Organization : National Horticulture Board
Service Name : One Time Settlements OTS Scheme
Country: India
One Time Settlements OTS Scheme : https://www.statusin.in/uploads/21188-ots-scheme-guidelines.doc
Home Page : http://nhb.gov.in/Default.aspx?&menu.Menu=2
One Time Settlements OTS :
It is felt that a realistic approach is needed to reduce the stock of existing chronic default loan accounts.
It has, therefore, been decided to issue guidelines for compromise settlement of chronic default loan accounts which provide a simplified non-discretionary mechanism for amicable recovery of amounts locked up in such loan accounts.
Related : National Horticulture Board Track Your Nursery Application Status : www.statusin.in/10389.html
1. Applicability :
a)The guidelines apply to loan accounts other than those where the payment is secured by bank guarantee and state government guarantee.
b) The scheme will cover loans, which are in default as on 31.03.2005 and have continued to be in default for a minimum period of three years before this date.
c)These guidelines will also cover cases pending before courts/DRT/BIFR subject to condition that the Managing Director shall be the competent authority for keeping any case in abeyance by moving an application before the concerned Court with the prayer for adjourning the suits sine-die. However, after the entire settlement amount has been realized as per guidelines, the Managing Director shall be the Competent authority to withdraw the civil suit.
d) The accounts which fulfill the criteria in these guidelines will be eligible for one-time settlement under the guidelines and such accounts are referred hereinafter as Chronic Default Loan Accounts (CDLAs)
(e) (i) The scheme will not, however, cover cases of fraud, malfeasance and willful default
(ii)The Debt Settlement Advisory Committee (DSAC) as constituted by the Managing Director would examine and recommend whether the borrower has not committed willful default and is eligible for the OTS scheme.
(f) The National Horticulture Board may reject any application for one time settlement (OTS) without assigning any reason.
2. Settlement Amount and payment :
a) If the borrower pays the entire amount in one lump sum upfront at the time of settlement, the settlement amount will be the principal amount outstanding as on the date of settlement.
b)(i) If the borrower pays the entire amount in more than one installment within two years, the settlement amount will be the principal amount outstanding as on the date of settlement.
(ii)25% of the settlement amount will be paid upfront and the balance of 75% will be payable in installments within a period of two years together with service charges @ 4% per annum from the date of settlement upto the date of final payment of the amount of settlement as reduced by the amount paid upfront and the installments paid on respective due dates.
(iii)Where borrower chooses to pay the settlement amount in installments, the borrower will be required to furnish bank guarantee in respect of each of the installments together with service charges.
However, in cases, where the borrowers is not in a position to furnish bank guarantee, the Managing Director may, in his discretion, permit the parties to approach the concerned Court with an application under Order 23 Rule 3 of the Code of Civil Procedure stating the terms of the Settlement with prayer to the Court to record the compromise and pass a decree in accordance therewith.
Further in such cases, the guarantors shall, prior to filing of the application under Order 23 Rule 3 of the Code of Civil Procedure, furnish list of their assets with an affidavit. In the event of borrower/guarantors failure to comply with the terms of the settlement/compromise decree, National Horticulture Board will be free to get the decree executed as per law against the borrower as well as guarantors.
iv) Where the borrower requests for release of any security for the purpose of its sale and the application of the proceeds of sale in the payment of the installment under OTS, such security may be released subject to prior approval of Managing Director, and only after the borrower furnishes Bank guarantee for the amount of the settlement amount remaining unpaid together with service charges payable and verification of the bank guarantee obtained from the issuing Bank.
3. Sanctioning Authority :
The decision on the one-time settlement and the consequent sanction of waiver, remission or write-off would be taken by Managing Director within these guidelines.
4. Non-discretionary treatment :
The guidelines for one-time settlement should be followed without discrimination regarding the amount to be recovered as per the provisions of guideline no. 2. A report on the progress and details of settlement should be submitted by the Managing Director to the Managing Committee.