RBI says loan defaulters’ list cannot be made public, SC to take up matter in 4 weeks
RBI’s stand was in response to a demand made by the Centre for Public Interest litigation (CPIL) – an activist organisation – seeking disclosure of those who owe over Rs 500 crore to banks.india Updated: Jul 17, 2017 21:04 IST
The Reserve Bank of India (RBI) insisted on Monday that it cannot make public the list of big loan defaulters. The names have already been submitted to the Supreme Court in a sealed cover.
The RBI counsel told a bench headed by Chief Justice JS Khehar that disclosing the names could have an adverse impact on businesses.
“There are a series of statutes that can be looked into to decide whether the disclosure can be made,” the counsel told the bench, which asked the RBI to file an affidavit on the issue. The court will take up the matter after four weeks.
RBI’s stand was in response to a demand made by the Centre for Public Interest litigation (CPIL) – an activist organisation – seeking disclosure of those who owe over Rs 500 crore to banks.
The central bank was made a party in the public interest petition that was filed in 2003 where CPIL pointed out the bad loans advanced to a few companies by state-owned Housing and Urban Development Corp. Ltd. RBI was directed to provide a list of defaulters and expressed concern over rising bad loans.
The court wanted to know how state-owned banks and financial institutions were clearing large-scale loans without proper guidelines. It asked the RBI to spell out if there were guidelines to oversee advancing of such loans and whether there were adequate systems in place to recover them.
RBI gave several reasons for piling bad loans. Delays in securing government clearances, completing acquisition of land and poor credit appraisal and monitoring by banks were some of them.