IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE NINTH DAY OF SEPTEMBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR. JUSTICE V.V.S.RAO WRIT PETITION No.14566 of 2005 Between: K.Amarnath S/o.K. Narsing Rao, M/s.Shiv Shakti Poultry and Grape Garden, Medchal Mandal, Ranga Reddy District ..... Petitioner AND 1 State Bank of India, rep by Branch Manger, Dabirpur Branch, Medchal Mandal, Ranga Reddy District 2 State Bank of India, rep by Chairman and Managing Director, Mumbai .....Respondents Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to issue a Writ of Mandamus or any other appropriate Writ declaring that the action of the respondents in not considering the case of the petitioner for one time settlement of the loan account Nos.ATL 42 and 43, is arbitrary and illegal and direct the respondents to consider and grant the beneﬁt of one time settlement to the petitioner in respect of the said loan accounts and grant such other relief as it deems ﬁt in the circumstances of the case. Counsel for the Petitioner: MR.V.VENKATARAMANA Counsel for the Respondents: Ms.Ch.Lakshmi Kumari The Court made the following: THE HON’BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.14566 of 2005 ORDER: The petitioner is a partner of M/s.Shiv Shakti Poultry and Grape Garden. The said ﬁrm availed credit facilities from ﬁrst respondent (State Bank of India (S.B.I.), Dabilpur Branch, Medchal Mandal, Ranga Reddy District). An amount of Rs.1,44,000/- under loan account No.ATL-42, and Rs.10,58,000/- under loan account No.ATL-43, were sanctioned and disbursed to petitioner in 1987. Petitioner however could not make much headway due to various problems. His account was irregular. In July and August 2004, he approached ﬁrst respondent for One Time Settlement (OTS) scheme, in vain. In the mean while, ﬁrst respondent ﬁled suit being O.S. No.62 of 1993 on the ﬁle of the Court of II Additional Judge, City Civil Court, Secunderabad, for recovery of loan amount. The suit was transferred to Debts Recovery Tribunal, Bangalore, and from there to Hyderabad. It appears that a recovery certiﬁcate was also issued for an amount of Rs.1,13,055,722/-. Be that as it is, petitioner again made representations for OTS. As first respondent Bank did not consider the same, present writ petition is ﬁled seeking a direction to consider request of petitioner for OTS. The respondents ﬁled counter aﬃdavit sworn to by Branch Manager, S.B.I., Dabilpur Branch. While not specifically denying factual background as above, it is stated that as against outstanding loan amount of Rs.1,20,80,722/-, petitioner came forward oﬀering an amount of Rs.44,00,000/- . Therefore the matter was referred to Controlling Authority, who called petitioner for negotiations. It is also admitted that the Bank is looking at various options for settlement before processing compromise offer. This Court heard learned Counsel for petitioner and learned Standing Counsel for S.B.I. Revised guidelines dated 29.1.2003 for compromise settlement of chronic Non- Performing Assets (NPAs) of public sector Banks, issued by Reserve Bank of India, are placed before this Court. Paragraph (A) thereof deals with coverage. The same does not prohibit OTS with a borrower against whom a decree has been obtained or against whom there are allegations of default. In this case, it is not denied that at least from July 2004 onwards petitioner is approaching ﬁrst respondent for settlement. The allegation of fraud against petitioner is that petitioner mortgaged the same property to ﬁve or six Banks. This cannot be given any credence because no such averment is made in the counter nor any material is placed before this Court. Be that as it is, learned Standing Counsel for S.B.I. submits that if petitioner makes a reasonable oﬀer for settlement, Bank will negotiate with him. Therefore, this Court is of considered opinion that the Bank should explore all possibilities for OTS by giving a counter oﬀer to petitioner. The writ petition is accordingly disposed of, giving liberty to petitioner to approach ﬁrst respondent immediately. First respondent thereafter may negotiate with him and settle the matter under OTS. No costs. ______________ (V.V.S.RAO, J) September 09, 2008 YS 1. State Bank of India, rep by Branch Manger, Dabirpur Branch, Medchal Mandal, Ranga Reddy District. 2. State Bank of India, rep by Chairman and Managing Director, Mumbai 3. Two C.D. Copies.