DURGA PRASAD SAH Vs. STATE OF BIHAR

JUDGEMENT

(1.) This case should be an eye opener to the law makers of the nation and those who control the fiscal discipline of public finances. Time after time, this High Court has brought it to the notice of the governments in administration that there is something serious which needs to be addressed on the non-performing assets, that is to say, of loans which have been taken from public financing institutions and banks and such loans remain unpaid. The Court had asked this question from Counsel for the bank on what exactly be the position nationwide of amounts which stand in debt. On instructions this is indicated by Counsel for the State Bank of India as over Rs. 60,000 crores.

(2.) This amount is contributing to the deficit financing in the nation's economy. If this amount of Rs. 60,000/- crores represents loans outstanding against bad debtors then this deficit has to be made up by resorting to taxes, direct or indirect. Innocent people who have nothing to do with these had debts land up playing taxes and this amount alone perhaps may be the reason for deficit financing of the nation's planned economy. Deficit contributes to inflation which is over six per cent today.

(3.) The amount in this particular case was taken as a loan in 1986. It was Rs. 4,95,016.15. Today, it is 17 years and Counsel was unable to answer the inquiry of the Court whether any part of this amount was returned. Learned Counsel stated that he had no instruction on this. The result is on the record. Of the debt which was not cleared, the bank had to file a suit for recovery of this money. The suit was decreed on 6 September, 2000. The bank had to file an execution case. This aspect is not relevant and the execution proceedings virtually stood transferred to the tribunal constituted under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (Act 51 of 1993).