Supreme Court asks Centre why loan defaulters’ names should not be public

Hindustan Times‎‎‎‎: New Delhi: Tuesday, October 25, 2016.

The Supreme Court questioned the Centre and Reserve Bank of India’s (RBI) policy to keep the names of defaulters a secret, saying it was in public interest to reveal these details.

“Who are the people who owe money over Rs 500 cr? How does it affect you?” a bench headed by Chief Justice TS Thakur asked solicitor general Ranjit Kumar, appearing for the Centre and the RBI counsel. It said a person seeking information regarding defaulters must be provided with the details under the Right to Information Act (RTI).

“People should know how much money a person has borrowed and how much money he needs to pay back. The amount payable should be known to public. Why should you withhold the information,” said the bench after reading the RBI list on defaulters.

The court noticed only 57 borrowers had not paid back bank loans that run to a whopping Rs 85,000 crore.

“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 may not be made known to the public,” asked the bench.

Kumar argued that the rules do not permit disclosure of the names held in a fiduciary relationship. RBI also took a similar stand. He said a five-member committee was constituted to examine the allegations of default.

Prashant Bhushan appearing for the Centre for Public Interest Litigation (CPIL) opposed Kumar and suggested that a former RBI governor Raghuram Rajaram-headed committee should probe the allegations. The bench declined the suggestion, saying Rajan headed the RBI that has been accused of inaction. Although the Centre wanted four weeks time, the bench fixed the case for a hearing on October 28.

The court is dealing with a 2003 public interest litigation (PIL) filed by CPIL which had alleged that the state-owned Housing and Urban Development Corporation (HUDCO) had written off debt worth Rs 40,000 crore.

The RBI had on March 29, placed in a sealed cover before the SC the list of defaulters who owed public sector banks amounts of Rs 500 crore and above.