Supreme Court extends interim order on loan moratorium till 28 September

Guwahati: The Supreme Court on Thursday virtually extended the loan repayment moratorium till September 28 and directed banks not to declare any loan as NPA (non-performing asset) due to non-payment of installments during the period.

Following the nation-wide lockdown which was imposed In March to curb the spread of the Coronavirus pandemic, the Reserve Bank of India had given the facility of deferred payment of installments to borrowers and the scheme had ended on August 31.

The apex court adjourned the case for the last time, granting the Centre, Reserve Bank of India (RBI) and banks two weeks to work together and file a concrete reply on their stand on waiving of interest charged during the moratorium period.

Earlier, the apex court urged the Centre and the Reserve Bank of India (RBI) to review the move to charge interest on EMIs during the moratorium period introduced under the scheme due to the Covid-19 pandemic.

As per reports, the top court had stated there was "no merit in charging interest on interest" for deferred loan payment installments during the moratorium period announced in wake of the Covid-19 pandemic.

Appearing for a set of borrowers, Rajeev Dutta, senior advocate told the court that compound interest is still being charged in loan cases. "Where is the relief? Loans being restructured, that should have been done earlier," he said.

Notably, Senior advocate Dutta also added "Lakhs of people are in hospitals for their sufferings, lot of people have lost their sources of income. Central government should make their stand clear, decide on relief on the issue of moratorium and waiving of interest on interest and others if it felt so," 

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