Supreme Court to hear PIL over financial stress to borrowers due to Covid-19

By LE Desk

New Delhi, May 24: The Supreme Court will on Monday hear a Public Interest Litigation (PIL) on the financial stress faced by borrowers during Covid-19 time. The PIL has been filed by a lawyer Vishal Tiwari and seeks directions to the Centre to take measures to overcome the financial stress.

The petition will be heard by a two-judge vacation bench of Justices Ashok Bhushan and MR Shah.

The PIL sought direction to the Centre to permit all the lending (financial) institutions to grant interest-free moratorium period for term loan and defer the payment of loan instalments for a period of six months or till the situation from Covid-19 normalises, the Hindustan Times reported.

It has also sought a direction from the Centre to banks and other financial institutions to not take strict action against the property of a borrower for six months, citing the tough lives of daily wage earners which has been affected by lockdown-like measures imposed due to the pandemic.

“Their financial burden should be decreased and citizens should not lose their dignity. Financial policies are made by the government but in the present time above financial policies, the question is of survival. And the population of our nation should survive with dignity and without any stress,” the petitioner said in his plea.

In March this year, the Supreme Court ordered banks against charging borrowers any penal interest or compound interest (interest on interest) on loans during the moratorium on repayment of loans from March to August 2020 in view of the Covid-19 pandemic.

It rejected a request by individuals and traders’ associations for waiver of complete interest during the moratorium.

The court clarified any penal interest or compound interest charged by banks for non-payment of any loan amount during moratorium shall be refundable. And if the bank is not in a position to refund, the same shall be adjusted in the loan amount, it added.

The bench said decisions on economic policy matters should be left to the government and courts should not interfere even if a second view is possible.

https://www.hindustantimes.com/india-news/supreme-court-to-hear-pil-over-financial-stress-to-borrowers-due-to-covid19-101621819972118.html