As the banks and other financial institutions were finding it difficult to realize their monies from the defaulting borrower s the Government of India has constituted what are known as Debt Recovery Tribunals under a special law in the parliament known as;
“The Recovery of Debts Due to Banks and Financial Institutions Act, 1993,” also known as the RDDBFI Act or RDB Act is aimed at helping Banks, Financial Institutions and State Financial Corporations to recover their dues quickly.
The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 empowers to the Government to set up Debts Recovery Tribunal (also known as DRT). Each Debts Recovery Tribunal has Recovery Officers who go about the job of auctioning of assets for the recovery of dues adjudicated by the Debts Recovery Tribunal.
Debts Recovery Tribunals are basically like any other civil courts, but with some differences. Unlike in civil courts, there are no separate execution proceedings in Debts Recovery Tribunal for auction of assets. The recovery process is dove-tailed into the adjudication process of the Debts Recovery Tribunal itself.
All auctions by Debts Recovery Tribunal is conducted by the Recovery officer of the Debts Recovery Tribunal, or by an officer authorized by him, generally a Recovery Inspector. In some cases, Commissioner or advocate-Commissioner is appointed who conducts the auction for and on behalf of the Recovery Officer of the Debts Recovery Tribunal. The setting up of a Debt Recovery Tribunal is dependant upon the volume of cases. Higher the number of cases within a territorial area, more Debt Recovery Tribunal would be set up.
Each Debt Recovery Tribunal is presided over by a Presiding Officer. The Presiding Officer is generally a judge of the rank of Dist. & Sessions Judge. A Presiding Officer of a Debt Recovery Tribunal is assisted by a number of officers of other ranks, but none of them need necessarily have a judicial back ground. Therefore, the Presiding Officer of a Debt Recovery Tribunal is the sole judicial authority to hear and pass any judicial order.
Each Debt Recovery Tribunal has two Recovery Officers. The work amongst the Recovery Officers is allocated by the Presiding Officer. Though a Recovery Officer need not be a judicial Officer, but the orders passed by a Recovery Officer are judicial in nature, and are appealable before the Presiding Officer of the Tribunal.
The Debt Recovery Tribunal are governed by provisions of the Recovery of Debt Due to Banks and Financial Institutions Act, 1993, also popularly called as the RDB Act. Rules have been framed and notified under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. After the enactment of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interests Act (SRFAESI Act or SRFAESIA for short) borrowers could become first applicants before the Debt Recovery Tribunal. Earlier only lenders could be applicants.
The Debt Recovery Tribunal are fully empowered to pass comprehensive orders like in Civil Courts. The Tribunal can hear cross suits, counter claims and allow set offs. However, they cannot hear claims of damages or deficiency of services or breach of contract or criminal negligence on the part of the lenders.
The Debt Recovery Tribunal can appoint Receivers, Commissioners, pass ex-parte orders, ad-interim orders, interim orders apart from powers to Review its own decision and hear appeals against orders passed by the Recovery Officers of the Tribunal.
The recording of evidence by Debt Recovery Tribunal is some what unique. All evidences are taken by way of an affidavit. Cross examination is allowed only on request by the defense, and that too if the Tribunal feels that such a cross examination is in the interest of justice. Frivolous cross examination may be denied. There are a number of other unique features in the proceedings before the Debt Recovery Tribunal all aimed at expediting the proceedings.
Initially this has worked well and suddenly there was a spurt in the number of cases where the money was realized and banks to their delight found that the number of NPAs where recovery is coming through is increasing. But the euphoria of the banks was short lived as big borrowers soon were able to find loopholes in the procedures of DRTs and started to utilize these shortcomings to their advantage. The cue was taken up by others as well and soon the banks found themselves again at the receiving end.
In order to overcome this challenge a special act called ” Securitization And Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 (SARFAESi ) was enacted. Once a loan/debt is classified as NPA, the bank/financial institution, under this act, through the Authorized Officer appointed for this purpose by the bank/financial institution under the provisions of this act, can issue notice to the borrower giving him time of 60 days to settle the loan/debt and take possession of the property at the end of the period if the matter remains unsettled. This is called “foreclosureâ€. The bank will proceed to sell the property and realize its dues through bank auction again in accordance with the procedure prescribed under this act.
