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Loan rescheduling

Writ over BB circular not maintainable

BB lawyer tells HC

FE REPORT | October 28, 2019 00:00:00

The writ petition that challenged the central bank's circular allowing defaulters to reschedule their loans with a repayment period of 10 years and get further loans is not maintainable, Bangladesh Bank's lawyer Ajmalul Hossain said during a court hearing on Sunday.

A writ petition cannot be filed challenging a content of a circular issued by any authority, rather it can challenge only a policy matter or methodology matter, the lawyer argued.

The writ petition over the Bangladesh Bank (BB) circular didn't challenge any policy matter, he added during the hearing on the writ petition at the High Court (HC).

Mr Hossain also argued that Bangladesh Bank is empowered by the statute to formulate and implement such a circular.

Meanwhile, advocate Manzill Murshid, on behalf of the Human Rights and Peace for Bangladesh (HRPB), the writ petitioner, submitted a supplementary affidavit to the HC, praying for the terms of the reference of an inquiry commission.

A commission is needed to fully find out the main challenges, problems and weakness of the banking sector (public and private), to indentify the main factors behind the loan default culture, and to recommend ways to stop such default culture in the banking sector, said the new affidavit.

"It will examine the law, rules of the banking sector and circular issued by the Bangladesh Bank and find out the lacuna and also recommend the appropriate provisions which need to be introduced," it added.

"It will find out whether the autonomy of the central bank is being interfered/curtailed by any authority in any manner," the new affidavit reads.

After the lawyers' submission, the HC bench of Justice JBM Hassan and Justice Md Khairul Alam adjourned the hearing until Monday.

Following a writ petition filed by the Human Rights and Peace for Bangladesh (HRPB), the same HC bench on July 23 issued a rule asking the authorities concerned of the Bangladesh Bank and the government to explain in 10 days as to why the circular issued on May 16 giving privilege to the loan defaulters should not be declared illegal.

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