Summary suit for recovery of npa dues of banks
Punit Gupta
(Querist) 23 March 2026
This query is : Resolved
Dear All,
Please confirm whether Summary Suit under Order 37 (XXXVII) of CPC can be brought for recovery of Dues in NPA accounts of Banks?
What makes it different than a normal Civil Recovery suit??
kavksatyanarayana
(Expert) 23 March 2026
Sending demand notices, restructuring loans, utilising One Time Settlements (OTS), invoking the SARFAESI Act for asset seizure, filing suits in Debt Recovery Tribunals (DRT), and conducting Lok Adalats.
Airtel
Airtel
+4
Dr. J C Vashista
(Expert) 25 March 2026
Yes, a suit under Order XXXVII CPC can be instituted for a NPA loan.
Advocate Bhartesh goyal
(Expert) 25 March 2026
Bank can file summary suit under order 37 CPC for the recovery of NPA if claim is based on written contract,promissory note or liquidated demand.Generally Banks utilize Debt Recovery Tribunal (DRT ) or SARFAESI Act proceedings for NPA.
T. Kalaiselvan, Advocate
(Expert) 26 March 2026
A summary suit is maintainable only when the bank’s claim is based on a “written contract” or specified instruments, such as Loan agreements (duly executed) or on the basis of Demand promissory notes (DPN) or Bills of exchange / hundis or Written guarantees or on the basis of an Acknowledgment of debt in writing.
So, if the NPA arises from clear written loan documents, banks often use Order 37 to speed up recovery. However, if the claim involves complex facts or oral agreements or Disputed accounts or
Fraud allegations then summary suit is not appropriate, and a regular civil suit must be filed.
The main features of summary suit is that this is a fast-track recovery mechanism. In a summary suit the Defendant cannot defend automatically, he must first file an appearance within 10 days and then seek “leave to defend” from court. Leave is granted only if a substantial defence is shown. If no leave is granted then the Court can pass decree immediately resulting into faster disposal and there are less scope for delaying tactics.
In a normal Civil Recovery Suit , it follows a full trial process. The main features is that the Defendant has automatic right to defend, Written statement, evidence, cross-examination and full trial required, resulting into time-consuming (years) more procedural stages.
Punit Gupta
(Querist) 30 March 2026
Thank you very much for the enlightenment.
Regards