The law stipulates that the borrower can go for an appeal against the bank/financial institution if he can prove that the bank/financial institution’s actions are biased or it has not acted diligently. This appeal has to made to the Debt Recovery Appellate Tribunal. This has resulted in the DRTs donning the role of an abdjudicator. At present the following Debt Recovery Appellate Tribunals and Debt Recovery Tribunals are working in India:
The Tribunals and Appellate Tribunals details are furnished below:
South India :
Debt Recovery Appellate Tribunal Chennai:- The Tribunal has been constituted vide notification GSR No: 134(E) 17-2-2000 . The territorial jusrisdiction of the Hon`ble Tribunal covers Over Debt Recovery Tribunal Bangalore, Debt Recovery Tribunal Chennai-1, Debt Recovery Tribunal Chennai-2, Debt Recovery Tribunal chennai-3, Debt Recovery Tribunal Coimbatore, Debt Recovery Tribunal Hyderabad, Debt Recovery Tribunal Vishakapatnam, Debt Recovery Tribunal Ernakulam and Debt Recovery Tribunal Madurai.
Debt Recovery Tribunal- 1 Chennai:- The Tribunal has been constituted vide notification GSR No: 508 (E) dated 04.11.96. The territorial jusrisdiction of the Hon`ble Tribunal covers Area under Egmore-Nungambakkam and Mylapore-Triplicane Taluk limits of Chennai and Union Territory of Pondicherry.
Debt Recovery Tribunal – 2 Chennai:- The Tribunal has been constituted vide notification GSR No: 258 (E) dated 29.03.2001. The territorial jusrisdiction of the Hon`ble Tribunal covers Areas Under Tondiarpet and Mambalam – Guindy Taluk limits of Chennai.
Debt Recovery Tribunal – 3 Chennai:- DRT-3 Chennai was eastablished vide GSR No. 15(E) dated the 9th January, 2007. The territorial jusrisdiction of the Hon`ble Tribunal covers Areas under Perambur-Purasawalkam Taluk limits of Chennai and Districts of Kanchipuram, Tiruvallur, Vellore, Villupuram, Cuddalore, Tiruvannamali, Pudukottai, Thanjavur, Thiruvarur, Nagapattinam, Perambulur and Charmapuri in the State of Tamil Nadu.
Debt Recovery Tribunal Coimbatore:- The Tribunal has been constituted vide notification GSR No: 221 (E) dated 22.3.2002. The territorial jusrisdiction of the Hon`ble Tribunal covers Districts of Coimbatore and Nilgiris in the State of Tamil Nadu.
Debt Recovery Tribunal Madurai:- The Tribunal has been constituted vide notification G.S.R 15(E) dated the 9th January, 2007. The territorial jusrisdiction of the Hon`ble Tribunal covers Districts of Madurai, Kanyakumari, Tirunelveli, Tuticorin, Virudhunagar, Sivaganga, Ramnad, Theni, Erode, Salem, Namakkal, Trichy, Karur and Dindigul in the State of TamilNadu.
Debt Recovery Tribunal Ernakulam:- The Tribunal has been constituted vide notification GSR No: 397 (E) dated 4.10.1999. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Kerala & Lakshadweep.
Debt Recovery Tribunal Bangalore:- The Tribunal has been constituted vide notification GSR No: 832 (E) dated 30.11.1994 . The territorial jusrisdiction of the Hon`ble Tribunal covers State of Karnataka .
Debt Recovery Tribunal Hyderabad:- The Tribunal has been constituted vide notification GSR No: 647 (E) dated 21.9.1999. The territorial jusrisdiction of the Hon`ble Tribunal covers Adilabad, Anantapur, Chittoor, Cuddapah, Hyderabad, Kurnool, Khammam, Karim Nagar, Mehbubnagar, Medak, Nalgonda, Nizamabad, Rangareddi, & Warangal districts of Andhra Pradesh and remaining areas of Andhra Pradesh not covered in the jurisdiction of DRT Vishakhapatnam.
Debt Recovery Tribunal Visakhapatanam:- The Tribunal has been constituted vide notification GSR No: 112(E) dated 26-2-2002. The territorial jusrisdiction of the Hon`ble Tribunal covers East Godavari, West Godavari, Guntur, Kirshna, Nellore, Praksam, Srikakulam, Vizianagaram & Vishakapatnam districts of Andhra Pradesh.
