Expose huge amounts owed by defaulters, SC tells RBI


New Delhi, Apr 12 (The Hindu) : If confidentiality prevents revealing the names, the Supreme Court on Tuesday said the RBI should atleast publicly expose the "huge and substantial amounts" owed by the rich who took bank loans above Rs. 500 crore and defaulted.

"People taking thousands of crores to run their empires and then later declare insolvency only to take more loans from other sources. This, when poor farmers are driven to suicide unable to pay their small debts," Chief Justice of India T.S. Thakur observed.

The Supreme Court said it would hold detailed hearings on whether confidentiality between banks and their rich customers would prevent itfrom passing a judicial order to reveal the details of the "very substantial debt amounts" of those who have taken over Rs. 500 crore loans from banks.

The Bench, also comprising Justice R. Banumathi, issues notice to the Indian Banks Association and the Ministry of Finance.

"We want you to formulate issues by April 26. We will have a focussed and articulate debate on these issues. Primary question is whether there is any confidentiality on information relating to outstanding debts over Rs. 500 crore," Chief Justice Thakur said.

The court is hearing a PIL filed by NGO Centre for Public Interest Litigation seeking full disclosure of names and details of those who have defaulted after taking over Rs. 500 crore loans.

The RBI had provided the list of defaulters to the court in a sealed cover.

"Can the total amounts in default be disclosed? We can keep the names of the defaulters confidential, but total amounts can be disclosed..." Chief Justice Thakur asked RBI.

RBI counsel responded that the information was obtained by it in a fiduciary capacity and any exposure will have an impact on the country's economy and reduce confidence within the business and investment sector.

"The amounts outstanding is very large... the next question we would ask is what steps are you taking to recover them... Also what about the status of non-performing assets?" CJI said.

RBI said any disclosure would be violative of the provisions of the RBI Act, Credit Information Companies ( Regulations) Act, 2005 and a 1983 law on fidelity and secrecy in public financial situations.

Representing the NGO, advocate Prashant Bhushan countered that there is no requirement for a cloak of secrecy to favour the defaulters. He submitted that a 2015 judgment of the Supreme Court has already favoured transparency rather secrecy.

Keywords: bad loans, non performing assets, RBI

 

  

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Comment on this article

  • Xavier, Udupi

    Tue, Apr 12 2016

    RBI was copied on basis of the Federal reserve in U.S. This Institution owned by the super rich and acts for the superrich facilitating superrich. so when RBI not cooperating and giving reasons of Business confidence its clear no action will be taken against superrich defaulters.

    DisAgree Agree [3] Reply Report Abuse

  • RAVINDRA, KARKALA

    Tue, Apr 12 2016

    Archaic law of Bank Secrecy need to be re-visited immediately. When small loan defaulter's name, photo addresses are published notice board of the Bank, why leniency for big loan defaulters.

    DisAgree Agree [3] Reply Report Abuse

  • Arun, Mangalore

    Tue, Apr 12 2016

    If it is case with any poor family next day these nationalized bank put their photo along with whole address on news paper.

    DisAgree [1] Agree [8] Reply Report Abuse

  • Jossey Saldanha, Mumbai

    Tue, Apr 12 2016

    Do uou have the guts to go to ENGLAND ...

    DisAgree [2] Agree [9] Reply Report Abuse

  • Rajju, DXB

    Tue, Apr 12 2016

    haaahaaa waiting for all Pappus reply

    DisAgree [6] Agree [4] Reply Report Abuse

  • Rajju, DXB

    Tue, Apr 12 2016

    yes all given by congress...

    DisAgree [7] Agree [5] Reply Report Abuse

  • SK, Mangalore

    Tue, Apr 12 2016

    so, what ???????????????????????
    childish comment .....it is the responsibility of the Banks to recover and NOT of any political party....If the managers fails to recover, punish them severely ....

    DisAgree [2] Agree [7] Reply Report Abuse

  • Suleman Beary, Udupi

    Tue, Apr 12 2016

    @Rajiv...
    Is this includes $1 Billion Adani loan?

    DisAgree [1] Agree [4] Reply Report Abuse

  • stan, dubai

    Tue, Apr 12 2016

    Kannada they say ADIKE KADDARE KALLA and Ane Kaddare Kalla. Rich people are kalla by ane kaddu but poor farmers are kalla by adike, our Bankers and Politicians are taking action only on adike..i.e. farmers because most of powerful and politicians are kalla by ane.

    DisAgree Agree [2] Reply Report Abuse

  • John, mangalore

    Tue, Apr 12 2016

    Rules and regulations are created by Rich and powerful people for poor people. We can fix them only during elections by not voting them.

    DisAgree [1] Agree [5] Reply Report Abuse

  • Stan, Udupi/ Dubai

    Tue, Apr 12 2016

    When the banks are raiding small time loan defaulters, what is the logic of keeping secrecy of big loan defaulters.Rich and powerful always escape the clutches of law by clinging to loopholes of the system.

    DisAgree Agree [18] Reply Report Abuse

  • REN, DUBAI

    Tue, Apr 12 2016

    Defaulters are defaulters. Must disclose their names. Non-disclosure will encourage others to follow the foot steps!!!!!!!!

    DisAgree Agree [13] Reply Report Abuse

  • Ravi, Kapu

    Tue, Apr 12 2016

    The rich people enjoy whereas the poor suffer...

    DisAgree Agree [15] Reply Report Abuse

  • Hussain, Abudhabi

    Tue, Apr 12 2016

    There's no difference between British era and rich people...Both looted and returned to London

    DisAgree Agree [27] Reply Report Abuse

  • CONRAD JOHN TAURO, SHIRVA/UDUPI/DUBAI

    Tue, Apr 12 2016

    March fast to England continues...

    DisAgree Agree [19] Reply Report Abuse


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Title: Expose huge amounts owed by defaulters, SC tells RBI



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