Times of India
JAIPUR: The Rajasthan high court on Monday issued a notice to the state government on a public interest litigation that accuses banks and financial institutions of recovering loans from farmers in violation of the tenancy law. The PIL claims that the banks and financial institutions' alleged arbitrary actions were responsible for farmers' suicide. A division bench comprising Chief Justice Amitava Roy and Justice Meena V Gomber granted two weeks time to the state government to file its reply.
The PIL moved by an advocate Dhiraj Kumar pointed out that the nationalized banks and government financial institutions were providing loans to farmers against "usufructuary mortgaged" properties rather than the "simple mortgaged" ones. Kumar's counsel Arvind Chawla argued before the court that under Section 43 of the Rajasthan Tenancy Act, 1955, the loan of an 'usufructuary mortgaged' property automatically expires after five years. "Whatever loan recovery the bank or financial institute is to make from the farmer against the usufructuary property, has to be done in five years," Chawla said.
As per section 58 (d) of the Transfer of Property Act, 1882, under a usufructuary mortgage, the farmer delivers the possession, expressly or by implication, of his mortgaged property to the mortgagee (banks/ financial institutes), authorizing them to retain profits accruing from that property until the payment of the mortgaged money. The bench was told that any bank/financial institute recovering loan of usufructuary mortgaged property beyond five years was violating Rajasthan Tenancy Act. tnn
Jaipur: The Rajasthan high court on Monday issued a notice to the state government on a public interest litigation that accuses banks and financial institutions of recovering loans from farmers in violation of the tenancy law. The PIL claims that the banks and financial institutions' alleged arbitrary actions were responsible for farmers' suicide.
A division bench comprising Chief Justice Amitava Roy and Justice Meena V Gomber granted two weeks time to the state government to file its reply.
The PIL moved by an advocate Dhiraj Kumar pointed out that the nationalized banks and government financial institutions were providing loans to farmers against "usufructuary mortgaged" properties rather than the "simple mortgaged" ones. Kumar's counsel Arvind Chawla argued before the court that under Section 43 of the Rajasthan Tenancy Act, 1955, the loan of an 'usufructuary mortgaged' property automatically expires after five years. "Whatever loan recovery the bank or financial institute is to make from the farmer against the usufructuary property, that has to be done within the five years," Chawla said.
As per section 58 (d) of the Transfer of Property Act, 1882, under a usufructuary mortgage, the farmer delivers the possession, expressly or by implication, of his mortgaged property to the mortgagee (banks/ financial institutes), authorizing them to retain profits accruing from that property until the payment of the mortgaged money (loan).
The bench was told that any bank/financial institute recovering loan of usufructuary mortgaged property beyond five years was violating the Rajasthan Tenancy Act. In fact, the PIL mentioned, the banks/financial institutes keeping such mortgaged property under their possession after years were liable to be treated as encroachers. The petitioner alleged that the violation of law by the banks/financial institutes was driving the farmers to commit suicide. Newspaper reports were submitted before the court to stress that the number of farmers committing suicide was increasing.
http://timesofindia.indiatimes.com/city/jaipur/Bank-recovery-of-loans-from-farmers-leading-to-suicides/articleshow/19452331.cms
RBI asked to restore priority sector lending tag for bank loans to NBFCs-- Business Line
Access to cheaper overseas funds, stable policy among NBFCs’ demands at pre-policy meet
MUMBAI, APRIL 9:
A stable long-term policy regime and recognising bank loans to non-banking financial companies (NBFCs) as priority sector lending were some of the key demands that NBFCs placed before the Reserve Bank of India on Tuesday.
In their customary pre-policy consultative meeting with the RBI, the NBFCs articulated the problems faced by them and what help they would need from the regulator.
Mahesh Thakkar, Director General, Financial Inclusion Development Council, said, “We requested the RBI to restore the priority sector lending tag for banks lending to NBFCs. This would help NBFCs access funds at cheaper rates from banks.”
Earlier, the banking regulator had stripped the priority sector tag for bank lending to NBFCs. Thus, the banks lost the incentive to lend to NBFCs at a cheaper rate. NBFCs, therefore, had no choice but to pass on the high cost of funds to the customers in the form of higher lending rates.
In the meeting, NBFCs also requested the RBI to further liberalise the external commercial borrowing norms to access cheaper funds from overseas markets, Thakkar informed.
THORAT COMMITTEE
The NBFCs have also requested the RBI to put on hold the Usha Thorat committee recommendations on issues and concerns in the NBFC sector, till the economy recovers.
Among other things, the draft guidelines of the Committee suggest that NBFCs be brought on par with banks by reducing the period for classifying loans as non-performing from 180 days to 90 days.
It also suggested that NBFCs maintain a tier-I capital ratio of 10 per cent against the existing 7.5 per cent to equip them better from future financial shocks.
NBFCs have cried foul, saying that like banks they are not allowed to recover loans using the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act, 2002 or the Debt Recovery Tribunals.
LONG-TERM POLICY
The NBFCs, Thakkar said, conveyed to the RBI that a stable policy is required over the long term to encourage foreign investment in the sector.
“We told the RBI that it needs to frame policies and keep it steady over the long term, say 10 years, unless there is a major change in the world economy,” he said.
The RBI has asked NBFCs to revert with suggestions for the long-term policy. “We will get back to them in a month’s time,” Thakkar said.
For most of the applicants the approval comes fast and the cash is electronically available to them within 24 hours in bank account.Long term installment loans, long term installment payday loans, long term installment loans online.
ReplyDelete