RBI eases curbs on Baghat bank

In a major relief for business account holders of the Baghat Urban Cooperative Bank, which has been operating under Reserve Bank of India (RBI) restrictions, the apex bank has allowed transactions within existing cash credit limits. The decision, announced last evening, has come as a reprieve for hundreds of traders who were struggling to run their businesses despite having sufficient funds in their accounts.

The RBI had imposed restrictions on the bank on October 6, capping withdrawals at Rs 10,000 per account. The move had caused severe hardship to many traders, particularly those involved in the apple and vegetable trade, who conduct their business through the cooperative bank. The fresh relaxation will now enable them to resume their operations and provide the bank with an opportunity to generate income from its lending activity.

Confirming the development, bank’s Managing Director Rajkumar said the relaxation was among several other relief measures sought from the RBI. He added that the bank had managed to bring down its non-performing assets (NPAs) from Rs 137 crore to Rs 132.50 crore through aggressive recovery efforts.

In a parallel development, the Assistant Registrar, Cooperative Societies (ARCS), Solan, has intensified the recovery drive against loan defaulters and their guarantors. Acting under Section 75(A) of the Land Revenue Act, 1954, the ARCS court recently issued an arrest warrant against Vinod Kumar, a resident of Mathiya village in Salogra. Kumar had stood guarantor for M/S Solan Highways, a firm that defaulted on a loan amounting to Rs 3.49 crore. Despite repeated notices, he failed to appear before the court, leading to his arrest by the Solan Police from Ghulut village.

According to Solan SP Gaurav Singh, so far 22 defaulters and guarantors have been declared defaulters by the Baghat Urban Cooperative Bank. Arrest warrants have been issued against all of them. Of the nine defaulters from Solan district, four have been arrested, four have surrendered and one remains at large. Thirteen others, residing in Shimla and Sirmaur districts, are being pursued by local authorities.