On loan moratorium interest, Modi govt asks Supreme Court 'not to interfere in fiscal policy'
New Delhi | Jagran News Desk: The Narendra Modi government has informed the Supreme Court that it can't give more relief to various sectors on loan moratorium interest and asked the top court not to "interfere in fiscal policy" matters. In its affidavit filed before the apex court, the Modi government said, "Policy is the domain of the government and court should not go into sector-specific financial relief. Any further relief, besides waiving of compound interest for loans up to Rs 2 crore, is detrimental to the national economy and banking sector."
Last week, the Modi government had told the Supreme Court that it has taken a decision to waive compound interest on repayment of loans up to Rs 2 crore during the six-month moratorium period granted in wake of the COVID-19 pandemic.
The top court found the Centre's response was not satisfactory and asked it to file a fresh affidavit on the issue and posted the matter for next hearing on October 13. The apex court had also asked the Centre and the RBI to place on record the KV Kamath committee recommendation on debt restructuring due to COVID-19 related stress on various sectors as also the notifications and circulars issued by them so far on the issue of loan moratorium.
The Kamath panel had made recommendations for 26 sectors that could be factored by lending institutions while finalizing loan resolution plans and had said that banks could adopt a graded approach based on the severity of the coronavirus pandemic in a sector.
The court had asked the government to consider the concerns raised by the real estate and power producers in the fresh affidavit. In response, the centre has told the court that it has already announced a financial package and can't give more relief to various sectors.
Posted By: Shashikant Sharma