‘Don’t hide behind RBI’: SC slams govt on interest issue

NEW DELHI: The Supreme Court on Wednesday took exception to the Centre’s reluctance to clarify its stand regarding levy of interest by banks on loans and charging interest on such interest during the moratorium period afforded for loans by the Reserve Bank of India (RBI) from March to August in view of the coronavirus disease (Covid -19) pandemic.

“The problem was created by your lockdown. Now you cannot look into business (of banks) alone. You should make your stand clear instead of hiding behind RBI,” a three-judge bench headed by justice Ashok Bhushan said after solicitor general Tushar Mehta told the court that the Centre’s stance is the same as that of RBI.

Earlier in June, RBI had filed an affidavit before the SC stating that it would not support the move to waive off interest as it could affect the financial viability of banks.

The court adjourned the matter for further hearing on September 1 prior to which the Centre has to file its response.