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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
AJAY MOHAN GOEL
Sohan Singh Kaushal – Appellant
Versus
Himachal Pradesh Financial Corporation – Respondent
Judgment :
Ajay Mohan Goel, J.
By way of this writ petition, the petitioner has, inter alia, prayed for the following reliefs:-
“i) Issue a writ in the nature of certiorari for quashing the order dated 16.08.2023, passed by the respondent Corporation whereby the OTS offer dated 14.11.2022 of the petitioner was declined on evasive grounds; further order dated 11.12.2023, 14.02.2024 and 15.05.2024 by virtue of which representation for reconsideration of the said OTS offer dated 14.11.2022 were also declined, being illegal, arbitrary, perverse and against the Reserve Bank of India Guidelines, in the interest of justice.
ii) Issue a writ in the nature of mandamus directing the respondent Corporation to consider the OTS proposal of the petitioner in accordance with the Reserve Bank of India guidelines according to which the minimum recovery amount is the outstanding amount classified as NPA alongwith nominal interest from the date of classification of the amount till final payment, in the interest of justice.”
2. The case of the petitioner is that the respondent- Corporation had initially sanctioned a Tem Loan of Rs.5.77 lac and Soft Loan of Rs.2.22. lac in August, 1999 for setting up a Rest
A valid One Time Settlement (OTS) proposal must be evaluated on its own merits, considering actual repayments rather than solely asset valuations.
Borrowers cannot claim one-time settlement as a matter of right; financial institutions retain discretion to grant or deny OTS based on public interest and eligibility criteria.
The High Courts have the jurisdiction to extend the period of settlement as originally provided for in OTS letter, subject to certain guidelines, and the Court may consider granting extension of time....
(1) No borrower can, as a matter of right, pray for grant of benefit of One Time Settlement Scheme.(2) No bank can be compelled to accept a lesser amount under OTS Scheme despite the fact that Bank i....
Point of Law : The terms of one-time settlement scheme cannot also be interfered with or varied to the advantage or disadvantage of any person by resorting to the powers under Article 226 of the Cons....
No borrower has a vested right to compel a bank to accept a One Time Settlement, as banks retain discretion in recovery matters.
A borrower must fulfill debt obligations despite financial hardship; equitable relief is not warranted without demonstrable legal rights.
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