Kerala HC Slams Centre’s Refusal To Waive Debts, Stays Loan Recovery For Wayanad Landslide Victims

The Kerala High Court criticised the Union government for failing to provide financial relief, specifically loan waivers, to victims of the 2024 Wayanad landslides.

The PIL seeks to enhance Kerala’s disaster preparedness, ensure timely relief, and provide support to families impacted by natural calamities.

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In a stern reprimand, the Kerala High Court on Wednesday expressed disappointment at the Union government for its inaction in extending financial relief to victims of the 2024 Wayanad landslides, stating that the Centre had “virtually failed” those affected by not exercising its authority to waive outstanding loans.

Kerala HC Slams Centre’s Refusal To Waive Debts

The bench, comprising Justices AK Jayasankaran Nambiar and Jobin Sebastian, described the government’s refusal to consider loan waivers as both “unfortunate” and “exasperating.” In response, the court ordered a halt to all loan recovery proceedings by banks against affected individuals until a final decision is taken in a Public Interest Litigation (PIL) initiated suo motu following the disaster, as per Bar and Bench. The PIL seeks to enhance Kerala’s disaster preparedness, ensure timely relief, and provide support to families impacted by natural calamities.

The court also added 12 major banks as parties to the case, including State Bank of India, Bank of Baroda, Canara Bank, Punjab National Bank, Indian Bank, Federal Bank, and Kerala Gramin Bank. These banks were directed to submit counter affidavits clarifying whether they would consider full or partial loan waivers for landslide victims. The bench also allowed banks to request modifications to the stay order if they could demonstrate valid reasons to continue recovery efforts, reported PTI.

The remarks came after the Central government affidavit stated that loan waivers are restricted under the Reserve Bank of India’s 2018 Master Directions on Relief Measures for Areas Affected by Natural Calamities. The affidavit further claimed that public sector banks are autonomous commercial entities and that the government cannot interfere in their financial decisions.