Writing-off non-performing assets (NPAs) or bad loans is a regular exercise conducted by banks to clean up their balance sheet, and achieving taxation efficiency, Minister of State of Finance Shiv Pratap Shukla said in a written reply.
"As per Reserve Bank of India (RBI) data on global operations, public sector banks have written-off (including compromise) an amount of Rs 2.41 trillion from the financial year 2014-15 till September 2017," the minister said.
Writing off loans is done, inter-alia, for tax benefit and capital optimisation, he said.
"Borrowers of such written off loans continue to be liable for repayment," he added.
Shukla said that recovery of dues takes place on an ongoing basis under legal mechanism, including SARFAESI Act and debt recovery tribunals.
"Therefore, write-offs do not benefit borrowers," he added.
The minister said RBI has apprised it that borrower-wise credit information is not available for disclosure.
The RBI Act provides that credit information submitted by a bank should be treated as confidential and not be published or otherwise disclosed.