Section 16(1) in The Jammu and Kashmir Debtors, Relief Act 1976
(1)Where, during the hearing of any application made under section 4, any creditor refuses to agree to an amicable settlement, the Board may, if it is of opinion that the debtor has made such creditor a fair offer which the creditor ought reasonably to accept, proceed to record such evidence as the parties may produce and pass such order as may appear to it just and equitable:Provided that if a debtor has paid back to his creditor in cash or kind or both an amount equal to the principal sum and half of the principal sum, the Board shall dismiss all claims shown outstanding against the debtor and all such outstanding shall thereafter be deemed to have been fully discharged:Provided further that if the board finds after due enquiry, that such debtor has paid more than the principal and one-half of the principal, the Board shall pass a decree for the excess amount in favour of the debtor.
