Taking a stern stand, on hearing the petitioner NGO, Centre for Public Interest Litigation, the Indian Supreme Court (SC) has asked Reserve Bank of India (RBI) to detail the steps taken to recover the payment from big players and corporate houses which had taken bank loans in excess of Rs. 500 crore and defaulted to the amount of lakhs and crores of rupees.
The banking regulator represented by Senior advocate Jaideep Gupta requested the court not to reveal the identity of big defaulters' and amounts owed by them individually or collectively as it would have a “telling adverse impact on the economy of the country“.
The court was unconvinced by the statements and said “You can keep the names of the defaulters confidential. But what is the harm in revealing the total defaulted amount? The concern is that lakhs of crores of rupees are outstanding against the big defaulters who individually owe more than Rs. 500 crore to banks”.
To ensure action against big defaulters, a bench of Chief Justice T S Thakur and Justice R Banumathi issued notices to the finance ministry and Indian Banks Association for their response.
Bench remarked “You are the watchdog of the banking sector. Why does it happen that some people take loans worth thousands of crores of rupees to set up companies, declare the companies sick and enjoy with public money. On the other hand, why are poor farmers harassed for repayment of a few thousand rupees they take as loan in distress and are made to suffer?“
RBI has recently provided Supreme Court defaulter list, with confidentiality rider. However, while submitting the list, the RBI said it was “extremely necessary” to keep these names confidential due to their “fiduciary relationship”. The Indian SC has taken exception to this specific rider.