Srinagar, July 21: Jammu and Kashmir High Court has granted Union and J&K Government Besides JKB, the lead bank in the J&K, time till August 11 for filing response to a Public Interest Litigation, challenging charging of interest on loan during the period of moratorium.
The PIL filed by local businessmen Sheikh Feroz Ahmad Sidiq— President, Restaurant and Cafe Association, Kashmir, and Mohammad Muzamil Bacha –President, Industrial Revival and Development Forum, Kashmir) also seeking directions for waiving of interest charged by the banks on the term loans during the period when moratorium was granted by the banks on account of special rehabilitation and revival package for the persons affected by natural calamity-floods in the erstwhile State; rehabilitation package to borrowers hit by the disturbances that occurred in 2016 and 2019.
The time was granted by a division bench of Chief Justice Gita Mittal and Justice Sanjay Dhar to central Finance and Home Ministry besides the J&K government, the Reserve Bank of India and the J&K Bank Ltd.
The petitioners through senior advocate Jahangir Iqbal Ganai along with advocate Sheikh Umar Farooq pleaded that the relief sought for in the instant petition is for the benefit of the persons who have suffered on account of natural calamity, disturbances of 2016 and 2019 and of the present COVID-19 pandemic. “They are not been in a position to strictly comply with the conditions of the term loan agreements,” the petitioners said, according to GNS correspondent.
The sought directions to declare the notification dated 27.03.2020, Circular No.40-619 dated January 3, 2020, circular No.62-528 dated December 15, 2016 and circular bearing No.55-398 dated October 24, 2014, as “ultra vires the Constitution of India to the extent same directs charging of interest of loan amounts during the period of moratorium.”
They have also sought directions to the authorities to waive of the interest component on the loan amounts for the period of moratorium was declared.
“In the petition, it is contended that the same is being filed for the benefit of persons belonging to Jammu and Kashmir and Ladakh, who have availed loan facilities from different banks, but, on account of the prevailing lockdown announced by the Government in view of outbreak of COVID-19 pandemic, are not in a position to pay the due instalments, including the interest charged on the loan amounts,” the court had observed.