Judgment Intelligence
Petition Dismissed- Court
- Rajasthan High Court
- Date of Decision
- 2 November 2026
- Bench
- Justice Arun Monga and Justice Anuroop Singhi
- Relevant Acts & Sections
- Recovery of Debts and Bankruptcy Act, 1993 — Sections 19(25), 22(2)(e); Debts Recovery Tribunal (Procedure) Rules, 1993 — Rule 5A; Indian Contract Act, 1872 — Section 62; Code of Civil Procedure, 1908 — Order XXIII Rule 3; Insolvency and Bankruptcy Code, 2016 — Sections 7, 17, 19; Constitution of India — Article 226
The special appeal was dismissed and the Single Judge's judgment of 29 August 2025, which had set aside the DRT's order of 23 May 2023, was affirmed; pending applications were disposed of (paras 44-46).
Source Rajasthan High Court, hcraj.nic.in — judgment dated 2 November 2026
Key holdings
- Section 19(25) of the 1993 Act confers limited powers and cannot be used to rewrite a concluded settlement (paras 13-14, 19).
- A consent order based on an OTS can be modified only with both parties' consent or by recalling it and hearing the parties afresh (para 29).
- Time for payment is an essential feature of an OTS, and a period that has already expired cannot be extended (paras 22-23).
- An intra-court appellate Bench interferes only where the Single Judge's judgment is demonstrably erroneous or perverse (paras 41-44).
Judgment digest by NyayVidhan: a summary of the court's judgment, not its text. The judgment itself is the authoritative version.
Brief Facts
Court's Findings
Legal Principle
NyayVidhan's view · Practice note
Why It Matters
For borrowers, the lesson is to keep to the OTS schedule or obtain the bank's extension: once the agreed period lapses, a DRT application blaming the bank for the delay will not revive the settlement unless the consent order is recalled and the dispute heard afresh (paras 24, 29). Accepting money from later sales of mortgaged property was no waiver by the Bank (para 31). For banks, the ruling confirms that a writ court may entertain a challenge to a DRT order passed beyond its jurisdiction although an appeal lies to the Appellate Tribunal (paras 34-36). On the narrow scope of intra-court appeals, the Bench applied the Supreme Court's recent ruling in R. Saravanan v. Periyar University (paras 42-43).
Editorial comment by the NyayVidhan Editorial Desk. It is not part of the Court's judgment and is not legal advice.
Precedents Relied Upon
- Standard Chartered Bank v. Dharminder Bhohi & Ors. (2013) 15 SCC 341
Cited by the Bank for the point that the Tribunal must function within statutory parameters and that Section 19(25) confers limited powers (para 6.1). The Court relied on it, quoting its paragraph 33: the Tribunal has no inherent powers and Section 19(25) confers limited powers which cannot be invoked to confer jurisdiction not vested by the legislature (para 14).
- State Bank of India v. Arvindra Electronics Pvt. Ltd. (2023) 1 SCC 540
Relied on by the Single Judge; the appellant called it distinguishable (para 4.7) and the Bank relied on it (para 6.4). The Court quoted its paragraph 22: directing a bank to reschedule payment under an OTS and granting extension of time amounts to modifying the contract, which can be done only by mutual consent under Section 62 of the Contract Act (para 25).
- Bijnor Urban Cooperative Bank Ltd. & Ors v. Meenal Agarwal & Ors (2023) 2 SCC 805
Called distinguishable by the appellant (para 4.7) and relied on by the Bank (para 6.4). The Court quoted its paragraphs 14-15: a borrower cannot claim an OTS as a matter of right, no mandamus can direct a bank to grant it, and the decision is left to the bank's commercial wisdom (para 26).
View all precedents (14)
- Dayal Singh & Ors. v. Union of India & Ors. (2003) 2 SCC 593
Cited by the Bank (para 6.4). The Court relied on it for the proposition that a concluded contract cannot be novated or modified without the agreement of both parties (para 27).
- Manjunath Tirakappa Malagi and Another v. Gurusiddappa Tirakappa Malagi (Dead through Lrs) 2025 SCC OnLine SC 835
Relied on by the Court for the holding that the only remedy against a consent decree is a recall application before the court that passed it (para 28); the Court then held that a consent order under an OTS can be modified only by consent or by recalling it (para 29).
- Bihar Industrial Area Development Authority and Others v. Scope Sales Pvt. Ltd. and Another 2026 SCC OnLine SC 112 (decided on 23.01.2026)
The Court said it was guided by its principles on intra-court appellate jurisdiction, quoting paragraphs 13-14: interference is warranted only where the Single Judge's judgment is demonstrably erroneous or perverse, not merely because another view is possible (para 41); it applied them in para 43.
- R. Saravanan v. Periyar University 2026 SCC OnLine SC 2202 (decided on 16.10.2026)
Relied on, with its paragraphs 28-29 quoted: a Letters Patent Bench can interfere only where the writ court's findings are demonstrably erroneous and the mistake is glaring, and not with a decision that is just and reasonable (para 42). Applied in para 43.
- Rangnath Haridas v. Dr. Shrikant B. Hegde (2006) 7 SCC 513
Relied on by the appellant for directing parties to perform reciprocal obligations under a consent decree (para 4.4). The Court held it did not assist the appellant, the facts being clearly distinguishable (para 30).
- Smt. Periyakkal and Ors. v. Smt. Dakshyani (1983) 2 SCC 127
Relied on by the appellant for the court's power to extend time under a compromise merged in its order (para 4.8). The Court held it did not apply, none of the appellant's cases concerning a DRT modifying an amended consent recovery certificate beyond its jurisdiction (para 30).
- Assistant Commissioner of State Tax & Ors v. Commercial Steel Ltd. (2022) 16 SCC 447
Cited by the Bank for the point that the rule of alternative remedy does not bar a writ petition where the authority acts without jurisdiction (paras 6.6, 33). The Court stated the principle as well settled and held the writ petition maintainable (paras 34-36).
- PHR Invent Educational Society v. UCO Bank and Ors. (2024) 6 SCC 579
Cited by the Bank with Commercial Steel on the exceptions to the alternative-remedy rule (para 33); the Court stated the principle without discussing the case (para 34).
- State Bank of India & Ors. v. S.N. Goyal (2008) 8 SCC 92
The appellant submitted that the Single Judge wrongly relied on it to hold that the DRT had become functus officio, without considering the power of review (para 4.3). The Court rejected the review argument without discussing the case (para 17).
- Jaipur Vidyut Vitran Nigam Ltd. & Ors v. Adani Power Rajasthan Ltd. & Anr. 2024 SCC OnLine SC 313
Named by the appellant as misplaced, the DRT proceedings not seeking to alter the original order (para 4.7). The Court did not discuss it.
- Ajanta LLP v. Casio Keisanki Kabushiki Kaisha & Anr. (2022) 5 SCC 449
Cited by the Bank for the point that a consent decree cannot be modified unless there is a patent mistake or an allegation of fraud or misrepresentation (para 6.5). The Court did not discuss it.
