Supreme Court Says Banks Must Hear Loan Defaulters Before Declaring Accounts Fraud

Many times people resort to loans to meet some sudden need or to handle some big work. Many times people also take loans from banks to increase business. Some of these cases also come to the fore, in which the borrower is unable to pay the loan installments of the bank and the bank declares his loan account as a fraud. Now banks will not be able to do this like before. The Supreme Court has given a fresh decision in this regard.

Defaulters will get this chance

The Supreme Court, while hearing a case on Monday, said that before declaring any loan account as a fraud, the lender should be given an opportunity to present its case on behalf of the banks, as the CIBIL score of the person concerned with this move of the banks. But there is a bad effect. Hearing the case, a bench headed by the Chief Justice said that banks cannot unilaterally declare an account as a fraud without giving the defaulter a chance to present his case.

Supreme Court made such a comment

Apart from this, the bench also said that in case of declaring a loan account as fraud, there is no need to take such a step even before registering an FIR. The Supreme Court said that declaring a loan account as a fraud is tantamount to blacklisting the concerned borrower. The apex court was considering two High Court decisions in this regard.

What does RBI circular say

In fact, the Telangana High Court and the Gujarat High Court had given a verdict on the Reserve Bank of India’s fraud master circular (Frauds Classification and Reporting by Commercial Banks and Select Fls Directions 2016). This master circular of the Reserve Bank directs banks to classify loan accounts of willful defaulters as fraud.

This was the decision of the High Court

This master circular of the Reserve Bank was challenged in several courts. The Telangana High Court, facing one such challenge, had said that not giving the right to represent is a violation of the constitutional rights of the borrower. The Supreme Court has also agreed with the opinion of the Telangana High Court.

read this also: These 4 rules are changing for mutual fund investors from next week

How To Check Which App Is Tracking Your Location In iPhone And How To Turn It Off

How to turn off location access in iPhone: Privacy is gradually decreasing in our life today. Everything is available in ...
Read More

LIC ADO Mains Result 2023 Declared For All Regions See Direct Link Here At

LIC ADO Mains Result 2023 Declared For All Regions: The result of LIC ADO Main Exam 2023 has been declared ...
Read More

IPL 2023 Chennai Super Kings Last Over Ravindra Jadeja Six For CSK Vs GT Ahmedabad

IPL 2023 CSK Vs GT Final Last Over Ravindra Jadeja: Chennai Super Kings defeated Gujarat Titans by 5 wickets in ...
Read More

IPL 2023 MS Dhoni not ready to retire CSK will come next season 5th time champion

MS Dhoni Retirement CSK Vs GT Final IPL 2023: Chennai Super Kings, captained by Mahendra Singh Dhoni, won the IPL ...
Read More

India Top List Of Cheapest Manufacturing Costs 2023 Countries

Manufacturing Cost in India: India is achieving new feat every day in the manufacturing sector. By leaving countries like China, ...
Read More

WhatsApp Business Will Soon Get Status Archive Feature One Can Save Status Up To 30days

WhatsApp Status Archive Feature: Soon a new feature is going to be given to the users on Meta WhatsApp Business ...
Read More

Jharkhand Board 12th Result 2023 JAC Arts And Commerce Result 2023 May Release Today 30 May At 2.30 Pm

JAC 12th Result 2023 Date And Time: The wait for Jharkhand Board 12th Arts and Commerce students may end soon ...
Read More

UpGrad Abroad Plans To Add 500 Members In The Next Three Months New Jobs On Board Soon

UpGrad Abroad Hiring Plan: At present, companies all over the world are either doing layoffs or cutting down on the ...
Read More

IPL 2023 MS Dhoni Celebration With Ravindra Jadeja Chennai Super Kings Champion

MS Dhoni Chennai Super Kings Champion IPL 2023: Chennai Super Kings became champions for the fifth time by winning the ...
Read More

Leave a Comment