Govt to act tough against wilful defaulters; loans worth Rs 50,000 crore under scanner

NEW DELHI: In order to clean up the bad-debt mess, the government and banks are reportedly getting prepared to act tough against loan defaulters who are capable of repaying their loans but have defaulted.

The government has collated information on bad loans worth Rs 50,000 crore taken by a large number of industrialists and corporate houses including diamond traders, two grounded airlines, a central government commodity trading agency, an erstwhile state government-promoted communication undertaking, a regional industry association, a media house with operations across the country, a multi-state agricultural cooperative, mining companies, realty developers and garment brands, according to a report on moneycontrol.com.

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The government and banks feel that despite having resources, these wilful defaulters have not repayed the loans and have diverted the loan money to other ventures.

A few defaulters may have even monetised, without the knowledge of banks, the assets pledged to get loans.

The government has also asked banks to start forensic audit of top 50 corporate defaulters. Comptroller And Auditor General has asked the banks to audit these defaulters and find if there is any criminal intent behind the default.

In recent years, several big corporate groups and industrialists have failed to repay their loans. A recent example is liquor baron Vijay Mallya who owes more than Rs 7,000 crore to a group of lenders including the State Bank of India.