AIROnline 2022 SC 799 – Legal Firms

Reserve Bank of India Act (2 of 1934) , S.45JA— Banking Regulation Act (10 of 1949) , S.35A— Contract Act (9 of 1872) , S.62— Constitution of India , Art.226— One Time settlement (OTS) – Extension of time – To make payment of balance amount due and payable under sanctioned OTS Scheme – Exercise of powers under Art. 226 – Grant of further time to borrower to make balance payment under OTS Scheme in exercise of powers under Art. 226 of Constitution, unsustainable – Moreso when borrower failed to comply with conditions of sanction letter.
AIR 2022 P and H 159, ReversedAIR 2010 SC 218, Distinguished

In the instant case, the appellant Bank challenged judgment of High Court of Punjab and Haryana exercising powers under Art. 226 granted further six weeks’ time to the borrower to make payment of balance amount as per the sanctioned letter of OTS. Bank submitted that grant of benefit of OTS Scheme cannot be claimed as a matter of right and shall always be subject to fulfilling the eligibility criteria mentioned in the scheme. It was submitted that in the present case the borrower was required to fulfil the terms and conditions of the OTS and was required to make the payment as per the schedule mentioned in the sanctioned letter of OTS. It is submitted that any deviation from making the payment as per the sanctioned OTS Scheme would render the OTS sanct….