West India :
Debt Recovery Appellate Tribunal Mumbai:- The Tribunal has been constituted vide notification GSR No: 654(E) 17-7-1994 . The territorial jusrisdiction of the Hon`ble Tribunal covers over Debt Recovery Tribunal Ahmedabad, Debt Recovery Tribunal Aurangabad, Debt Recovery Tribunal Mumbai-1, Debt Recovery Tribunal Mumbai-2, Debt Recovery Tribunal Mumbai-3, Debt Recovery Tribunal Nagpur and Debt Recovery Tribunal Pune.
Debt Recovery Tribunal – 1 Ahmedabad:- The Tribunal has been constituted vide notification GSR No: 88 (E) dated 21.12.1994. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Gujarat and Union Territories of Dadra & Nagar Haveli, Daman & Diu.
Debt Recovery Tribunal – 2 Ahmedabad:- The DRT-2 Ahmedabad has been constituted by the Central Government.
Debt Recovery Tribunal-1 Mumbai:- The Tribunal has been constituted vide notification GSR No: 524 (E) dated 16.7.1999. The territorial jusrisdiction of the Hon`ble Tribunal covers City Area of A Ward as defined by Mumbai Municipal Coropration bounded as below excluding areas of Nariman Point :- East : Dock area, Ballard Estate, Shahid Bhagat Singh Road, P.Demello Road West :Marine Drive North : Anandilal Poddar Marg, Lokmanya Tilak Marg South : Colaba.
Debt Recovery Tribunal-2 Mumbai:- The Tribunal has been constituted vide notification GSR No: 945(E) dated 29.12.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers Nariman Point in A ward bounded as south : Arabian Sea & Nathalal Parekh Marg West : Dorabjee Tata Road North : Madam Cama Road East : Maharshi Karve Road and B ward to G Ward ie; excluding the areas of jurisdiction of Mumbai DRT No.1 and excluding Suburban & extended suburban areas of Greater Bombay.
Debt Recovery Tribunal-3 Mumbai:- The Tribunal has been constituted vide notification GSR No: 945(E) dated 29.12.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers Areas of H Ward to T Ward ie; Suburban & extended Suburban areas of Greater Bombay and districts of Thane, Raigad, Ratnagiri and Sindhudurg in Maharashtra state and the state of Goa and any other areas of Mumbai not covered by Mumbai DRT No.1 & Mumbai DRT No.2.
Debt Recovery Tribunal Nagpur:- The Tribunal has been constituted vide notification GSR(E) 945 dated 29-12-2000. The territorial jusrisdiction of the Hon`ble Tribunal covers Nagpur, Bhandara, Gondiya, Amravati, Chandrapur, Yavatmal, Gadchiroli, Akola, Buldhana, Washim & Wardha districts of Marashtra State.
Debt Recovery Tribunal Pune:- The Tribunal has been constituted vide notification GSR No: 884 (E) dated 17-12-2001. The territorial jusrisdiction of the Hon`ble Tribunal covers Pune, Satara, Sangli, Kolhapur & Solapur districts of Marashtra State and any other area/district of Marashtra State not included in Mumbai DRT No. 1, Mumbai DRT No. 2 and Mumbai DRT No. 3 and DRTs at Aurangabad and DRT at Nagpur .
Debt Recovery Tribunal Jabalpur:- The Tribunal has been constituted vide notification GSR No: 181 (E) dated 7.4.1998. The territorial jusrisdiction of the Hon`ble Tribunal covers States of Madhya Pradesh and Chhattisgarh.
North India :
Debt Recovery Appellate Tribunal Delhi:- The Tribunal has been constituted vide notification GSR No: 498(E) 26-5-2000 . The territorial jusrisdiction of the Hon`ble Tribunal covers Over Debt Recovery Tribunal Chandhigarh, Debt Recovery Tribunal Delhi-1, Debt Recovery Tribunal Delhi-2, Debt Recovery Tribunal Delhi-3, and Debt Recovery Tribunal Jaipur.
Debt Recovery Appellate Tribunal Allahabad:- The Tribunal has been constituted vide notification GSR No: 5(E) dated 3-1-2001 . The territorial jusrisdiction of the Hon`ble Tribunal covers Over Debt Recovery Tribunal Allahabad, Debt Recovery Tribunal Lucknow and Debt Recovery Tribunal Jabalpur.
