"Situation Demands That Loan Moratorium Be Extended Till 31 March 2021": Plea In Supreme Court Seeks Extension

An amendment application for the prayers in the plea seeking directions to extend the moratorium period till March 31, 2021 has been filed in the Supreme Court.

The Supreme Court is currently seized of a batch of plea's and is hearing the issue of extension of loan moratorium and waiver of accruing interest.

One of the Petitioner(s) Advocate Vishal Tiwari has sought modification of the original prayers in the plea which related to extension of moratorium period up to December 31 stating that the current situation demands and necessitates that the moratorium shall be extended and granted up to March 31, 2021.

Further, the plea has sought directions to ensure that lending Institutions Shall not use any kind of illegal, Violent, threatening and harassing methods against borrowers for the recovery loan Instalments; And further Direct that in case such Acts are committed by the lending Institutions than Strict Action shall be taken against them in Accordance with law.

In this context, it is contended that 31st December 2020 is about to come and there is no change in the present pandemic situation. 

"The work and business of the people and different sectors have also been hit and is still under slump," states the plea and adds that many professionals like lawyers are still facing financial crisis as the courts are not functioning regularly. 

The plea further highlights that other sectors like tourism and transport Industry is also facing slump in their business as due to restrictions the people are avoiding travel and visiting places. "These sectors require more time to emerge from this financial crises. And in the present scenario they are not able to pay their monthly instalments to the lending Banks/NBFCs. Restructuring scheme introduced by the RBI is of no relief to the borrowers as the entire discretion has been given to the banks," it states.

On November 19, the Centre had urged a bench of Justices Ashok Bhushan, MR Shah and Subhash Reddy to not intervene and provide further relief to borrowers under Article 32 as the Government was already "on top of it".

Solicitor General Tushar Mehta told top Court today that many relief packages and schemes had been worked out with technical experts and the intervention of the Court in fiscal policy issues was uncalled for.

The bench disposed off the pleas wherein petitioners' were satisfied with the compound interest waiver. The bench is expected to hear the plea's today.