News By/Courtesy: Riddhima Kedia | 27 Jun 2020 0:40am IST

HIGHLIGHTS

  • The Delhi High court asked the Reserved Bank of India and the Centre to file their affidavits within three weeks and listed the matter for further hearing on August 6.
  • The court was hearing a plea seeking direction to the RBI to issue a statement on timelines and safety of deposits with the PMC Bank
  • The plea was filed in a pending petition concerning the fate of the deposits made with the PMC Bank.

The Delhi High court asked the Reserved Bank of India and the Centre to file their affidavits within three weeks and listed the matter for further hearing on August 6. The court asked them to explain how the depositors of scam-hit Punjab and Maharashtra Cooperative (PMC) Bank are “differently circumstanced” in comparison to Yes Bank, which was revived after infusion of funds by investors including state-owned SBI.

According to the March notification issued by the center, the central government along with the RBI has important decisions to take including the permit for Yes Bank Limited Reconstruction Scheme 2020 being brought into play and to have it funded.

The court was hearing a plea seeking direction to the Reserve Bank of India (RBI) to issue a statement on timelines and safety of deposits with the PMC Bank and to ensure that payments are made to depositors with interest.

The center informed Justice Rajiv Shakdher and briefed him about the government not investing any funds in scam-hit hit Yes Bank and investors, including state-owned SBI, which had invested in its share capital after sanction to the reconstruction scheme.

On Thursday, the high court said in an order that in these circumstances, the RBI will file an affidavit as to what propelled it to take action in the ‘public interest’ to secure the interest of the depositors of Yes Bank and the reason why the Union of India accorded sanction to the reconstruction scheme. The affidavits will delve into the aspect as to how the depositors of PMC Bank are differently circumstanced in comparison to the depositors of Yes Bank. Furthermore, the affidavit of the Union of India will indicate as to the shares it holds in SBI and the representation it has on the SBI’s Board of Directors.

It asked the RBI and the Centre to file their affidavits within three weeks and listed the matter for further hearing on August 6. The high court was informed by the counsel for the administrator of PMC Bank that till now none of the assets of the bank, which were seized, have been liquidated and an application in this regard has been before the court concerned.

Within the given period of three weeks, the judge urged the administrators to revert by filing an affidavit.
“Given the dire state in which the depositors of PMC Bank are placed today, the Administrator, to my mind, should approach the concerned Court and endeavor to hasten the process. The circumstances created by the coronavirus pandemic affects even the depositors of the PMC Bank,” said the judge.
The court had earlier asked the administrator of the bank to file a status report which shall indicate whether or not the sale of assets of the promoter-directors of HDIL has taken place. Two directors — Rakesh Wadhawan and his son Sarang Wadhawan — of Housing Development and Infrastructure Ltd (HDIL) were earlier arrested in the PMC bank scam case.

In September last year, the RBI had imposed restrictions on PMC Bank and also superseded the board and management of the bank and appointed an ex-RBI official as the administrator.
The plea by Sandeep Bhalla also sought a direction to the RBI to allow the petitioners and depositors particularly senior citizens to withdraw amounts up to the interest on their deposits to enable them to make their living.

The plea was filed in a pending petition concerning the fate of the deposits made with the PMC Bank.

THIS ARTICLE DOES NOT INTEND TO HURT THE SENTIMENTS OF ANY INDIVIDUAL, COMMUNITY, SECT, OR RELIGION ETCETERA. THIS ARTICLE IS BASED PURELY ON THE AUTHOR'S PERSONAL VIEWS AND OPINIONS IN THE EXERCISE OF THE FUNDAMENTAL RIGHT GUARANTEED UNDER ARTICLE 19(1)(A) AND OTHER RELATED LAWS BEING FORCE IN INDIA, FOR THE TIME BEING.

Section Editor: Pushpit Singh | 27 Jun 2020 9:29am IST


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