DEBTS RECOVERY TRIBUNAL

[DR.MARIAPPAN GOVINDARAJAN]

Debt Recovery Tribunal

‘The Recovery of Debts Due to Banks and Financial Institutions Act, 1993’ (‘Act’ for short) provides for the establishment of Tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions and for matters connected therewith or incidental thereto.  It is a quasi-judicial body. 

The Central Government shall, by notification, establish one or more Tribunals, to be known as the Debts Recovery Tribunal (‘DRT’ for short), to exercise the jurisdiction, powers and authority conferred on such Tribunal by or under this Act and also to exercise jurisdiction for entertaining and deciding the applications filed before it.

Presiding Officer

The Central Government shall appoint one Presiding Officer for the DRT to discharge the functions under the Act.  A person who has been a District Judge or is to be qualified as a District Judge.  The tenure of the Presiding Officer is 5 years or up to his age of 62 years whichever is earlier. 

The Central Government may authorise the Presiding Officer of one DRT to discharge the functions of the Presiding Officer of another DRT. 

Salary and allowances

Neither the salary and allowances nor the other terms and conditions of service of the Presiding Officer of a DRT shall be varied to his disadvantage after appointment.

Vacancy

If, for any reason other than temporary absence, any vacancy occurs in the officer of the Presiding Officer of a DRT then the Central Government shall appoint another person in accordance with the provisions of this Act to fill the vacancy and the proceedings may be continued before the Tribunal from the stage at which the vacancy is filled.

Resignation

The Presiding Officer of a DRT may, by notice in writing under his hand addressed to the Central Government, resign his office.  The Presiding Officer of a DRT shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office until the expiry of 3 months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office or until the expiry of his term of officer, whichever is the earliest.

Removal

The Presiding Officer of a DRT shall not be removed from his office except by an order made by the Central Government on the ground of proved misbehaviour or incapacity after inquiry made by a Judge of a High Court.

Staff

The Central Government shall provide the Tribunal with one or more Recovery Officers and such other officers and employees as that Government may think fit.   The Recovery Officers and other officers and employees of a DRT shall discharge their functions under the general superintendence of the Presiding Officer.  The salaries and allowances and other conditions of service of the Recovery Officers and other officers and employees of a Tribunal shall be such as may be prescribed. 

Public Servants

The Presiding Officer of a Tribunal, the Recovery Officer and other officers and employees of DRTs shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code.

Protection

No suit, prosecution or other legal proceeding shall lie against the Central Government or against the Presiding Officer of a DRT or against the Recovery Officer for anything which is in good faith done or intended to be done in pursuance of this Act or any rule or order made thereunder.

Jurisdiction and powers of the DRT

Section 17 provides that a DRT shall exercise, on and from the appointed day, the jurisdiction, powers and authority to entertain and decide applications from the banks and financial institutions for recovery of debts due to such banks and financial institutions.

Bar of jurisdiction

No court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under articles 226 and 227 of the Constitution) in relation to the matters specified in section 17.

Original Application

The Recovery of Debts and Bankruptcy Act, 1993 (RDB Act) provides speedy redressal to lenders and borrowers through filing of Original Applications ‘(OAs’ for short) in DRTs. 

Security Appeals

The Securitisation and Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (‘SARFAESI’ for short) provides access to banks and financial institutions covered under the Act for recovery of secured debts from the borrowers without the intervention of the Courts at the first stage. Securitisation Appeals (‘SAs’ for short) can be filed with the DRTs by those aggrieved against action taken by secured creditors under the SARFAESI.

DRTs in India

There are 39 DRTs all over India. The list of DRTs is as below-

• DRT Allahabad, Dehradun, Jabalpur, Lucknow, Patna and Ranchi.
• DRT Chennai – 1, Chennai – 2, Chennai – 3, Bengaluru – 1, Bengaluru – 2, Coimbatore, Ernakulam – 1, Ernakulam – 2 and Madurai.
• DRT Delhi – 1, Delhi – 2, Delhi – 3, Chandigarh – 1, Chandigarh – 2, Chandigarh – 3 and Jaipur.
• DRT Kolkata- 1, Kolkata – 2, Kolkata – 3, Hyderabad – 1, Hyderabad – 2, Vishakhapatnam, Siliguri, Cuttack and Guwahati.
• DRT Mumbai – 1, Mumbai – 2, Mumbai – 3, Ahmedabad – 1, Ahmedabad – 2, Aurangabad, Nagpur and Pune. 

Representation before DRT

 A bank or a financial institution making an application to a DRT may authorize one or more legal practitioners or any of its officers to act as Presenting Officers and every person so authorized by it may present its case before the DRT.

The defendant may either appear in person or authorize one or more legal practitioners or any of his or its officers to present his or its case before the DRT.

Disposal of cases by DRT

From the year 2017 – 18 to 2024 – 25 the DRT disposes many applications filed by the banks/financial institutions and security appeals filed by the borrowers/guarantees/ third party under SARFAESI Act.  The following table will reveal the details of the Original Applications (Oas) and Securities Appeals (Sas) disposed by DRTs and the amount involved in these cases-

Details of disposal of OAs and SAs by DRTs from 2017 – 18 to 2024-25

Financial year	No. of OAs disposed	Amount involved (in cr)	No. of SAs disposed	Amount involved (in cr.)
2017- 18	26082	67265.7	5851	44045.06
2018 – 19	33224	146903.51	9459	80819.86
2019 – 20	30069	111295.35	10300	64587.03
2020 – 21	8058	26325.38	3754	39187.12
2021 – 22	13069	92020.26	6343	54041.97
2022 – 23	29124	190905.18	13061	92071.75
2023 – 23	36395	164110.44	16146	141684.93
2024 – 25 (upto December 2024)	23088	98017.16	11000	82152.11
Total	199109	890806.98	75914	597589.33

Source: https://financialservices.gov.in/.

DRTs expedite the recovery of debts owed to banks and financial institutions. Before DRTs, recovering loans and debts was a lengthy and complex process. However, DRTs provide a faster, more streamlined system, allowing financial institutions to recover their dues without unnecessary delays.