Lok Sabha Question No. 35 (STARRED), answered on 2019-06-24
Subject: Wilful Defaulters
Ministry: FINANCE
Asked by: Pushpendra Singh Chandel, Shrirang Appa Barne

## GOVERNMENT  OF INDIA

## MINISTRY OF  FINANCE DEPARTMENT  OF FINANCIAL SERVICES

## LOK SABHA STARRED QUESTION NO: *35 TO BE ANSWERED ON THE 24 th  JUNE, 2019/ASHADHA 3, 1941  (SAKA)

## QUESTION Wilful  Defaulters

## *35:  SHRI  KUNWAR  PUSHPENDRA  SINGH CHANDEL: SHRI  SRIRANGA  APPA  BARNE:

Will  the Minister  of FINANCE  be pleased to state:

- (a) whether  the cases of wilful  defaulters  of banks  have increased  during  the last five years;
- (b) if so, the details  thereof  and the reasons therefor  including  the number  of such defaulters  reported  to the Government  by  the Nationalised  Banks during  each of the last five years;
- (c) the details  of the Government  policy  to deal with  such defaulters;  and
- (d) the amount recovered from  the such defaulters by the Nationalised Banks/Union  Government  during  the said period?

## ANSWER

FINANCE  MINISTER

(SMT. NIRMALA  SITHARAMAN )

(a) to (d): A statement  is laid  on the Table  of the House.

Statement  as referred  to in reply  to paras (a) to (d) of Lok Sabha Starred Question no. *35 for  answer on 24 th  June, 2019/  Ashadha 3  (Saka), 1941 regarding 'Wilful  Defaulters' by  SHRI KUNWAR  PUSHPENDRA  SINGH CHANDEL and SHRI SRIRANGA  APPA  BARNE, Hon'ble Member of Parliament

(a) to (d): Details  of wilful  defaulters  declared  by  nationalised  banks  during  the last five financial  years are  at Annex.

Wilful  defaulters  have been acted against  comprehensively. As per data reported  by nationalised  banks,  till  31.3.2019,  suits for recovery  have been filed in 8,121 cases. In cases involving  secured assets, action  under the provisions  of the Securitisation and Reconstruction  of Financial  Assets and Enforcement  of Security  Interest  Act, 2002 has been initiated  in 6,251 cases. Further,  in accordance  with  RBI instructions of initiation of criminal  proceedings  wherever  necessary,  FIRs have been registered in 2,915 cases.

Moreover , to deter wilful  defaulters,  as per RBI's instructions, wilful  defaulters  are not sanctioned  any  additional  facilities  by  banks  or financial  institutions, and their unit  is debarred  from floating  new  ventures  for five years.  Further, vide Securities and Exchange Board of  India (Substantial   Acquisition   of  Shares  and  Takeovers) (Second  Amendment)   Regulations,   2016,  wilful   defaulters   and  companies   with wilful  defaulters  as promoters/directors have been debarred  from accessing capital markets  to raise funds. In addition,  the Insolvency  and Bankruptcy Code,  2016 has debarred  wilful  defaulters  from participating in the insolvency  resolution  process.

Additionally, for effective action against wilful defaulters fleeing Indian jurisdiction, the  Fugitive   Economic   Offenders   Act,   2018  has  been  enacted   to provide  for attachment  and confiscation  of property  of fugitive  offenders and has disentitled  them  from defending  any  civil  claim.  Further,  Government  has advised Public   Sector  Banks  (PSBs)  to  decide  on  publishing   photographs   of  wilful defaulters,  in terms  of RBI's instructions  and as per their  Board-approved  policy, and to obtain  certified  copy  of the passport  of the promoters/directors and other authorised   signatories   of  companies   availing   loan   facilities   of  more   than   Rs.  50 crore.  Heads of PSBs have also been empowered  to request  for issue of Look  Out Circulars (LOCs).

As per data reported  by  nationalised  banks,  an amount  of Rs. 7,654 crore  has been recovered  from wilful defaulter  accounts  during  the last five financial  years.

Lok Sabha Starred  Parliament  Question  No. *35, for  24.6.2019 Data on wilful  defaulters  for  Nationalised Banks

| Financial year   | Total numberof wilful defaultersdeclared by end of the financial year (including wilful defaultersdeclared in previousyears)   |
|------------------|--------------------------------------------------------------------------------------------------------------------------------|
| 2014-15          | 5,349                                                                                                                          |
| 2015-16          | 6,575                                                                                                                          |
| 2016-17          | 7,079                                                                                                                          |
| 2017-18          | 7,535                                                                                                                          |
| 2018-19          | 8,582                                                                                                                          |

Source: Banks