Lender bound to give opportunity for hearing to borrower before classifying account as fraudulent: SC

Rejecting the stand of both RBI and the consortium of lenders led by SBI, a Bench led by the Chief Justice said that a decision classifying a borrower's account as fraudulent must be with reasoned order. The classification of accounts as 'fraud' results in civil consequences for borrowers and amounts to blacklisting of borrowers, hence opportunity of hearing must be granted for the borrowers, it said.

from Banking/Finance-Industry-Economic Times https://ift.tt/P43UG1d