Case Law Details
Anant Raj Ltd. Vs Yes Bank Ltd. (Delhi High Court)
As per the petitioner, during the period 2010 – 2015, petitioner had availed bank loan facility from the respondent bank to a tune of Rs. 815 crores which has been paid in full. Thereafter between 2016 –2018, respondent bank extended further loan facilities to the petitioner vide several sanction letters. As per the petitioner, it had availed loan facilities to the tune of 1570 crores out of which, petitioner has repaid about Rs. 1056 crores apart from interest running into hundreds of crores.
The case of the petitioner is that due to out-break of COVID-19 and spread of the same across the globe in December, 2019, economic condition of the real estates industry was adversely affected. Petitioner had been regularly servicing the loans in terms of the loan conditions till 31.12.2019. It is stated that the instalment for repayment which fell due on 01.01.2020, which is the subject matter of the present petition, could not be paid by the petitioner because of adverse economic conditions brought about by the effects of COVID-19 pandemic.
As per the respondent, in terms of the Income Recognition and Asset Classification Guidelines (IRAC Guidelines) of the Reserve Bank of India, if an instalment is overdue by a period of 30 days, the borrower’s account is classified as Special Mention Account – 1 (SMA-1) and if the instalment is overdue by 60 days, the account is classified as Special Mention Account – 2(SMA-2) and if the instalment is overdue by a period of 90 days, the account is classified as Non-performing Asset (NPA).
As per the respondent, since the instalment that was due on 01.2020 was not paid within 30 days, the account of the petitioner was classified as SMA-1 and thereafter since it was not paid within 60 days, the account was classified as SMA-2.
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