Debt Recovery Tribunal Allahabad:- The Tribunal has been constituted vide notification GSR No: 274 (E) dated 31.03.2000 . The territorial jusrisdiction of the Hon`ble Tribunal covers Allahabad, Auraiya, Azamgarh, Ballia, Banda, Basti, Budan, Chandauli, Chitrakut, Deoria, Etah, Etawah, Farrukahabad, Fatehpur, Firozabad, Ghazipur, Gorakhpur, Hamirpur, Jalaun, Jaunpur, Jhansi, Kanauj, Kanpur (Rural), Kanpur (Urban), Kaushambi, Kushinagar, Lalitpur, Haharajganj, Mahoba, Mainpuri, Mau, Mirzapur, Sant Kabir Nagar, Sant Ravi Das Nagar, Sidharthnagar, Sonbhadra, Varnasi districts of Uttar Pradesh & any other area in State of Uttar Pradesh not covered within the jurisdiction of DRTs at Lucknow & Allahabad.
Debt Recovery Tribunal Aurangabad:- The Tribunal has been constituted vide notification GSR No: 909 (E) dated 7.12.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers Aurangabad, Nanded, Jalna, Beed, Parbhani, Hingoli, Dharashiv, Latur, Ahmadnagar, Jalgaon, Dhule, Nandurbar and Nashik districts of Maharashtra state.
Debt Recovery Tribunal Chandhigarh:- The Tribunal has been constituted vide notification GSR No: 258 (E) dated 24.3.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers Himachal Pradesh, Punjab, Haryana and Chandigarh.
Debt Recovery Tribunal-1 New Delhi:- The Tribunal has been constituted vide notification GSR No: 653 (E) dated 5.7.1994. The territorial jusrisdiction of the Hon`ble Tribunal covers South Delhi District Hauz Khas, Malviya Nagar, Mehrauli, Defence Colony, Lodhi Colony, Kotla Mubarakpur, Lajpat Nagar, Srinivas Puri, Hazrat Nizamuddin, Greater Kailash, Chitranjan Park, Ambedkar Nagar, Kalkaji, Badarpur, Okhla, any other police station which may be existing or created in future in this area.
Debt Recovery Tribunal-2 New Delhi:- The Tribunal has been constituted vide notification GSR No: 947 (E) dated 29.12.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers New Delhi DistrictParliament Street, Mandir Marg, Connaught Place , Tilak Marg, Chanakya Puri, Tughlak Road, any other police station which may be existing or created in future in this area.
Debt Recovery Tribunal-3 New Delhi:- The Tribunal has been constituted vide notification GSR No: 48 (E) dated 18.1.2002. The territorial jusrisdiction of the Hon`ble Tribunal covers Central Delhi District :Darya Gunj, Chandni Mahal, Jama Masjid, Kamala Market, Hauz Quazi, I.P.Estate, Pahar Gunj, D.B.G.Road, Nabi Karim, Karol Bagh, Prasad Nagar, Rajinder Nagar, andy other police station which may be existing or created in future in this area North East Delhi District : Seelam Pur, Gokal Puri, Bhajan Pura, Shahdara, Welcome Colony, Manasaravor Park, Seema Puri, Nand Nagri, any other police station which may be existing or created in future in this area. East Delhi District Kalayan Puri, Trilok Puri, Vivk Vihar, Anand Vihar, Preet Vihar , Shakar Pur, Gandhi Nagar, Krishna Nagar, Geeta Colony, any other police station which may be existing or created in future in this area. North Delhi District : Civil Lines, Timarpur, Roop Nagar, Maurice Nagar Colony, Subzi Mandi, Pratap Nagar, Sarai Rohilla, Bara Hindu Rao, Sadar Bazar, Kashmere Gate, Kotwali, Lahori Gate, Town Hall (Chandni Chowk), any other police station which may be existing or created in future in this areaWest Delhi District Patel Nagar, Anand Parbat , Moti Nagar , Tilak Nagar, Janak Puri, Vikas Puri, Punjabi Bagh, Paschim Vihar, Nangloi, Rajouri Garden, Hari Nagar, Kirti Nagar, any other police station which may be existing or created in future in this areaNorth West Delhi District Sultan Puri, Mangol Puri, Kanjahanwala, Ashok Vihar, Saraswati Vihar, Keshav Puram, Shalimar Bagh, Jahangir Puri, Rohini, Narela, Samaipur Badli, Ali Pur, Mukerjee Nagar, Adarsh Nagar, Model Town, any other police station which may be existing or created in future in this area.
