Third parties who are neither borrowers nor guarantors are ineligible to avail One Time Settlement (OTS) schemes, especially when the original borrower is under liquidation or subject to a Debt Recovery Tribunal (DRT) decree.

ORDER

This Writ Petition has been filed challenging the order of the Respondents dated 27.01.2022 in Ref. No. SARB / AJI / 589 and to quash the same and consequently direct the appropriate authority of the respondent bank to favourably consider the petitioner’s application dated 15.01.2022 under clause 12(a) at Page No.12 of the respondents SBI OTS Scheme 2021.

2. The case of the petitioner in the nutshell is as follows:

(i) The Petitioners are the widow and minor twin children of late Mr.Lakshmi Narayana Choudhary, who unfortunately purchased the lease hold rights of 354 sq.f.t. of specified land area at No.672/476, Anna Salai, Chennai from a Company viz., Sethuram Thyagarajan Engineers Pvt. Ltd., (STEPL). He also caused to be put up a entire superstructure on the 5th floor admeasuring about 3600 sq.feet in an office complex known as Temple Towers. It comprised of a single module with a single entry and exit and all the toilets and wash rooms are situated on one side only.

(ii) It is further stated that the aforesaid M/s.Sethuram Thyagarajan Engineers Pvt. Ltd. faced winding up proceedings and was ultimately ordered to be wound up in 10.12.1999. The Respondent-Bank had filed a Civil Suit before this Court for recovery of its dues from STEPL and the said Suit later came to be transferred to the Debt Recovery Tribunal at Chennai which passed a decree erroneously on the aforesaid office premises without notice to late Lakshmi Narayana Choudhary. The Respondent-Bank staked a claim based on the order of the DRT-I, Chennai, wherein the lease hold right of the 99 years was said to be mortgaged to the said Bank. Admittedly the original title deed evidencing the lease is not with the Respondent Bank and is now not traceable.

(iii) The Petitioners filed C.A.No.125 of 2011 in C.P.No.103 of 1993 before this Court for validation of the transfer of the lease hold right which took place during the winding up proceedings. The same was disallowed and the appeal filed against the said order in OSA.No.222 of 2013 was also dismissed by order dated 19.03.2020.

(iv) In order to buy peace, the 1st petitioner made several offers to the Respondent Bank. However, the officers of the Respondent-Bank though purportedly wanted to recover some amounts for the Bank could not consent for any viable and amicable settlement. The Respondent-Bank has admitted the existence of private property within the single module.

(v) That by circular dated 15.01.2022 the Respondent-Bank has come out with the present SBI OTS 2021 scheme. The scheme mentions how even “ineligible borrowers” can be considered by the appropriate authority at page No.12 clause 12(a) of the SBI OTS Scheme 2021. Therefore, the petitioner on behalf of the estate of late M.Lakshmi Narayana Choudhary approached the Respondent- Bank by letter dated 15.01.2022 along with cheque dated 15.01.2022 for a sum of Rs.4,52,116/-(which being 10% of the outstanding amount of Rs.49,21,160/-) to avail the scheme and retain the property in memory of late M.Lakhsmi Narayana Choudhary. The Respondent-Bank vide letter dated 27.01.2022 rejected the same by stating that under Clause 2.1(a)(iv) of the OTS scheme, units under liquidation will not be eligible and therefore the borrower company which is under liquidation cannot be covered under the scheme. That apart as per Clause 2.1.(a)(v) of the said Scheme, Units where the decree awarded by DRT will not be eligible. Challenging the said order, the present writ petition has been filed by the Petitioners.

3. The learned counsel for the Petitioners would submit that the order of liquidation against M/