Mrs Reena N Singh in a PIL filed before the Supreme Court of India prayed to restrict banks from technically writing off NPA’s and also to prohibit Center and State governments from launching loan waiver schemes.
The applicant in her petition contends against the practice of writing off NPA’s by banks stating it to be “Similar to tampering and fabricating of Balance Sheet which will not give the true and fair picture of its financial condition”. Further, in her petition, she pointed out that Banks get a certain percentage of reduction in tax liability and therefore such mentions prove beneficial for them to reduce their own taxes.
Pointing out towards the Loan Waiver Schemes offered by political parties in their election manifesto it was alleged that governments use the taxes of the general public for increasing their own vote banks. This is clearly, on one hand, is a gross misuse of taxpayer’s money and on the other is spoiling the economy’s credit culture which ultimately makes the farmers financially weak.
The applicant states out about the lack of perfect agricultural model due to the unwillingness of political power to make farmers financially strong and independent. The scheme of loan waiver is called similar to ‘sweet poison’ for farmers.
It is argued that the technical write off’s by Bank encourage non-transparency and wrongdoings, even the instance of CAG questioning the role of RBI on NPA Crisis was mentioned in PIL.
The petition would be heard on 22nd April 2019 by a bench headed by Justice S.A. Bobde.
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