New Delhi: The Supreme Court of India asked the government for the need to wait till November 15 for implementing a scheme for waiving the compound interest.
The waiver scheme is supposed to “hand-hold small and vulnerable borrowers” for those fortunes dropped down due to the lockdown.
The court told the government “Their Deepavali is in your hands.”
The waiver scheme has been proposed for eight different categories, including MSME, education, housing, consumer durables, credit card, auto, personal and consumer loans.
Justice Ashok Bhushan asked Solicitor General Tushar Mehta, who appeared for the Centre and the RBI, “Having taken the decision to waive their compound interest for the moratorium period, our only question to you is why do you require a month [till November 15] to bring this scheme into effect? Why do you delay issuing the circular?,” was quoted as saying by The Hindu.
Justice M.R. Shah, who was also on the Bench, asked Mehta to consider the difficulty faced by the common man.
“In his mind, the government has already helped him [with the waiver of compound interest]… Now he wants concrete results. When you have already taken a decision, why do you need one month just to issue a circular,” Justice Shah asked.
On this, Mehta replied that the scheme itself was the proof of the government’s concern for the common man.
Mehta said, “We have already considered the plight of the common man. That is why we have brought this scheme… We would not gain anything by delaying it. There are complexities involved. November 15 is the outer limit.”
Mehta stated, “certain modalities need to be worked out.”
Justice Bhushan further stated, “Modalities will take a month? If you had issued a circular to the banks, they would have taken steps… Till now you have not. You have only told the court.”
Senior advocate Harish Salve who appeared for the Indian Banks Association assured the Bench, also comprising Justice R. Subhash Reddy, that the scheme would be “worked out and done”.
He said, “It has to be done. Everything the government has said on affidavit has to be done. There is no question about it.” He further said the process would take a month which will be necessary as because there were a large number of borrowers under the ₹2 crore category.
Mehta said that the calculation of the interest may also vary.