Kindly advise me on the following issue -
I had taken a business loan about 6 months back for business development. But the business had to be shut down 2 months after taking the loan, as debts were mounting despite best of the efforts to revive the business. My health got deteriorated due to stress and I was couldn't inform the bank about the closure of the business.
I was not having any income source after I shut down the business for 3-4 months. Despite that I had cleared 3 months EMI payments after receiving the bank's notice to pay up in a week's time. This was in Dec'13. Again in Feb'14 I cleared 2 months' installments. In all I cleared 5 months' EMI payments.
Now the bank informs me that I should clear the entire loan amount in 1-2 installment and not clear by making the monthly EMI payments, since the business no longer exists. The total tenure of the loan is 6 years.
Kindly advise me, as per law, is it right that a person should repay the business loan of the bank in one go after his business is shut down? Does the repayment as per the EMI mode of payment, even after the business is shut down, not as per law?