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IN THE HIGH COURT OF ORISSA AT CUTTACK
Jaswant Singh, M. S. Sahoo, JJ.
M/s. Archana Enterprises, Khordha & Anr. – Appellants
Versus
State Bank of India, Credit And Npa, Rdo R-3, Zone-1, Bhubaneswar, Districtkhurda & Anr. – Respondents
Writ Petition (C) No. 14149 of 2022
Decided On : 10-01-2023
SARFAESI Act - Loan Settlement - The court dismissed the Writ Petition as infructuous after the petitioner settled the loan dues under the SBI One Time Settlement (OTS) Scheme, 2021.
Fact of the Case:
The petitioner sought an extension of the time period for payment of the OTS amount, but later withdrew the Writ Petition after settling the loan dues with the bank.
Finding of the Court:
The court dismissed the Writ Petition as infructuous after the petitioner settled the loan dues under the OTS Scheme, and the bank issued a No Dues Certificate.
Issues: Extension of time for OTS payment, return of original documents by the bank.
Ratio Decidendi: The settlement of loan dues under the OTS Scheme rendered the Writ Petition infructuous.
Final Decision: The Writ Petition stands dismissed as infructuous.
JUDGMENT
1. It is claimed that the loan account of the petitioners, which was classified as NPA and recovery process initiated under the SARFAESI Act, 2002 stood settled at Rs.44,84,318.77/- towards full and final settlement of the loan dues of the petitioners under the SBI One Time Settlement (OTS) Scheme, 2021. The petitioner is stated to have deposited the first upfront amount of Rs.4,48,500/- on 21st February, 2022 at the time of sanction, the first instalment of Rs.4,48,500/- on 23rd March, 2022, however, the second instalment of the aforesaid similar amount though was required to be deposited by 23rd April, 2022 but could not be deposited due to hospitalization of the petitioner. However, subsequently, the same was deposited on 17th May, 2022.
2. The prayer in the present Writ Petition is for extending the time period of payment of the part of the OTS amount as per the sanctioned OTS.
3. At the time of hearing, learned counsel for the petitioners has filed a memo dated 10.01.2023 (which is taken on record) seeking an unconditional withdrawal of the present Writ Petition, which is reproduced below:
' That, during the pendency of the Writ Petition, vide No.14149/2022, the petitioner has approached the Opp. Party, and, both the parties arrived upon a settlement under OTS. The petitioner has paid the entire settlement amount of Rs.46,00,000/- to the Opp. Party Bank on dt.17.10.2022, and thereafter the Opp. Party Bank has issued the No Dues Certificate. Even though the bank has returned most of the Original Documents, but still, the Bank has not returned the allotment letter no.6804 dt.26.03.2015 and original ground rent receipt no.23W6997.
In such circumstances, the Writ Petition has become infructuous and the petitioner prays for withdrawal of the Writ Petition.'
4. In view of the memo filed, the present Writ Petition stands dismissed as infructuous.
Settlement of loan dues under the OTS Scheme renders the Writ Petition infructuous.
The court can extend the time for repayment under an OTS scheme, considering the impact of external factors such as the COVID-19 pandemic and the borrower's efforts to raise funds for repayment.
The decision reaffirms that the grant of benefit under the OTS is subject to the eligibility criteria and the commercial wisdom of the bank, and highlights the availability of alternative remedies un....
The judgment establishes the court's power to grant extension of time for payment under the OTS, based on the RBI guidelines and the principles of equity and justice.
The SARFAESI Act provides specific remedies for grievances, and borrowers do not have a vested right to One Time Settlement benefits, which are subject to the bank's discretion.
The duty of a litigant to disclose all material facts and the bank's right to protect its recovery were the central legal points established in the judgment.
No borrower has a vested right to compel a bank to accept a One Time Settlement, as banks retain discretion in recovery matters.
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