New Delhi, Jan 27 (NationPress) In a remarkable use of its powers under Article 142 of the Constitution, intended to deliver complete justice, the Supreme Court has provided relief to a widow who lost her spouse during the second wave of Covid-19. The court has authorized her to settle a bank loan under more lenient conditions and instructed the Central Bank of India to release the title deeds of her home upon payment of a reduced sum.

A bench comprising Chief Justice of India (CJI) Surya Kant and Justice Joymalya Bagchi accepted the special leave petitions (SLPs) submitted by Sumaiya Parveen, who contested the Madras High Court decision that denied the revival of an expired one-time settlement (OTS) proposal regarding a loan taken by her deceased husband.

Recognizing the unusual and unfortunate circumstances surrounding the case, the CJI-led Bench stated that the order was being issued "purely on equitable grounds and by invoking our powers under Article 142 of the Constitution".

In its ruling, the apex court noted that the petitioner’s husband, who owned FILSA Leathers, had taken out credit facilities worth Rs 50 lakh from the Central Bank of India, securing it with their residential property located in Vellore district. He passed away in May 2021 during the second wave of the Covid-19 pandemic, and the loan account remained regular until his death.

"The demise of the appellant’s husband led to further hardships as the account was classified as NPA, leading to proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 being initiated," the bench remarked.

The bank had proposed an OTS of Rs 34.69 lakh against outstanding dues of approximately Rs 71 lakh as of January 2024. The deceased’s wife made the upfront payment of 10 percent, amounting to Rs 3.46 lakh, but was unable to pay the remaining balance within the specified timeframe.

Afterward, the bank requested a higher amount and issued a possession notice under the SARFAESI Act, prompting her to appeal to the Madras High Court, which dismissed her application.

While noting that the bank’s demand was "legally sustainable", the Supreme Court remarked that strict compliance would result in extreme hardship for the petitioner.

"Although the demand from the Bank is legally justified, we believe that meeting this demand would cause extreme distress for the appellant," the CJI-led Bench noted.

In an effort to balance equities, the Supreme Court determined that justice would be served if the petitioner deposits Rs 33 lakh in addition to the upfront payment already made.

"The appellant has been granted eight weeks to pay the amount of Rs 33,00,000, during which further interest will remain suspended. If the appellant pays the amount within the stipulated period, the Bank is mandated to issue a no-dues certificate and return the original title deeds to the appellant," the ruling stated.

However, the apex court clarified that failure to deposit the amount within the designated time frame would mean that "the law will take its own course".

Emphasizing that the relief granted is limited to the specific circumstances of this case, it added that the order "should not be interpreted as a precedent against the respondent-Bank".