Arbitration by Baja Finserv

My husband has taken loan from Bajaj Finserv in2018, but during covid the business got shut down and we were not able to give emi, so we went for settlement, but BAja initially said that the letter will say you have to pay settlement in 3 emi but later you will get another letter. After three emi when we were not able to pay full as we already told them also before accepting settlement then they sent the matter to lokadalat, accidentally on the hearing date due to some strike or lawyers we were not able to appear in court as they didn't allowed anyone to go in premises. In parallel we recieved notice for arbitration. When we appeared in arbitration hearing he asked for a response to be sent via physical copy. The loan was for 8.5 lakhs, arbitration is raised for o. 4 lakhs. Settlement was of 3.65 where we have already payed 1.5 lakhs. So now we are confused what to do. In Bajaj no one listen. We are ready for one time settlement but cant pay more than 1.5 lakhs. Bajaj is not accepting this also. Please suggest / guide.