Strict action to be taken against Loan defaulters: SC

The Supreme Court of India said that the loan defaulters must be dealt with sternly and strict action to be taken against them. It was concerned over increasing number of corporate houses and private institutions not paying back loans taken from banks and public bodies. The supreme court slammed Maharaji Educational Trust, which runs several medical colleges and hospitals, for not repaying Rs 480 crore to Housing and Urban Development Corporation Limited (HUDCO). The trust had taken a loan of Rs 75 crore in 1995 which swelled to Rs 480 crore with interest. The trust failed to repay the amount in the last 22 years. & quot The Trust is a wilful defaulter and has built the property, colleges, hospitals from the money borrowed from HUDCO. It was the duty of the Trust to pay back the money to HUDCO. Despite running the institutions for the last 22 years, they have not paid back the amount,& quot the bench said. “ It has become a general scenario that the persons who earn money with help of hefty loans, in spite of running institutions which have been set up by the money lent to them, they are not making payment of dues.& quot it said. The bench directed the Trust to reconcile a scheme of repayment to HUDCO within one month and start payment of dues from June. The court also granted permission to HUDCO to sell properties of the Trust if it failed to refund the money. The court said it was necessary to safeguard the interest of HUDCO and it would not be appropriate to make HUDCO & quot wait till eternity& quot to get back the money. It was made clear that in case the trust wants to run institutions, they are bound to pay in all fairness all sums which they have borrowed without any ifs and buts.