In Brief
SBI lent money to Tanya Energy Enterprises (respondent) against seven mortgaged properties. After default, SBI initiated recovery proceedings and introduced an OTS (One Time Settlement) scheme in 2020. The respondent applied for OTS on 10 November 2020 without paying the mandatory 5% upfront payment required by the scheme. SBI rejected the application; the respondent challenged this in the High Court. The High Court directed reconsideration, finding the borrower eligible. The Supreme Court reversed this, holding that non-compliance with the mandatory upfront payment condition made the application fundamentally defective and ineligible for processing. The Court upheld the rejection while permitting the borrower to submit a fresh OTS proposal to the Bank outside the expired 2020 scheme.
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