India

Supreme Court refuses to entertain plea for moratorium on loan repayment by pre-schools

By PTI

New Delhi: The Supreme Court on Friday refused to entertain a plea seeking a direction to the Center and the RBI to give an “interest free moratorium period for term loans” to those running playschools and pay their EMIs till then. To be postponed until the corona situation subsides.

However, a bench of Justices L Nageswara Rao and BR Gavai granted liberty to the petitioner to approach RBI with his representation “How can the court grant the relief you are seeking in this petition. You represent a Which they will decide but don’t file such petitions. It is not within the purview of this court to grant what you are seeking and the exemption you seek.

On this occasion, advocate Rohit Pandey, appearing for the petitioner, sought liberty to approach the Reserve Bank of India (RBI) with his representation.

The top court then granted liberty to the petitioner to approach the RBI.

“We would not like to entertain this writ petition. However, the petitioner has been given liberty to approach the RBI, which may decide the representation as appropriate in accordance with law,” the bench said.

The top court was hearing a petition filed by The Indian Council of Early Childhood Educators and Institutions (ICECEI) in which professional individuals, as members of groups, pre and play schools, had sought a direction that Loans taken by such institutions should not be declared non-declared. Performing Assets (NPA) due to non-payment of EMIs during the second wave.

The petition states that like regular schools, they are not earning money by giving online education to the children.

“The present writ petition has been filed to enforce the fundamental rights, especially the right to livelihood and the right to dignity, which are effective to try and remove the financial stress and hardship faced by the pre-schools. and by directing to take remedial measures enshrined under Article 21 such as new loan moratorium during the second wave of COVID-19 across the country, extension of time period under the restructuring scheme and temporary moratorium on declaration of NPAs by financial banks ,” the petition said.

Unlike other schools, which are in online education mode, these institutions cannot provide education to children through such mediums and hence, have become unable to earn, it said.

The petition, filed through ICECEI chairman Yashpal Singh, referred to the RBI notifications issued last year by which the borrowers were given the relief of suspension of monthly loan installment.

“The Central Government and its Ministries along with the Reserve Bank of India have failed to provide any such relief in this present situation to all the stressed sectors and persons for whom the question of livelihood and survival is concerned,” the petition said.

The second wave of COVID-19 has rocked the health care and financial system, it said, prompting the government to grant interest-free moratorium periods for term loans to lending institutions and payment of loan installments to a period of six. be asked to allow adjournment for For months or until the situation with COVID-19 returns to normal.

“Issue writ to ensure that all the lending institutions keep the most recent 16 months of loan repayment track, credit score and credit report while scrutinizing/processing the loan application or extending any grant/relief package issued by the respondent centre. Not to be taken into account. For the benefit of pre/playschools,” it said.

The plea has also sought a direction that the financial institutions shall not proceed for auction of respectable property of any citizen or person or party or any body corporate for a period of two years.

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