The Supreme Court verdict on a case of default on a bank loan now totalling Rs.1.38 billion taken by a private company, the Mahalaxmi Sugar Mills, has not only kicked up much dust but also triggered a confrontational situation between MPs and some legal experts. The Public Accounts Committee (PAC) is investigating the case, and on Wednesday, lawmakers said the verdict violated the rule of law and lacked public accountability, whereas lawyers like Shambhu Thapa and Harihar Dahal warned against any interference in the independence of the judiciary. As the case was settled by the court on a review petition, it is more or less a closed chapter. PAC cannot overturn the decision. On the other hand, a huge overdue loan is a stark truth. There can be no denying that the people’s money must be recovered. An inquiry into the matter to find out the truth about the default in question or even criticism or denunciation of the court decision is within constitutional limits.

The result of the court decision was that the defendant was taken off the black list of defaulters. This, according to the bankers, will have an adverse impact on the financial system and the economy. According to the Nepal Rastra Bank governor, Bijaya Nath Bhattarai, the court order would make it easier for some 1,500 defaulters to get away. So is the view of the chief executive officer of the Nepal Bank Ltd, John Fitzerald. Rastriya Banijya Bank chairman Dr Bhola Nath Chalise said no borrower can escape loan obligation by selling off his shares. However, Binod Chaudhary of the Chaudhary Group regretted the PAC discussion on a matter already settled by the court. At the same time, whatever corrective action needs to be taken should be taken in accordance with the Constitution and the law, in fairness to the defendant. If the judges concerned have displayed incompetence, misjudgement or failure to discharge the duties of their office in good faith, the House of Representatives can remove them by passing a resolution through an impeachment procedure. Or the parliament could make or amend the law to make sure that no defaulter can get off the hook. No less advisable would be for the apex court to take up another case of loan default and deliver a verdict by a larger bench, setting a precedent for making getting round the loan obligation much more difficult.

What should, however, be borne in mind is that even the court verdict in question has not said that the loan should not be recovered. Nobody can say that. What is of particular importance is the need to plug the loopholes through which borrowers might try to get out of the obligation to repay. It is the duty of the court, a branch of the state, and of course of any judge, to keep the larger interest of society and the economy in mind before taking any decision. If nothing comes out of the PAC activism, a question would arise as to why it decided to take up the matter in the first place. No serious issue should be used by anybody for the sake of mere publicity.