The judges are not financial experts, the Supreme Court noted on Friday, refusing to accept a petition demanding a moratorium on loan repayments similar to the one held by the court last year during the first wave of the Covid-19 pandemic.
Leaving the decision to the Center and the Reserve Bank of India (RBI), the panel of judges Ashok Bhushan and M.R. Shah said, “We are not experts in financial matters and matters with financial implications.” The court considered a petition filed by attorney Vishal Tiwari, who sought remedial measures to rectify and overcome the financial stress and hardships faced by small borrowers across the country.
Citing the second wave of the Covid-19 pandemic, Tiwari told the Court that more people have lost their jobs during the current wave of the pandemic and the attendant isolation that has affected middle-class families. The court referred to a circular issued by RBI on May 5, which referred to the resolution of Covid-19 stress for micro, small and medium-sized enterprises (MSME).
Tiwari said the circular did not pay enough attention to the hardships of small borrowers. The court stated: “Financial assistance and other measures are within the purview of the government and are mainly related to political issues.” The judges noted: “We cannot tell them when the government is already spending money on the purchase of vaccines to work with migrant workers.”
A similar issue was dealt with last year by a higher court in a motion filed by Agra resident Gajendra Sharma. He pushed for the waiver of interest during the RBI moratorium, which ran from March to August last year. It was at the urging of the Court that the Center and RBI addressed the plight of small borrowers and decided to abandon compound interest rates called “interest rates.” This was provided to individuals and MSMEs who took out loans or had credit card payments before ₹2 crores.
But in this case, the panel noted: “All the issues raised are political issues, and the Union of India and the Reserve Bank of India must consider and make an appropriate decision.” Tiwari went to court with a request to prohibit banks from evicting or auctioning due to non-repayment of loan payments. The court refused, stating: “No general order can be passed against an auction or eviction.”