A borrower has no vested right to demand the benefit of a One-Time Settlement (OTS) scheme, and the High Court cannot issue a writ of mandamus to compel a bank to accept an OTS proposal, as the decision rests upon the bank's commercial wisdom and prudent recovery assessment.

Order

27/03/2026

1. The present writ petition has been filed with the following prayers:-

“It is, therefore most respectfully prayed that the Hon’ble Court may graciously be pleased to call for the entire record, examined the same and allow this writ petition in the interest of justice and;

1) By an appropriate writ, order or direction in the nature thereof, quash and set aside Rejection Letter dated 01.09.2025 issued by Respondents;

2) By an appropriate writ, order or direction in the nature thereof thereby direct Respondent No. 3 Bank to strictly decide the OTS Application of the Petitioner in terms of the RBI Circular dated 08.06.2023 and any policy formulated thereafter in terms of the same.

3) By an appropriate writ, order or direction in the nature thereof thereby direct Respondent No. 3 Bank to place the OTS Proposal of the Petitioner before the Appropriate Authority as per the Board Approved Policy in terms of the Circular dated 08.06.2023 issued by the Respondent No. 2;

4) By an appropriate writ, order or direction in the nature thereof, the Respondent No. 2 be kindly directed to ensure the compliance by the Respondent No. 3 to adhere to the Circulars and Guidelines issued by the Respondent No. 2;

5) By an appropriate writ, order or direction in the nature thereof, Respondent No.3 be called upon to submit the entire records and proceedings done pursuant to OTS application dated 28.05.2025.

6) By an appropriate writ, order or direction in the nature thereof thereby direct the Respondent to refund the sum of Rs.12 Crores deposited by the Petitioner with the Respondent No.3 Bank as per the directions of the Hon’ble High Court of Judicature for Rajasthan, Jaipur;

7) Any other order which this Hon’ble Court considers expedient, just and proper in the facts and circumstances of the case may kindly be granted in favour of the petitioners; and

8) Cost of this writ petition may kindly be awarded in favor of the humble petitioner.”

2. Mr. Archit Bohra along with Ms. Lipi Garg, learned counsel for the petitioners, submit that in pursuance to the order dated 26.02.2026 passed by this Court, the Director of the petitioner visited the Office of the respondents on 13.03.2026 and submitted a One-Time Settlement (hereinafter referred to as ‘OTS’) proposal of Rs.38,00,00,000/-, inclusive of Rs.12,00,00,000/- already deposited towards full and final settlement against the total outstanding dues.

3. Learned counsel submit that the said OTS proposal of the petitioners was rejected by the respondent – Bank primarily on the ground that earlier an OTS proposal of Rs.44,00,00,000/- made by the petitioners was also rejected and thus, there was no occasion for the respondent – Bank to consider an OTS proposal of a lesser amount, and also on the ground that the market value of the securities of the petitioners available with the respondent – Bank is Rs.53,67,00,000/-.

A copy of the minutes of the meeting held on 13.03.2026 was handed over to the Court during the course of arguments.

4. Learned counsel further submit that a bare perusal of the prayers made in the writ petition reveals that the cause of action of the petitioners to approach this Court is the arbitrary rejection of the OTS proposal dated 16.05.2025 made by it, which came to be rejected vide communication dated 01.09.2025 in a whimsical and capricious manner.

5. Learned counsel also submit that vide E-mail dated 25.03.2026, a revised offer of Rs.41,00,00,000/- was submitted by the petitioners to the respondent – Bank, which has not been responded to till date and thus, under no circumstances, it can be sa