Supreme Court clarifies that unstated but evident reasons may validate SBI OTS rejection.
Case in NewsSupreme Court Allows Limited Unstated Reasons In Orders clarifying exception to speaking order doctrine in borrower’s OTS dispute . |
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Case Overview
A Bench of Justice Dipankar Datta and Justice AG Masih of the Supreme Court of India addressed the legality of SBI’s rejection of a borrower’s One Time Settlement (OTS) application . The Andhra Pradesh High Court had ordered SBI to reconsider despite the borrower’s defaults and failure to pay 5% of dues upfront under Clause 4(i) of the OTS 2020 Scheme . Though SBI’s rejection order did not mention this ground, the Supreme Court upheld it by invoking an alternative ground visible from the records .
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Key Aspects
The Court limited the circumstances where unstated reasons could be considered . Major facts and issues included :
- Borrower defaulted and did not deposit 5% upfront as per OTS Scheme .
- High Court wrongly directed SBI to review the OTS proposal .
- SBI’s rejection order omitted reference to the upfront condition .
- Issue : Could an unstated but record-based reason justify rejection?
Legal Insights
The Court balanced legality with fairness by referencing established provisions :
- Speaking order doctrine from Mohinder Singh Gill vs. Chief Election Commissioner, (1978) 1 SCC 405 – administrative orders must stand on stated reasons .
- Exception created by the Court: if stated grounds are untenable, a valid alternative ground may be traced from records .
- Reliance on Clause 4(i), OTS 2020 Scheme – mandatory 5% upfront payment condition .
- Article 14, Constitution of India – ensures fairness and natural justice before applying unstated grounds .
- Courts cannot permit new reasons via affidavits/arguments; only traceable grounds from the order’s factual narrative are allowed .
Court’s Verdict
The Supreme Court upheld SBI’s rejection, holding the borrower ineligible due to non-payment of the mandatory 5% deposit . Though not expressly cited, the reason was evident in records . Thus, e Court Allows Limited Unstated Reasons In Orders, subject to satisfaction of the strict three-layer test .
Source – Supreme Court of India
Read also – Constitution of India
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