SC extends moratorium on loan repayment till Sep 28

New Delhi, Sep 10: The Supreme Court has extended the loan repayment moratorium until September 28. It also decided to continue with its interim order directing banks not to declare any loan as NPA because of non payment of instalments during the moratorium period that ended on August 31.

A bench of Justices Ashok Bhushan, Sanjay Kishan Kaul and M R Shah had said that these are challenging times and it is a serious issue as on one hand moratorium is granted and on other hand interest is charged on loans.

The bench was hearing a plea, filed by Gajendra Sharma, in which he has sought a direction to declare the portion of RBI's March 27 notification "as ultra vires to the extent it charges interest on the loan amount during the moratorium period, which create hardship to the petitioner being borrower and creates hindrance and obstruction in 'right to life' guaranteed by Article 21 of the Constitution of India".

Sharma, a resident of Agra, has also sought a direction to the government and the Reserve Bank of India (RBI) to provide relief in re-payment of loan by not charging interest during the moratorium period.