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Apex Court Grants Relief to Company over OTS Amount as Default of Payment happened due to Covid Pandemic

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Supreme Court Law Insider

Tanvi Pilane

Published on: March 14, 2022 at 11:43 IST

A Supreme Court Bench of Justices Vineet Saran and Aniruddha Bose granted Relief to a Company to pay the One Time Settlement (OTS) amount due to the fact that the default of payment was due to the Covid-19 Pandemic.

The Bench also considered and Special Leave Petition (SLP) assailing the Madras High Court’s Order dated 22.07.2021.

The Petitioner had availed a load from the State Bank of India and failed to repay it within the stipulated time. Due to this, the Petitioner entered into a One Time Settlement (OTS) with the bank in November 2020 under the One Time Settlement (OTS) Scheme.

Approximately 25% of the amount payable under the One Time Settlement OTS Scheme was paid by the Petitioner but defaulted in the payment of the rest of the amount.

Aggrieved by this, the Petitioner approached the Madras High Court seeking an extension of time for a period of 180 days from 29th July, 2021 for the final payment under the One Time Settlement (OTS) scheme.

The Petition was dismissed by the High Court by an order dated July 22, 2021.

The Counsel for the Petitioner submitted that the business was not doing well due to the Covid-19 pandemic and the default of payment was due to the very same reason.

It was also submitted that the Petitioner was going to submit the entire amount due as per the One Time Settlement (OTS) scheme by the 14th of this month. The Petitioner had also paid 12% interest on the defaulted One Time Settlement (OTS) amount within five days thereafter.

The Supreme Court thus granted the Petitioner the liberty to deposit the amount as per the One Time Settlement (OTS) scheme and directed the bank to furnish with three days, the amount of interest due to be paid by the Petitioner at the rate of 12% from the date the amount became due to 14th March, 2022.

The Bench also directed the Petitioner to file the proof of payment of the amount while adjourning the matter for March 21, 2022.

Also read:

What is the process for filing a Special Leave Petition? (civil and criminal)