The matter was heard on Wednesday by a bench of Justices Sanjay Kishan Kaul, Abhay S Oka, and BV Nagarathna.
During the hearing, the counsel for the petitioner pressed for the implementation of all of the Committee’s recommendations since the matter was listed for directions. In particular, he highlighted the recommendation for probe by the Central Bureau of Investigation (CBI) into defaults/ frauds greater than ₹ 50 crore.
Justice Kaul, in turn, orally observed,
“We have to balance issue of public money and see that ending procedure is not too cumbersome.”
The RBI’s counsel pointed out that some of the recommendations, such as setting up of fast-track courts, was beyond its domain.
“To the extent that the RBI is a regulator, it has to take a stand. Someone has to apply their mind as to what can be done,” Justice Kaul, said in response.
Solicitor General Tushar Mehta, appearing for the Central government, said that, ultimately, bank-customer relationships are fiduciary, and that separate regimes currently exist to tackle the issue, through statutes like the Insolvency and Bankruptcy Code (IBC).
When the bench highlighted the increasing use and role of technology in banks and bank scams, advocate Prashant Bhushan, appearing for the petitioner, said that a solution could be to equip the CBI with personnel trained on these aspects.
The bench then directed the RBI to file a further affidavit on steps it can take, specifically as a regulator, to implement the Committee’s recommendations, within four weeks.
The matter will be heard again after six weeks.
Source: Barandbench
