What is Debt Recovery Tribunal DRT ?
A Debt Recovery Tribunal DRT functions as a quasi-judicial statutory body established under the Recovery of Debt and Bankruptcy Act 1993. Its purpose is to adjudicate cases and facilitate the recovery of loans from banks and financial institutions. In 2020, the Indian Government raised the minimum limit for filing cases under DRTs to 20 lakh rupees. The Presiding Officer, appointed by the Central Government, heads the Debt Recovery Tribunal DRT. Appeals against DRT orders can be made to the Debt Recovery Appellate Tribunal (DRAT), which a Chairman heads. Financial institutions and banks file loan recovery applications with the DRT having jurisdiction over the debtor’s residence or business location. During adjudication, the DRT possesses powers akin to a District Court. Additionally, the Debt Recovery Tribunal (DRT) has recovery officers responsible for executing the orders it issues.
Powers and Functions of DRT
- A Debt Recovery Tribunal DRT is empowered to enforce the provisions of the Recovery of Debt and Bankruptcy Act-1993 and the SARFAESI (Securitization and Reconstruction of Financial Assets and Enforcement of Security Interests) Act 2002.
- DRT gets the authority to entertain debt recovery-related applications from financial institutions and banks from section 17 of the Recovery of Debt and Bankruptcy Act-1993.
- While deciding the cases, the Debt Recovery Tribunal (DRT) acts as a District Court.
- It can pass orders for complete justice that are comprehensive and even go beyond the Civil Procedure Code (CPC).
- Section 18 of the Recovery of Debt and Bankruptcy Act-1993 imposes restrictions on all the Courts from adjudicating on debt recovery-related matters except the Supreme Court and High Courts.
- It means that relief against the orders of DRAT can only be given by the Supreme Court and High Courts.
- Supreme Court, in its judgment, has specified that the DRT and the DRAT have jurisdiction strictly confined to those cases that are mentioned in Section 17 of the Recovery of Debt and Bankruptcy Act-1993.
- Thus the Debt Recovery Tribunals (DRTs) cannot decide over the cases like property rights, succession issues, issuance of receipts, etc.
- Section 17A was inserted in the act by an amendment in 2000. It specifies the powers of the Chairperson of the DRAT. Its general powers include.
- Superintendence and control of Tribunals under his jurisdiction.
- Reviewing the ACRs (Annual Confidential Reports) from various Presiding Officers.
- Direct Tribunals to present the status of cases under both the RDB Act and the SARFAESI Act.
- Review the performance of Presiding Officers.
- Organise meetings with Presiding Officers.
- Recommend disciplinary action against Presiding Officers to Centre through his report in case of misconduct or incapacity.