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SFTI seeks extension of moratorium to all loan accounting for Technical Institutions; Supreme Court to hear the case on October 5

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New Delhi (ILNS): The Supreme Court will hear a public interest litigation filed by the ‘Federation of Self-Financing Technical Institutions (All-India)’, seeking extension of the moratorium to all the loan accounts of all technical Institutions across India, without discrimination or classification.

The petition filed through advocate A. Karthik seeks to highlight the plight of technical institutions approved by the All India Council for Technical Education (AICTE) functioning across India arising from the unequal treatment meted out by the government.

The petition states: “Technical Institutions across India do not have much option as compared to the other industries to avail capital towards their operating costs and capital expenditures. Almost all of the operating costs and capital expenditures of the Technical Institutions are financed through the following methods: (i) They receive fee for their services from the self-financed students (revenue). (ii) They receive post-metric scholarship amount towards aided students from the Central Government. (iii) They receive reimbursement of tuition fees by the State government. (iv) They receive loan money from the banks.

“All educational institutions are unable to effectively conduct examinations for their current students or admissions for their prospective students,” added the appeal. “While on the one hand the institutions have been ordered not to fire employees and to continue to make payment to their employees, the institutions are unable to effectively avail their services. While the lockdown announced by the Government of India was applicable to all, and the impact of the lockdown is felt across the board by all sectors, the grant of moratorium by the lenders cannot be discretionary and should be mandatorily available to all. This will make the persons equally affected being treated equally by the Respondent authorities under Article 14 of Constitution of India,” it further states.

The petitioner has prayed for the following reliefs:

(a)  Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the Union of India & others to provide such financial relief to the members of the Federation of Self-Financing Technical Institutions (All India) and others including freezing all financial liabilities of members institutions of towards banks and financial institutions or any other body corporate from whom the members of the Federation of Self-Financing Technical Institutions (All India) and others have taken loans, for a period of 6 months.

(b) Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the UoI & others to direct all Banks and financial institutions to waive the penal interest charged for a period of one year or until such time as it takes for the pandemic to abate.

(c)  Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the UoI & others to provide such financial relief to the members of the Federation of Self-Financing Technical Institutions (All India) and others including one-time restructuring for all accounts.

(d) Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the government to release matured and unmatured fixed deposits created towards corpus funds along with interest accrued thereon.

(e)  Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the government of India to release all pending post metric scholarship and return the processing fees paid towards approvals granted for the year 2020-21.

(f)   Issue a Writ of Mandamus and/or any other writ, order or direction of similar nature directing the UoI & others to direct the financial institutions to grant additional credit facility of Rs 2 Crores to each member institutions of Federation of Self-Financing Technical Institutions (All India) and others, without interest to meet salary cost and other overheads during the COVID-19 Pandemic.

(g)  Issue a Writ of Mandamus and/or any other writ, order or direction of like nature directing the government to apply the circular dated 27.03.2020 being DOR. No. BP. BC. 47/21.04.048/2019-20 to all banks and other financial institutions compulsorily and mandatorily to all loan accounts including the loan accounts of the member institutions of Federation of Self-Financing Technical Institutions (All India) and others, without any discretion given to the lending institutions;

(h) Issue a Writ of Certiorari or a writ in the nature of certiorari or any other appropriate writ, order or directions calling for the records leading to the issuance of government’s policy on March 27, 2020, April 17, 2020 and May 22, 2020 be pleased to quash and set aside the provisions in the same which contemplate the accrual of interest on the instalments falling due on and after March 1, 2020.

(i)    In the alternative to prayer Clause (h), this Hon’ble Court may be pleased to Issue a Writ of Mandamus and/or any other writ, order or direction of like nature directing the Respondent No.3 to prohibit any charging of interest on the borrowings made by members of the Petitioners No.1 and 2 which have been postponed in view of the government’s decision to apply the circular dated 27.03.2020 being DOR. No. BP. BC. 47/21.04.048 /2019-20.

(j)    Issue a Writ of Prohibition or a writ in the nature of Prohibition or any other appropriate writ, order or direction to financial institutions to not take any coercive steps against the member institutions of the petitioners for not paying the loan instalments.

(k)  Issue a Writ of Mandamus or a writ in the nature of Mandamus or any other appropriate writ, order or direction to financial institutions to reschedule the loan instalments for one academic year without any charge of interest over the interest for the unpaid period.

(l)    Pass any other further order (s) / direction (s) as this Hon’ble Court may deem fit and proper in the fact and circumstances of the case in the interest of justice.

A three-judge bench of Justices Ashok Bhushan, R. Subhash Reddy and M. R. Shah will hear the matter on October 5 through video conferencing.

Read the petition here;

FSFTI-vs.-UOI-Writ-Petition-Copy-1

-ILNS

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