ANDHRA PRADESH

Court directive on Prudential's settlement scheme

Legal Correspondent

HYDERABAD: A Division Bench of the High Court on Monday made it clear that any offer made by defaulters of Prudential Cooperative Bank under the one-time settlement (OTS) scheme will not be given effect till it is approved by the court.

The Division Bench, comprising the acting Chief Justice Bilal Nazki and Justice G. Chandraiah, put this condition while staying the operation of a single judge regarding the appointment of liquidator.

Depositors and shareholders challenged the appointment of liquidator and initiation of the one-time settlement scheme.

They had alleged that it had been made to facilitate big defaulters to get away by paying paltry sums and liquidator had been brought into facilitate such fraudulent act.

A single judge of the court set aside the appointment of liquidator.

The bank and the Government filed writ appeals and the Division Bench on Monday suspended the judgment of the single judge but put the clause that settlements under OTS scheme shall have prior approval from the court.

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