Top court to hear plea for insuring bank customers

The Supreme Court yesterday agreed to hear an appeal seeking guidelines on 100% insurance coverage for around 1.5mn people whose money is blocked in the scam-hit Punjab and Maharashtra Co-operative Bank (PMC Bank).

Last month, the Reserve Bank of India (RBI) had imposed regulatory restrictions on the bank under the provisions of the Banking Regulation Act. The RBI had initially allowed depositors to withdraw Rs1,000, which was later raised to Rs25,000 and again to Rs40,000, but the customers have been demanding full access to all their accounts.

A bench headed by Justice N V Ramana said it would consider listing of the plea.

The petition was filed by Delhi-based Bejon Kumar Misra, who said that the RBI’s move has caused disastrous consequences for depositors. Misra also alleged that the central government and the RBI had not taken any emergency steps towards the protection of the hard-earned money of around the bank customers.

He urged the court to issue an exhaustive and comprehensive guideline to safeguard the banking and co-operative deposits in the eventuality of emergency financial crisis where common people are financially stranded by the acts of a few unscrupulous persons leading to various personal irreversible catastrophes.

He has also sought quashing of the RBI notifications restricting the limit of withdrawal of money from the bank.

Meanwhile, against the backdrop of the deaths of two depositors in the past two days, over 100 agitated depositors staged a protest outside the Esplanade Court in Mumbai yesterday demanding justice.

Also yesterday, the court to judicial custody till October 23 two directors of HDIL – Rakesh Wadhawan and his son Sarang Wadhawan, and PMC Bank’s former chairman S Waryam Singh – who were arrested in connection with the Rs4,355 crore scam in the bank.

The protesters carried placards and banners, shouted slogans against the RBI, waved posters reading: “Two lives taken, RBI – how many more lives will be gone.” 

The protest came after the death of two depositors – 51-year-old Sanjay Gulati on Monday and 61-year-old Fattomal Punjabi – whose entire life savings remain inaccessible after the RBI’s sanctions imposed on September 23 on the bank.

Some senior depositors squatted on the roads outside the court, others protested in groups and a few went around with posters saying: “Vote For NOTA”, in reference to the October 21 Maharashtra assembly elections.

A few who addressed the gathering demanded that in order to mitigate the sufferings of the depositors, the RBI should immediately lift curbs on the bank.

Later, a delegation of the protesters met the police who informed them of the actions being taken and the steps already taken, and said none of the perpetrators of the scam would be spared.

A depositor said another delegation is likely to call on Maharashtra Governor B S Koshyari and brief him of the plight of the bank’s customers ahead of the festival season.

In a related development, banking expert Vishwan Utagi held a meeting in Navi Mumbai of hundreds of institutions whose funds have been locked up in the PMC Bank and discussed several remedial options to get them released.

Expressing solidarity with the two deceased depositors, groups of people have been organising candle-light protests and condolence meetings.

As seen on GulfTimes  Image Credits GulfTimes