- 1 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 14TH DAY OF JANUARY, 2026 BEFORE THE HON'BLE SMT. JUSTICE LALITHA KANNEGANTI WRIT PETITION NO. 8194 OF 2022 (GM-DRT) BETWEEN: MRS N K SHEEBA W/O M.K.RAVICHANDRA R/AT SHARANYA NILAYA 1ST CROSS, RAKSHANAPURAM EXTENSION, HASSAN, HASSAN DISTRICT - 573 201 …PETITIONER (BY SMT. REVATHY ADINATH, ADVOCATE FOR SRI. ADINATH NARDE, ADVOCATE) AND: 1. THE STATE BANK OF INDIA ARMB BRANCH, BENGALURU AND ALSO HAVING ITS LOCAL HEAD OFFICE, AT ST. MARKS ROAD, BENGALURU - 01 2. THE AGM, Digitally signed by MEGHA MOHAN Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 2ND FLOOR, A BLOCK BKG COMPLEX, MYSORE BANK CIRCLE, AVENUE ROAD, BENGALURU - 560 009 …RESPONDENTS (BY SRI. FRANCIS XAVIER, ADVOCATE FOR R1 R2 IS SERVED) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO CONSIDER THE REPRESENTATION DATED 06.03.2022 VIDE ANNEXURE-B AND REPRESENTATION DATED 24.03.2022 VIDE ANNEXURE-D ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE SMT. JUSTICE LALITHA KANNEGANTI - 3 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 ORAL ORDER The present writ petition is filed seeking the following prayer: "a. Issue a writ in the nature of mandamus or any other appropriate writ against the Respondents to consider the representation dated 06.03.2022 vide Annexure-B and representation dated 24.03.2022 vide Annexure-D. b. To pass order for quashing the Application in OA No.482/2020 filed by the Respondents against the Petitioner which is still pending for consideration in the file of Debt Recovery Tribunal (DRT-2) in view of the OTS-Annexure -A. c. Pass any such order or direction that this Hon'ble court may deems fit to pass in the circumstances of the case." 2. It is the case of the petitioner that the petitioner has availed a housing loan for a sum of Rs.30,00,000/- from the State Bank of Mysore on 02.01.2014 by mortgaging the house property belonging to the petitioner dated 02.02.2014. Due to the Covid-19 pandemic, the petitioner could not repay the loan amounts in a time bound manner. Consequently, the respondent/Bank has declared the loan account of the petitioner as Non- Performing Asset (NPA). According to the petitioner, as on the date of filing of the petition, the petitioner - 4 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 has repaid an amount of Rs.17,63,093/. Thereafter, the respondent/Bank has initiated the recovery proceedings by filing OA No.482/2020 against the petitioner and her husband before the Debt Recovery Tribunal at Bengaluru (for short 'Tribunal') seeking recovery of an amount of Rs.53,96,617/- along with interest at the rate of 14.15% per annum. 3. The petitioner approached the respondent/Bank by submitting a representation dated 06.03.2022 seeking One- Time Settlement (for short 'OTS') of the loan account. Respondent No.2 by reply dated 15.03.2022, requested the petitioner to submit a proposal acceptable to the respondent No.2. Accordingly, the petitioner by letter dated 24.03.2022, submitted proposal that the petitioner is ready to pay an amount of Rs.25,00,000/-, as One-Time Settlement. However, the respondent/Bank has not responded to the said proposal. Hence, the petitioner has been constrained to approach this Court. Learned counsel appearing for the petitioner submits that on 21.06.2022, a Co-ordinate Bench of this Court passed an order directing the respondent/Bank not to precipitate the recovery action against the petitioner, subject to the petitioner - 5 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 depositing a sum of Rs.15,00,000/- within two weeks from the date of the order and continuing to pay the installments, failing which, the interim order would stand automatically rescinded. The said interim order was extended from time to time. 4. Subsequently, on 30.07.2025, another order came to be passed by a Co-ordinate Bench of this Court, which reads as follows: "The learned counsel for the petitioner submits that the petitioner has complied the interim order dated 21.06.2022. She submits that thereafter the petitioner has been servicing the loan. She also contends that as on date, the respondent/bank claims that a sum of Rs.30,00,000/- is outstanding and that the petitioner is willing to deposit the same. The learned counsel for the respondents though admits the petitioner deposited a sum of Rs.15,00,000/- as per the order dated 21.06.2022 and submits that the petitioner cannot compel the respondents to work out the One-Time Settlement Scheme. He contends that the writ petition is not maintainable. Since the proceeding is already initiated before the DRT. In view of the unconditional undertaking of the petitioner that she would deposit a sum of Rs.30,00,000/-, the petitioner is directed to deposit the said sum with the respondent No.1 within one month. - 6 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 Learned counsel for the respondents further submits that the due as on date is not Rs.30,00,000/- but it is Rs.85,81,723/-. Interim order granted earlier is extended till the next date of hearing." 