Debt Recovery Tribunal Jaipur:- The Tribunal has been constituted vide notification GSR No: 655 (E) dated 30.8.1994. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Rajasthan.
East India :
Debt Recovery Appellate Tribunal Kolkata:- The Tribunal has been constituted vide notification GSR No: 257(E) 24-3-2000 . The territorial jusrisdiction of the Hon`ble Tribunal covers Over Debt Recovery Tribunal Cuttak, Debt Recovery Tribunal Guwahati, Debt Recovery Tribunal Patna, Debt Recovery Tribunal Kolkata-1, Debt Recovery Tribunal Kolkata-2, Debt Recovery Tribunal Kolkata-3, and Debt Recovery Tribunal Ranchi.
Debt Recovery Tribunal-1 Kolkata:-The Tribunal has been constituted vide notification GSR No: 416 (E) dated 27.4.1999. The territorial jusrisdiction of the Hon`ble Tribunal covers Kolkata city covering the areas of the following police station:-Hare Street, Park Street, Shakespeare Sarani, Bowbazar, Muchipara, Taltolla, Hastings, North Port.
Debt Recovery Tribunal-2 Kolkata:- The Tribunal has been constituted vide notification GSR No: 270 (E) dated 20.4.2001. The territorial jusrisdiction of the Hon`ble Tribunal covers Al districts of West Bengal (except Kolkata City) and Andaman & Nicobar Islands .
Debt Recovery Tribunal-3 Kolkata:- The Tribunal has been constituted vide notification GSR No: 84 (E) dated 6.2.2002. The territorial jusrisdiction of the Hon`ble Tribunal covers Kolkata City covering the areas of the following police station:- Shyampukur, Jorabagan, Burtolla, Burrabazar, Posta, Jorasanko, Amherst Street and areas of any other police station which may be created in future in Kolkata City.
Debt Recovery Tribunal Cuttak:- The Tribunal has been constituted vide notification GSR No: 946 (E) dated 29.12.2000. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Orissa.
Debt Recovery Tribunal Guwahati:-The Tribunal has been constituted vide notification GSR No: 7 (E) dated 7.1.1997. The territorial jusrisdiction of the Hon`ble Tribunal covers Assam and other North Eastern States and Sikkim.
Debt Recovery Tribunal Lucknow:- The Tribunal has been constituted vide notification GSR No: 71 (E) dated 31.1.2002 . The territorial jusrisdiction of the Hon`ble Tribunal covers Ambedkar Nagar, Aligarh, Agra, Barabanki, Balrampur, Bahraich, Bareilly, Bijnor, Bulandshahr, Baghpat, Faizabad, Ghaziabad, Gonda, Gautam Budh Nagar, Hathras, Hardoi, Jyotiba Phule Nagar, Lucknow, Lakhimpur, Meerut, Moradabad, Muzafffarnagar, Mathura, Pratapgarh, Pilibhit, Rampur, Rae Bareilly, Sharanpur, Shahajahanpur, Sitapur, Shravasti, Sultanpur, Unnao districts of Uttar Pradesh & State of Uttaranchal.
Debt Recovery Tribunal Patna:- The Tribunal has been constituted vide notification GSR No: 325(E) dated 24-1-1997. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Bihar.
Debt Recovery Tribunal Ranchi:-The Tribunal has been constituted vide notification GSR No: 113 (E) dated 26-2-2002. The territorial jusrisdiction of the Hon`ble Tribunal covers State of Jharkhand.
Once the matter is decided in the favor of the bank/financial institution, the DRT will by itself sell the possessed property through DRT auction. Again here also we in “Foreclosure India.com”, who are the only website in India to give world wide publicity to such properties in India ,assist not only the banks and financial institutions, but also the DRTs in realizing the NPAs and keeping the country’s economy healthy. Several banks which have started utilizing our services are already feeling the difference as they are able to find more participants to their home auctions, other property auctions and are able to affect an increase in sales properties possessed by them. We are also proud that through our efforts only, the market for bank auction properties was created and it is with our efforts that this is being expanded exponentially.