Does the RBI circular issued on 27.03.2020 giving liberty to all banks to allow moratorium of three months on payment of instalments in respect of all term loans outstanding as on 01.03.2020 applies to Non Banking Financial Companies?
Indiabulls Commercial Credit Limited knocked Delhi High Court's door after it received payment of loan installment demand from Small Industries Development Bank of India (SIDBI).
The contention of Indiabulls was that such demand cannot be accepted in light of the moratorium imposed by the Reserve Bank of India by circular dated 27/03/2020.
CASE DETAILS
Indiabulls had entered into a loan agreement with SIDBI and the later had agreed to disburse a loan amount not exceeding ₹750 crores to and pursuant thereto disbursed a sum of ₹575 crores to it.
The loan installement of March was duely paid. As everyone is well awared that the COVID-19 pandemic broke out afterwards and concerning to it RBI in order to give temporary relief to the borrowers all across the country, on 27.03.2020 issued a circular giving liberty to all banks to allow moratorium of three months on payment of instalments in respect of all term loans outstanding as on 01.03.2020, subject to the borrower making the said request.
The contention of the petitioner was that despite it, SIDBI / respondant no. 1 raised demand towards loan installment due in April.
Thus the Petitioner made a representation before SIDBI, seeking relief under the aforesaid circular issued by the RBI, to which SIDBI replied that it has to clarify with the RBI as to whether the said moratorium applies to Non Banking Financial Companies (NBFC) also.
SIDBI via its Learned Counsel submitted that it was still awaiting necessary clarification from RBI, and that it has already received the payment from the Petitioner towards the instalment due in April, 2020.
It was further submitted that SIDBI is taking expeditious steps to get the necessary clarification from Central Bank.
In view of this, therefore it was assured to Indiabulls that in any event, even if the demand from the next month is raised in due course, it will not be treated as a defaulter, till SIDBI obtains clarification.
It was submitted by SIDBI that no such information of the petitioner being an alleged defaulter will be given to any credit rating agency.
In light of these submissions, the Single Bench of Justice Rekha Palli disposed off the petition.
The Court clarified that SIDBI will not raise any further demand on the Petitioner towards the due instalments against it till it obtains a clarification from RBI.
It was observed:
The order was issued by Justice Rekha Palli on 09-04-2020.
Read Order Here:
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