Business Mantra: Faridabad
Punjab National Bank, a Government Bank has declared 904 firms/companies etc. as “Willful Defaulters” who have failed to repay the Bank Loan amounting to Rs.10869.72 Crores as on 31-12-2015.
Bank has been updating its list of “Willful Defaulters” every calendar quarter regularly since June, 2013.
According to the Managing Director of the Bank Ms. Usha Ananthasubramanian, Bank shall continue to publish such list till desired recovery is affected against such borrowers. Biggest 10 defaulting borrowers in this list owe Rs. 3554 Crores, including the companies of Mr. Vijay Malya- Kingfisher Airlines, Winsome Diamonds, Forever Precious Jewellery & Diamonds, Zoom Developers, VMS Systems, NAFED, S Kumar Nationwide etc.
A borrower who does not either repay its Bank dues willfully inspite of the fact he has capacity to pay or divert bank funds for his personal use or uses funds not for creating assets or disposes off assets created out of Bank Loan without the consent/knowledge of the Bank/FI.
In this context former PNB CMD and Ex-Deputy Governor of RBI Mr. K C Chakravarty has also expressed in favour of publishing names of “Willful Defaulters” publically by all financial institutions and Banks. Banks should give a patient hearing, a cautious approach and an honest search, before pronouncing a defaulting borrower as “Willful Defaulter”. This act has a negative effect, as act of Willful Default by the Banks/FIs is subject to challenge in the court of law, which may result as the delaying tactics by the borrowers in recovery proceedings. Some genuine default of loans by the borrowers may become the victims of such process.
It is expected that the Government of India may come out with guidelines in the coming budget.