by way of interest on interest/compound interest/penal interest for the period during the moratorium, the same shall be refunded."

The applicant has stated that as order of non-imposition of NPA by the banks against the borrowers has been vacated through the judgement dated 23rd March 2021, the banks in accordance to the law can impose NPA of a standard account if there arises default.

Therefore, according to the applicant, it needs to be clarified and directed that the period of 90 days for the computation of declaration of standard account as Non-Performing Asset should start from the day of Supreme Court's judgement on 23rd March 2021.