[RBI loan moratorium] File additional affidavits on sectoral relief; place Kamath Committee report on record: Supreme Court to Centre, RBI

The Supreme Court today granted the Central government and the Reserve Bank of India (RBI) time to file affidavits detailing the steps to be taken for the enforcement of the recommendations made on waiver of compound interest for small borrowers..The Bench of Justices Ashok Bhushan, R Subhash Reddy and MR Shah also asked the Centre and the RBI to reveal the steps that will be taken to address concerns pertaining to sectoral relief raised by power producers and real estate associations, who are among the petitioners before the Court..The matter was taken up for hearing today after the Centre recently filed an affidavit agreeing to waive compound interest for small loans of up to Rs. 2 crore. Senior Advocate Kapil Sibal, appearing for a real estate association, told the Court that the affidavit did not address these associations. He said that the Centre's reply contains figures that need to be countered, for which time was needed.Sibal was instructed by a team of lawyers from DSK Legal comprising Advocates Shivani Khanwilkar, Saloni Shah, Manhar Singh Saini and Samit Shukla..RBI loan moratorium: Centre agrees to "handhold small borrowers", waive compounded interest for loans of up to Rs 2 crore.The Centre's affidavit filed on Friday, October 2 eliminates industries like real-estate associations and power producers from consideration, Senior Advocate Aryama Sundaram told the Court..Moreover, the petitioners argued that the Kamath Committee report has not been placed on record. This Committee was formed by the RBI for considering issues concerning interest waiver during the moratorium period, and had dealt with various sectors and their grievances..The Court thus asked the RBI and the Centre to place the report on record. Solicitor General Tushar Mehta and Senior Advocate V Giri assured the Court that the same will be done..The parties have been granted time to file their replies to the Centre's affidavit, while additional affidavits have been sought from the Centre and the RBI..Senior Counsel Harish Salve, representing the Indian Banks' Association (IBA), argued that the delay is damaging the banks. He pointed out that the Centre has adopted a two-pronged approach in giving relief to small borrowers and there is a sectoral approach contemplated by the Kamath Committee..The Court will take up the matter for hearing next on October 13..The Court was hearing a batch of petitions that had originally contested the interest component of the RBI's circular allowing grant of moratorium on repayment of term loans in light of the COVID-19 pandemic. During the course of the hearing, the issue evolved into the waiver of interest on interest and not an entire waiver on interest on term loans..In its affidavit filed recently, the Centre said that it will waive compound interest on personal and small loans of up to Rs. 2 crore for the six-month loan moratorium period introduced in light of the COVID-19 pandemic..Read Order: