Tuesday, October 25th, 2016

SC to RBI: Why can’t 57 names that owe Rs.85k-cr to banks be made public?

Narada Desk | October 25, 2016 9:18 am Print
The RBI pleaded that making the list public was against banking laws under which financial institutions could not disclose the assets and liabilities of their clients.
Reserve Bank of India

The Supreme Court of India on Monday asked the Reserve Bank of India (RBI) why a list of 57 individuals that owe a whopping Rs 85,000 crore to public sector banks (PSB) can’t be made public. The court was hearing on a plea for making public the list of business houses that had defaulted on repayment of bank loans exceeding Rs 500 crore each.

A bench headed by Chief Justice T S Thakur asked, “Who are these people who have borrowed money and are not paying back? Why this fact that the person has borrowed money and not paying back be not known to public,” The Hindu reported.

“See this amount…if we had asked for details of those who owe Rs 100 crore, this could be another Rs 1 lakh crore…why should we not put the names of these defaulters in public domain? The RBI publishes a list of wilful defaulters every year. It does not matter whether they are wilful defaulters or not but they certainly owe Rs 500 crore and more to the banks… people may have a right to know,” said the bench.

Appearing for NGO Centre for Public Interest Litigation that had filed a PIL on bad loans, senior counsel Prashant Bhushan pleaded for disclosure of the names of defaulters, arguing that the RBI was covered under the Right to Information (RTI) Act.

The RBI, however, was against any such move. It pleaded that making the list public was against banking laws under which financial institutions could not disclose the assets and liabilities of their clients.

The bench set the deadline after going through the list submitted by RBI in a sealed cover. The SC asked the RBI to submit by Friday why the names of these defaulters should not be made public.

Appearing for the government, Solicitor General Ranjit Kumar informed the bench that on May 5, 2016, the Centre constituted a six-member committee to look into non-performing assets of banks and financial institutions that will be submitted shortly.

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