5. Learned counsel appearing for the petitioner submits that, till date, petitioner has paid an amount of Rs.45,00,000/-, whereas at the time of filing the Original Application, the outstanding amount was Rs.53,96,617/-. When the matter came up on last occasion, the learned counsel appearing for the respondent/Bank submitted that the outstanding amount as on date is Rs.85,81,723/-. It is submitted that on what basis they have come to such conclusion, what is the interest they have charged and how they have arrived at such amount. There is no basis for it. Till now, the petitioner is not given any break up and how they have calculated and arrived at that amount. It is submitted that when the petitioner is ready to pay for OTS and have already paid substantial amounts, the respondent/Bank ought to have considered the case of the petitioner for the OTS. - 7 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 6. Learned counsel appearing for the respondent/Bank submits that when the matter was heard on the last occasion it was stated that the outstanding amount was Rs.85,81,723/- as on date but not Rs.30,00,000/-. It is submitted that after initiation of recovery proceedings, the petitioner has filed this petition and obtained an interim stay of further proceedings, due to which the Bank could not proceed with the Original Application. What all the contentions that are raised before this Court with regard to the interest or about the amounts which are without any basis and all these issues can be agitated before the Tribunal in the pending OA and the petitioner without contesting the pending OA cannot come before this Court. 7. It is further submitted that the Petitioner submitted a representation dated 06.03.2022 seeking OTS and by communication dated 15.03.2022, the Bank informed the Petitioner that if she desired OTS, she should submit a proposal acceptable to the Bank. Accordingly, the Petitioner submitted a proposal dated 24.03.2022 stating that she is ready to pay an amount of Rs.25,00,000/-. The said proposal was not accepted - 8 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 by the Bank and was rejected on 06.04.2022. The Hon’ble Apex Court, while considering its earlier judgment in Bijnor Urban Cooperative Bank Ltd. vs. Meenal Agarwal,1 has observed that: “(i) No borrower can, as a matter of right pray for a grant for the benefit of One-Time Settlement Scheme; (ii) No writ of mandamus can be issued by the High Court in exercise of Article 226 of the Constitution of India, directing the financial institution/Bank to positively grant a benefit of OTS to a borrower; (iii) The grant of benefit of OTS scheme is subject to the eligibility criteria and the guidelines issued from time to time.” 8. It is therefore submitted by the learned counsel appearing for the Bank that the reliefs sought for by the Petitioner in the present writ petition are not maintainable. The Petitioner may be relegated to the remedy available before the Tribunal by contesting the Original Application pending therein and the writ petition is liable to be dismissed. 1 (2023) 2 SCC 805 - 9 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 9. Having heard the learned counsels on either side, perused the material on record. The first prayer that is sought by the petitioner with regard to grant of OTS, in the light of the law laid down by the Hon’ble Apex Court in Meenal Agarwal’s case referred supra no writ of mandamus can be issued directing the Bank to grant OTS and therefore, such a prayer cannot be entertained by this Court. 10. Coming to the contention of the Petitioner regarding the outstanding amount claimed by the Respondent/Bank, it is submitted that despite payment of an amount of Rs.45,00,000/-, the outstanding amount, as per the latest instructions, is stated to be Rs.61,53,391/- as on date. The petitioner is at liberty to raise all these issues before the Tribunal in the pending OA and the respondent/Bank shall come up with their response and the Tribunal shall consider the OA considering the respective contentions of both the parties. The OA is filed in the year 2020 and in view of the interim order granted by this Court, the same is pending before the Tribunal. Hence, considering the dispute between the parties and the fact - 10 - HC-KAR NC: 2026:KHC:2179 WP No. 8194 of 2022 that the secured asset is a residential property, this Court deems it appropriate to pass the following: ORDER i. The Debt Recovery Tribunal is requested to dispose of O.A. No.482/2020 within a period of three months from the date of receipt of a copy of this order. Till the Tribunal passes final orders in the said Original Application, the Respondent/Bank shall not take any coercive steps against the Petitioner. ii. Accordingly, the writ petition is disposed of. iii. All I.As. in this petition shall stand closed. SD/- (LALITHA KANNEGANTI) JUDGE SMC List No.: 1 Sl No.: 22