The Hindu Business Line : Bad cheques

Many of us are not aware of the modus operandi banks adopt while sanctioning farm loans. We are more informed of US fallout but least concerned about our local issues.

The article raises two crucial issues — one, wrongful application of Section 138 of Negotiable Instruments Act and other on non-applicability of Debt Relief and Loan Waiver or DRLW.

The crux of the matter is that of the agonising experience a farmer faces in the event of default of loans. It is not clear in the article if his experiences are confined only to urban co-operative credit banks or other banks too (nationalised banks). In any case, it boils down to the issue of ignorance of bank’s practices and rules due to illiteracy.

These days the Government has been making it amply clear that transparency should evolve in any machinery.

What needs to be done in this case is to regularise the working of urban credit banks and make them apolitical.

Second, the issue of debt waiver should have been handled more diligently by banks instead of merely echoing the Government’s stand that there should not be incorrect inclusion or incorrect exclusion.

This understandably was due to announcement the figures arrived at before the public for the waiver/relief.

This kind of approach has probably caused exclusion of the case that the author had mentioned.

The RBI/Nabard audit, not with a purpose to manhunt for the errors committed but with the aim of a fair exercise, can still be adopted, as the Government has still not parted with the waiver money.

B. N. Iyer Chennai