The Reserve Bank of India (RBI) on Friday told the Delhi High Court that to avoid delays in the process of withdrawals from scam-hit PMC Bank on hardship grounds, the authority for approving such requests was delegated to the bank.
The submission by the country’s central bank was made in an affidavit filed in the High Court in response to the court’s observation that instead of leaving it to the PMC Bank to decide which emergencies cited by its depositors were to be considered for disbursal of ₹5 lakh to them, the RBI should have been taking the call.
A Bench of Chief Justice D.N. Patel and Justice Prateek Jalan had said that since the RBI has imposed withdrawal restrictions on the Punjab and Maharashtra Cooperative (PMC) Bank, the central bank should have been the one taking the decision on allowing disbursals on hardship grounds.
“The RBI was to apply its mind and not act as a post office. If you [RBI] have imposed the restrictions, then you have to apply your mind. You…