New Delhi: The Supreme Court on Tuesday directed the Reserve bank of India to furnish details of the borrowers, who have defaulted on loans of over Rs 500 crores.
A three-judge bench comprising Chief Justice T.S. Thakur, and Justices R. Banumathi and U.U. Lalit hearing a writ petition filed by Centre for Public Interest Litigation wanted to know from RBI the quantum of bad loans written off by the commercial banks.
When the CJI asked the solicitor-general Ranjit Kumar whether the government was writing off bad loans, the SG said “We are taking action.
The government is not thinking of writing them off. We are not willing to advance more money (to defaulters). So people are saying that we are not doing anything for the economy.” The SG, however, said that Rs 70,000 crore had been written off in the last three years alone.
The CJI observed “Thousands of crores are owed to public financial institutions, including state-owned banks, while the promoters are enjoying. These are government banks. Isn’t it a fraud on the people that you keep lending and keep writing it off?”
The CJI then demanded a list of all major defaulters of bank loans. “These are big people running big empires. Why shouldn’t the RBI disclose this information to the public?”
The CJI was responding to counsel Prashant Bhushan’s allegations that RBI was negligent on this score. The CJI also sought to know what writing off entailed: “Does it mean that you write off and let the company go scot-free.”
But the SG said that assets of the company are first sold off and loans recovered to the extent possible. What cannot be recovered is placed in a separate head to ensure that the bank’s books don’t look bad as it affects their share valuation, he said.
