One time settlement- ots of bank loan

Sir/Madam,

My relative had borrowed a loan amount of Rs.30 Lakh 3 years ago against land as collateral from SBI Bank. Now the total amount including principal and interest stands at Rs.37 Lakh.  However, due to the financial pressure, they were not in a position to pay the amount regularly. As a result, the bank started serving notice. My relative approached the court, asking for time to settle the payment. The court has given an order to pay 20% of the amount initially. My doubt is whether the 20% payment is on the total outstanding amount of Rs.37 Lakhs or the Principal amount of Rs.30 Lakh.

Now my relative wants to settle for a one-time settlement by paying the principal amount. Kindly let us now as to the reasonable amount that my relative can negotiate with the bank manager and how much time shall we ask to settle it. With the settlement case pending in the court, my relative is confused as to whether is it advisable to meet the bank manager and discuss about one-time settlement or wait for the court final judgement.

Also, let me know if there are any guidelines set by RBI for one time settlement of loan or is it the banks discretion to decide on OTS.

Kindly give your suggestions.