The Supreme Court will hold a hearing on Friday (October 28) on whether the names of individuals and companies with non-performing assets (NPAs) of Rs 500 crore or more could be made public.
A bench of Chief Justice T.S. Thakur, Justice D.Y. Chandrachud and Justice L. Nageswara Rao on Monday decided to hold a hearing on the limited point as counsel for NGO Centre for Public Interest Litigation (CPIL) Prashant Bhushan urged the bench to make public the list of the defaulters submitted by the Reserve Bank of India in a sealed cover.
Bhushan told the bench that since the apex bank was covered under the Right to Information Act, the list of defaulters with NPAs of Rs 500 crore or more should be disclosed
RBI has opposed making the names of the defaulters public.
The apex bank has cited the Section 45E of the Reserve Bank of India Act that prohibits disclosure of any information relating to the creditors. It says “(1) Any credit information contained in any statement submitted by a banking company under section 45C or furnished by the Bank to any banking company under section 45D, shall be treated as confidential and shall not, except for the purposes of this Chapter, be published or otherwise disclosed.”
The court had earlier on April 12 said that it would examine whether the Reserve Bank of India and the Centre could take shelter behind the confidentiality clause in the RBI Act and other statutes for holding back the names of defaulters of loans and also the total quantum of money that is in default.
The top court had noted on April 12 that rich people take loans for running their empires and on their failure to repay them they go for restructuring by Board for Industrial and Financial Reconstruction (BIFR) while farmers are committing suicide for their inability to pay small loans.
The RBI had furnished the names of the defaulters in pursuance to the top court’s February 16 order asking the Reserve Bank of India to furnish a list of the companies which are in default of loans by the banks and financial institutions in excess of Rs 500 crore or whose loans have been restructured under corporate debts restructuring scheme.
The court had sought details from the RBI following a media report that said that during the year 2015 loans advanced to private parties that were written off are in the range of nearly Rs 40,000 crore. The court had further noted that from the same media “it appears that top ten banks have in the last three financial years written off loans of more than Rs 80,000 crore as bad debts”.