MANISH KUMAR SINGH vs UCO BANK

Court
Chhattisgarh High Court

1
2026:CGHC:18659


2026:CGHC:18659
NAFR
HIGH COURT OF CHHATTISGARH AT BILASPUR
WPC No. 2956 of 2025
1 - Manish Kumar Singh S/ Uday Pratap Aged About 45 Years R/o H.
No. 480, Kanhaiyapuri, Kasardih, Durg, District Durg, Chhattisgarh.
... Petitioner(s)
versus
1 - Uco Bank Zonal Office, Chhattisgarh, Eye Hospital Campus, 1st
Floor, Telibandha Raipur, District Raipur, Chhattisgarh.
2 - Branch Manager, Punjab National Bank Borsi Durg, District Durg,
Chhattisgarh.
3 - Branch Head, Uco Bank Civic Center Branch, Bhilai, District Durg,
Chhattisgarh.
... Respondents
(Cause-title taken from the Case Information System)
-----------------------------------------------------------------------------------------------
For Petitioner :- Mr. Anand Bajaj, Advocate
For Respondent No.2 :- Ms. Aprajita Pandey, Advocate on behalf of
Mr. Harshwardhan, Advocate
For Respondents No. 1 & 3 :- Mr. Ravindra Sharma, Advocate
-----------------------------------------------------------------------------------------------
SB- Hon'ble Shri Justice Amitendra Kishore Prasad
Order On Board
23.04.2026

2
2026:CGHC:18659
1. By way of this petition, the petitioner has called in question the
legality and validity of the order dated 30.05.2025 (Annexure P/1)
passed by Respondent No. 3, whereby the request of the
petitioner for settlement of loan under the earlier approved One
Time Settlement (OTS) scheme has not been accepted and a
fresh proposal of higher amount has been insisted upon.
2. The facts, in brief, are that the petitioner had availed a loan of Rs.
25,00,000/- from the respondent Bank, which was subsequently
classified as Non-Performing Asset (NPA). Recovery proceedings
were initiated and a recovery certificate was issued by the Debts
Recovery Tribunal, Jabalpur. It is the case of the petitioner that the
respondent Bank had earlier approved a One Time Settlement
(OTS) on 20.01.2025 for a sum of Rs. 9,00,000/-, out of which Rs.
1,00,000/- was deposited as upfront amount and the remaining
Rs. 8,00,000/- was to be deposited within the stipulated time. The
petitioner submits that due to freezing of his bank account and
delay in release of the order passed by the Debts Recovery
Tribunal dated 28.01.2025 (uploaded on 07.02.2025), he could
not ensure timely transfer of the remaining amount, despite having
taken steps including issuance of cheque. It is further the case of
the petitioner that despite directions issued by this Court in earlier
proceedings to consider his representation sympathetically, the
respondent Bank arbitrarily declined the earlier OTS and insisted
upon a higher settlement amount of Rs. 20,00,000/-.

3
2026:CGHC:18659
3. Following reliefs have been prayed by way of this petition:-
“10.1 The Hon'ble Court may kindly be pleased
to call for the entire records pertaining to the
case of petitioner for its kind perusal.
10.2 The Hon'ble Court may kindly be pleased
to quash/set-aside the impugned order dated
30.05.2025 (ΑΝΝEXURE P/1) and direct the
respondent Bank to settle the loan as per
earlier compromise approval dated 20.01.2025
of Rs, 9,00,000/-.
10.3 That, the respondents may be directed to
de-freeze the PNB account of the petitioner
and to recover the remaining amount of Rs.
8,00,000/- from the petitioner so that the
aforesaid dispute could be settled in
accordance with the compromise approval
dated 20.01.2025.
10.4 That, the Hon'ble Court may kindly be
pleased to grant any other relief, as if may
deem fit and appropriate.”
4. Learned counsel for the petitioner submits that there was no
deliberate default on the part of the petitioner in complying with
the terms of the OTS, and the delay occurred due to
circumstances beyond his control, including freezing of accounts
and delayed release of the Tribunal’s order. It is contended that
the respondent Bank has acted arbitrarily and contrary to the
directions issued by this Court by refusing to honour the earlier
approved settlement and by insisting upon an enhanced amount.

4
2026:CGHC:18659
5. Learned counsel for Respondents No. 1 & 3 (UCO Bank) submits
that the petitioner failed to comply with the terms of the One Time
Settlement (OTS) within the stipulated period and, therefore, the
settlement stood lapsed automatically. It is contended that once
the OTS has failed, no right survives in favour of the petitioner to
seek its enforcement as a matter of course. It is further submitted
that the Bank is well within its jurisdiction to proceed for recovery
of its dues in accordance with law. Learned counsel also submits
that the dispute pertains to recovery proceedings arising out of a
loan transaction, for which an efficacious statutory remedy is
available before the Debts Recovery Tribunal, and thus, the
present writ petition is not maintainable.
6. Learned counsel for Respondent No. 2 (Punjab National Bank)
submits that the role of Respondent No. 2 is limited to compliance
of directions issued by the competent authority regarding the
operation of the petitioner’s bank account. It is submitted that the
account of the petitioner was frozen pursuant to the order dated
17.10.2024 passed by the competent authority, and the said
respondent has acted strictly in accordance with such directions. It
is further submitted that no independent cause of action survives
against Respondent No. 2 in the present proceedings.
7. I have heard learned counsel for the parties and perused the
material available on record.

5
2026:CGHC:18659
8. Upon perusal of the material available on record, this Court finds
that it is not in dispute that the petitioner failed to deposit the
balance amount under the One Time Settlement (OTS) within the
stipulated period. Though the petitioner has sought to explain the
delay on account of freezing of bank accounts and delay in
uploading of the order passed by the Debts Recovery Tribunal,
the fact remains that the terms and conditions of the OTS were
not complied with within the prescribed time frame.
9. It is well settled that a One Time Settlement is in the nature of a
contractual arrangement between the borrower and the Bank, and
strict adherence to its terms is essential. In the absence of
compliance within the stipulated period, the settlement
automatically lapses and cannot be enforced as a matter of right.
Once the OTS has failed, no vested right accrues in favour of the
petitioner to seek enforcement of the earlier settlement amount. In
such circumstances, the appropriate remedy for the petitioner lies
before the competent forum, namely the Debts Recovery Tribunal,
in accordance with law.
10. In view of the aforesaid, this Court is of the considered
opinion that no interference is warranted in exercise of writ
jurisdiction under Article 226 of the Constitution of India.
11. Accordingly, the writ petition stands disposed of.

6
2026:CGHC:18659
12. However, it is observed that the petitioner shall be at liberty
to avail appropriate remedy before the competent forum, including
the Debts Recovery Tribunal, in accordance with law.
13. It is further observed that in case the petitioner deposits the
outstanding loan amount or submits a fresh proposal, the
respondent Bank may consider the same in accordance with law
and applicable policy.
14. No order as to costs.
sd/-
(Amitendra Kishore Prasad)
Judge
Vishakha