‘Centre Has Failed Kerala’: HC On Refusal To Waive Loans For Wayanad Landslide Victims

The Centre had earlier claimed that there was no legal provision to waive loans for those affected by natural disasters. (File photo)

The Kerala High Court has come down heavily on the Union government for refusing to waive bank loans taken by victims of the devastating Wayanad landslides of 2024.

In a strongly worded order, the Court said that the Centre has “virtually failed” the people of Wayanad by choosing not to exercise its powers to provide relief.

The remarks came after the Central government informed the Court that there is no provision under existing law to waive loans for natural disaster victims, including those affected by the Wayanad tragedy.

Rejecting the Centre’s stance, the Division Bench stated, “By refusing to exercise a power that they have, in a situation that calls for the exercise of that power, we are of the view that the Union Government has virtually failed the landslide victims of Wayanad.”

The Court added that it could not accept the Centre’s position that it was powerless to act in such a situation.

“It has become quite apparent to this Court, therefore, that the Union Government does not intend to exercise its discretion to

direct the banks concerned to waive the repayment of the loan amounts in question, and that is indeed unfortunate,” the Court observed.

Earlier this week, the Court had criticised the Centre for what it described as “bureaucratic babble”, accusing it of hiding behind legal technicalities instead of acting to help citizens in distress.

Now, taking a more concrete step, the Court has made the banks concerned respondents in the case. It has directed them to file affidavits stating, “Whether they are willing to waive, wholly or partially, the loans taken by Wayanad landslide victims.”

“If not, their justification, with reference to the terms of loan agreements for seeking repayment of loan, together with interest, during the pendency of these proceedings,” it added.

The Court has also ordered that any loan recovery actions currently being pursued by the banks against the affected people in Wayanad must be kept on hold until the case is fully heard and decided.

“Recovery action, if any initiated by the additional respondent banks, against the landslide victims in Wayanad shall be kept in abeyance pending final disposal of this writ petition,” the Bench directed.

The matter will be heard again in two weeks.