The center said RBI has presented a plan to extend the moratorium up to two years.
Waiving interest on EMIs and interest on interest during the loan default period would be contrary to “basic finance royalties” and unfair to those who repaid loans as scheduled, the Center told the Supreme Court on Tuesday. The Finance Ministry filed an affidavit on Tuesday after the high court, hearing a petition on the matter, asked the Center and the Reserve Bank of India (RBI) to review the measure to charge interest during the period of moratorium.
The government said that any “post facto” change in interest payments to the RBI’s moratorium scheme would be unfair to those who continued to pay their EMI.
“I respectfully declare and present that an ex post facto change in the terms and conditions of the moratorium offer that favors those who availed themselves of it over those who made the additional effort to pay as scheduled would be extremely unfair and clearly unfair to those who did so. they made. It did not initially take advantage of the benefits of the moratorium or it later abandoned it, ”says the Center’s affidavit.
In the affidavit, the Center also said that the RBI has presented a scheme that provides for the extension of the moratorium for two years to certain borrowers. Referring to RBI’s Aug. 6 circular, the Center also listed a number of measures aimed at providing relief to stressed borrowers. The affidavit mentioned that the central bank circular provides for “extension of the residual term of the loan, with or without moratorium, for up to two years, waiving interest and criminal charges”, rescheduling the payment, converting the accumulated interest into a new loan with a Schedule of deferred payments and additional loan sanction “.
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