The Centre on Thursday said that every account named in the Panama leak case is being probed but made it clear that nobody would be punished without a proper process. “Nobody has ever taken more action than this Government on foreign account details which have come,” Finance Minister Arun Jaitley said in the Rajya Sabha while replying to a debate on Banking Regulation (Amendment) Bill which was passed by the House later.
“We have a rule of law. We do not have system like the neighbouring country where you remove first and then have a trial,” Jaitley said, clearly referring to former Pakistan Prime Minister Nawaz Sharif who was ousted last month over the Panama papers leak issue.
The Banking Regulation (Amendment) Bill, 2017, will enable the Government to empower the RBI to direct lender banks to act against big loan defaulters. The bill, which amends the Banking Regulation Act, 1949, will replace the Banking Regulation (Amendment) Ordinance, 2017. The lok Sabha had passed the bill earlier.
Introducing the bill in the Rajya Sabha, Jaitley said the delay in the legislation to empower the Reserve Bank of India (RBI) to direct lenders to act against big defaulters was hindering the banks’ capacity to support growth.
Once it becomes a law, the Central Government may authorise the RBI to issue directions to the banks to initiate proceedings in case of loan repayment default. These proceedings would be under the Insolvency and Bankruptcy Code, 2016.
The RBI may, from time to time, issue directions to banks for resolution of stressed assets and may specify authorities or committees to advise banks on resolution of stressed assets. Stressed assets are loans where the borrower has defaulted in repayment or where the loan has been restructured (such as by changing the repayment schedule).
The bill inserts a provision to state that it will also be applicable to the State Bank of India, its subsidiaries, and Regional Rural Banks.