PMC Case: Depositors Can Approach RBI Admin For Emergency Withdrawals
Depositors of the crisis-hit Punjab & Maharashtra Co-operative Bank can approach the Reserve Bank of India-appointed administrator for withdrawal of up to Rs 1 lakh in case of medical emergencies, the central bank told the Bombay High Court on Tuesday.
In an affidavit filed in the high court in response to petitions challenging the fund withdrawal restrictions, the RBI has mentioned the withdrawal ceiling at Rs 50,000 for scenarios like marriage, education, livelihood and “other hardships”.
RBI counsel Venkatesh Dhond told a division bench of Justices SC Dharmadhikari and RI Chagla that the depositors facing hardships can approach the RBI-appointed administrator and seek withdrawal up to Rs 1 lakh. Such withdrawal restrictions were necessary to safeguard the interests of the bank and its depositors, the affidavit stated.
The apex bank also stated that largescale wrongdoing has been found in the PMC bank. On Sept. 23, the RBI had imposed regulatory restrictions on the PMC Bank for six months over alleged financial irregularities.
“To mitigate the hardship of the depositors, the RBI has enabled entertaining on merit any application for withdrawal beyond the stipulated amount on hardship grounds like medical treatment, marriage, education, livelihood and other hardships, subject to a ceiling of Rs one lakh on medical ground and Rs 50,000 in all other cases,” the affidavit stated.
The bench after perusing the affidavit posted the petitions for further hearing on Dec. 4. The withdrawal limit for account holders was initially Rs 1,000 per each customer for six months, which was later raised to Rs 10,000 and is now presently at Rs 50,000.
The crisis at the bank is attributed to the loans allocated to realty firm the Housing Development Infrastructure Ltd. without scrutiny. These loans later turned into non-performing assets.