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Explain why technical loan write-off route applied to fugitives: P Chidambaram to government

Explain why technical loan write-off route applied to fugitives: P Chidambaram to government
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Senior Congress leader P Chidambaram
Highlights

Earlier, FM Nirmala Sitharaman said that wilful defaulters were beneficiaries of 'phone banking' under the UPA regime and the government is chasing them to recover the dues.

New Delhi: Senior Congress leader P Chidambaram on Wednesday asked the government to explain why it had taken the technical loan write-off route for fugitives like Nirav Modi, Mehul Choksi and Vijay Mallya.

His remarks came after Finance Minister Nirmala Sitharaman said that wilful defaulters were beneficiaries of 'phone banking' under the UPA regime and the Modi government is chasing them to recover the dues.

She was responding to the opposition party's allegations of loan waiver worth Rs 68,607 crore in the form of write-offs to the top 50 wilful defaulters till September 2019.

Chidambaram said that one cannot deny the rule that banks can write-off loans technically and recoveries can continue against wilful defaulters, but why was the rule applied to fugitives, who fled the country, after committing frauds.

"One is not denying such a rule that can be applied to a wilful defaulter. But, we are asking these are fugitives and they have left the country and are absconding. Why are you applying this rule to Nirav Modi, Mehul Choksi and Vijay Mallya," he said at press conference conducted through video conferencing.

The former finance minister said, "When they are fugitives, the technical rule in the book should not be applied to them. That is my view. This rule can be applied to other categories of defaulters, but why is it being applied to fugitives?"

"Why does she take shelter behind the technical rule," he said hitting out at Sitharaman.

One can technically write off loans of defaulters, willful defaulters and willful defaulters who stay back and try to face an enquiry, but why do they have to apply that rule to a willful defaulter who has fled India and the government has declared him a fugitive, he said.

"Why does this rule apply to Nirav Modis, Vijaya Mallyas and Mehul Choksis? They have been declared fugitives. That's why we questioned the bonafides of this government," he said.

Asked whether these loans were recoverable, the Congress leader said he did not know whether they were recoverable or not as it would depend on whether these fugitives have assets in India or abroad. "Those are questions which the government must answer," he said.

Attacking the finance minister, Chidambaram said, "Why was she silent for the last 37 days and has now suddenly sprung to life and sprung to the defence of these fugitives. Is it not a little surprising and ironic."

Earlier, Congress chief spokesperson Randeep Surjewala accused Sitharaman of "misleading and mis-stating facts". "To mislead or mistate facts while holding the august office of FM is most unfair @nsitharaman ji! You tweeted that Rs 2,780.50 cr have been recovered from Modi-Choksi-Mallya. On 16th March, 2020; Parliament was told that ED has recovered only Rs 96.93 CR in 5 yrs under PMLA-FEMA," he tweeted.

He attacked the government over the issue of bad loans, accusing it of weakening the entire banking architecture fiscally and imprudently in the name of cleaning the system. "Mr @PrakashJavdekar & @nsitharaman ji, Listen to Sh @PChidambaram_IN ,take tuition & answer- Why did Modi govt waive off loans of defaulters & fugitives like Mehul Choksi+Nirav Modi (Rs 8,048Cr), Jatin Mehta (Rs 6,038 cr), Mallya (Rs 1,943 cr) & others? Why defend the fugitives,"Surjewala tweeted.

The party was responding to Sitharaman's tweet on Tuesday night in which she accused the Congress and its leaders of "misleading" people on loan write-offs. "Nirmala Sitharaman ji, cleaning the banks of people's money by writing off loans of absconders and fraudsters is not called 'cleaning the system'," Surjewala said in a tweet.

"It's called weakening the entire bank architecture fiscally and imprudently, if not maliciously," he said.

In a tweet, the finance minister had accused Congress leaders Rahul Gandhi and Surjewala of attempting to mislead people in a brazen manner. "Typical to Congress, they resort to sensationalising facts by taking them out of context," she had said.

Hitting back, Surjewala demanded answers from Sitharaman instead of "twisting facts". "Simple answer that FM, Smt @nsitharaman needs to give instead of twisting facts-:Why has Modi govt written off bank loans worth 6,66,000 cr between 2014-15 & 2019-20? Is RBI's RTI reply dated 24th April, 2020 of bank loans write off of Rs 68,607 crore wrong or right," he asked.

"Why is Modi govt writing off bank loans of absconders & fraudsters like Nirav Modi+Mehul Choksi (Rs 8,048 CR), Jatin Mehta (Rs 6,038 cr), Mallya (Rs 1,943 cr) & others as per RBI's RTI reply of 24/4/2020? "Who permitted such huge write offs of bank loans of defaulters and why," Surjewala asked the finance minister.

The RBI released a list of 50 top bank loan defaulters in the country in an RTI reply. Sitharaman had also said "Congress and Rahul Gandhi should introspect why they fail to play a constructive role in cleaning up the system. Neither while in power, nor while in the opposition has the Congress shown any commitment or inclination to stop corruption and cronyism."

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