proxy pass encoding % problem

I am using nginx as a reverse proxy. My requirement is nginx needs to pass the url passed by client as-is to the proxy server.
I have set the proxy_pass to hostname:port without the uri part
As per the docs ,If it is necessary to transmit URI in the unprocessed form then directive proxy_pass should be used without URI part

Despite this,nginx does some sort of processing on the uri.The percentages get escaped and are replaced by %25.

Example: Client url - http://10.10.10.10:90/this%2Bthat/

proxy_pass - http://10.10.2.50:8080

Uri sent by nginx after processing - /this%25bthat/

Additionaly,when client passes latin characters like %EA,proxy_pass further encodes to some random value which cannot be processed by the client.
Note that changing charset isn't of much help here.

Any insights,approaches to circumvent this is highly appreciated.