Tribune press service
New Delhi, November 29
Scheduled commercial banks have canceled loans of Rs 46,382 crore in the first six months of the current fiscal year 2021-2022, the government said in Lok Sabha on Monday.
However, the Union Ministry of Finance declined to provide details of large companies whose loans have been canceled, citing Section 45E of the RBI Act which prohibits the disclosure of credit information. Section 45E provides that credit information submitted by a bank must be treated confidentially and not be published or otherwise disclosed.
According to RBI global transaction data, bad debts that were fully provisioned after four years were written off. This assessment by banks is part of their regular exercise to clean up their balance sheets, benefit from tax advantages and optimize their capital. This is in line with RBI guidelines and policy approved by bank boards, the government said.
Loans written off do not allow borrowers to get away with it. They remain responsible for repayment and the process of collecting contributions from the borrower on written off loan accounts continues.
Banks continue to pursue collection actions initiated in written off accounts by bringing lawsuits in civil courts or debt collection courts, actions under the law on securitization, filing cases in NCLT by the sale of non-productive assets.