The Supreme Court of India has exercised its extraordinary powers under Article 142 of the Constitution to grant relief to a widow, Sumaiya Parveen, who lost her husband during the second wave of Covid-19. The court allowed her to settle a bank loan on relaxed terms and directed the Central Bank of India to release the title deeds of her residential property upon payment of a reduced amount. The loan was availed by her deceased husband, who was the proprietor of FILSA Leathers, and had mortgaged their residential house in Vellore district as security.
The husband passed away in May 2021, and the loan account was classified as a non-performing asset (NPA). The bank had offered a one-time settlement (OTS) of Rs 34.69 lakh against outstanding dues of about Rs 71 lakh, but the widow was unable to pay the balance amount within the stipulated time. The bank then demanded a higher amount and issued a possession notice under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
The Supreme Court observed that while the bank’s demand was “legally sustainable”, strict compliance would cause “extreme hardship” to the petitioner. The court balanced the equities and directed that the ends of justice would be met if the petitioner deposits Rs 33 lakh over and above the upfront amount already paid. The court granted the petitioner eight weeks’ time to deposit the amount, and upon payment, the bank is directed to issue a no-dues certificate and release the original title deeds in favor of the petitioner.
The court made it clear that if the amount is not deposited within the stipulated period, “the law will take its own course”. The relief granted by the court is confined to the peculiar facts of the case and shall not be construed as a precedent to be relied upon against the respondent-bank. The court’s decision is based on “equitable considerations” and is aimed at doing “complete justice” to the petitioner. The case highlights the court’s ability to exercise its powers under Article 142 to provide relief in exceptional circumstances, particularly where there is a need to balance the interests of the parties involved.