Criminal Trident Pack: IPC, CrPC and IEA by Sr. Adv. G.S Shukla and Adv. Raghav Arora
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Prakash Yedhula (Lawyer)     22 March 2009

Frequently Asked Questions on Debts Recovery Tribunals

 What are the Debts Recovery Tribunals?


 

The Debts Recovery Tribunals have been established by the Government of India under an Act of Parliament (Act 51 of 1993) for expeditious adjudication and recovery of debts due to banks and financial institutions.

 

Who can file cases before the DRTs?

 

Where a bank or financial institution has to recover any debt from any person, it makes an application called Original Application (OA) to the Tribunal against such person.

 

What are the functions and procedure of the DRTs?

 

The DRTs function under the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and as per the Debts Recovery Tribunal (Procedure) Rules, 1993.

 

What is the pecuniary jurisdiction of the DRTs?

 

The provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 shall not apply where the amount of debt due to bank or financial institution or to a consortium of banks or financial institutions is less than ten lakhs rupees or such other amount, being not less than one lakh rupees, as the Central Government may, by notification, specify.

 

What is the fee for filing an Original Application (OA) before the Tribunal?

 

The fee payable as per Rule 7 of the Debts Recovery Tribunal (Procedure) Rules, 1993 is Rs.12,000/- where an amount of debt due is Rs.10.00 lakhs, Rs.12,000 plus Rs.1000 for every one lakh of debt due or part thereof in excess of Rs.10.00 lakhs subject to a maximum of Rs.1,50,000/- where an amount of debt due is above Rs.10.00 lakhs.

 

What is the fee for Review Application?

 

The fee for Review Application is fifty per cent of the fee paid for the OA.

 

What is the fee for Interlocutory Application?

 

The fee for filing Interlocutory Application (IA) is Rs.250/-.

 

What is the fee for Vakalatnama?

 

The fee for filing Vakalatnama is Rs.5/-.

 

What is the fee for an appeal against the order of the Recovery Officer?

 

Rs.12,000/- if the amount appealed against is less than Rs.10 lakhs.

 

Rs.20,000/- if the amount appealed against is Rs.10 to 30 lakhs.

 

Rs.30,000/- if the amount appealed against is more than 30 lakhs.

 

What is the fee for perusal of documents?

 

Rs.100/- per case.

 

What is the fee payable for certified copies of documents?

 

Rs.5 per page.

 

What is the place of filing of an Application?

 

The application shall be filed by the Applicant with the Registrar within whose jurisdiction the Applicant is functioning as a bank or financial institution as the case may be, for the time being.

 

What are the contents of the Application?

 

Every Application filed under Rule 4 of the DRT (Procedure) Rules, 1993, shall set forth concisely under distinct heads, the grounds for such application and such grounds shall be numbered consecutively and shall be typed in double space on one side of the paper.

 

Under SARFEASI Act, 2002 for actions taken by authorized officer, appeal/application lies with whom?.

 

For actions taken under sub-section (4) of Section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 by the authorised officer, an application shall lies to the Debts Recovery Tribunal - I, Chennai under section 17(1) of that Act.


Learning

 10 Replies

Y V Vishweshwar Rao (Advocate )     22 March 2009

 


Sir I have a doubt--------  whether the DRT can entetain   application  for impleading the thrid parties-  who are claiming rights on the Mortgaged Properties as Purchaser - The  purchase is under  a Sale agreemnet   and obtained a Decree for specific performance  against the Mortgagor .


Bank filed  AO before the DRT  and it is pending and in the Reply of Mortgagor the fact of Sale agreement  and Decree agaisnt the Mortgagor are pleaded  and came to the  knowledge of the  the Bank .


The   said  purchasers can be impleaded on the application of the Bank  and all the claims agaisnt the Mortgaged Proeprty can be   adjudicated in the DRT .


I request  your valuable  opinion on this point .


.

SANJAY DIXIT (Advocate)     22 March 2009

Dear yedul, Thanks for the informative & useful FAQ.

N.K.Assumi (Advocate)     23 March 2009

Prakashji, Thank you for contributing your hard work for all of us. Very Informative.

Shashikant V. Patil (Lawyer)     23 March 2009

Good information given by Prakashji.

RAKHI BUDHIRAJA ADVOCATE (LAWYER AT BUDHIRAJA & ASSOCIATES SUPREME COURT OF INDIA)     23 March 2009

Thanx Mr. Prakash. U have supplied very useful information for all of the members of lawyersclub.

M. PIRAVI PERUMAL (Advocate & Consumer Rights)     24 March 2009

Thanks a lot Prakashji.

Mahesh (Asst. General Manager (Law))     24 March 2009

A very useful information. Thanks Mr. Prakash.

Anil Kr Garg (Business)     20 July 2011

Dear Mr. prakash, thanks a lot for extremely useful information provided. I have a few doubts and request your views on the same pls

1) When a borrower has paid more than 80% of the amount demanded under notice u/s 13(2) and 13(4) of SARFAESI ACt, that is, after commencement of proceedings but before actual physical possession while the proceedings were pending with Tehsildar for actual possession, will he be granted benefit of 31(j) which says that SARFAESI will not be applicable if outstanding is less than 80%?

2)Once loan account is reported to be REGULAR due to full payment of all overdues, can borrower demand SARFAESI proceedings to be set aside?

3) In a case where title deeds of a property are not actually given to a bank, and the bank has never demanded the same on record. In case of default after a few years of paying EMIs, will the bank be able to treat this loan (HOME LOAN) as secured? Will the bank able to initiate proceedings under SARFAESI since the bank does not have property documents and hence, no mortgage by depositing title deeds was completed? If no, will the bank able to initiate proceedings with DRT as unsecured loan?

4) If bank is recalling loan due to overdue EMIs, can it also demand PREPAYMENT CHARGES? The agreement provides for Prepayment Charges only when borrower is offering prepayment.

5) RBI's directives on floating interest rates stipulate that banks should not offer floating rate loan products with reference to their internal benchmark lending rate, but should refer the same to an external or market rate. Also, that loan agreements should have a clause stating that interest will be increased or reduced in accordance with increase or reduction in interest rates by RBI from time to time. In practice, banks do not comply with such directives and refer to their own PLRs which they do not revise downwards in accordance with RBI rate revisions, with the result the spread over RBI's repo rate which was once 5% at the time of taking loan, has gone to 9.25%!. What is the remedy with a borrower in such case?

Thank you in advance.

Anil Kr Garg (Business)     20 July 2011

Dear Mr. prakash, thanks a lot for extremely useful information provided. I have a few doubts and request your views on the same pls

1) When a borrower has paid more than 80% of the amount demanded under notice u/s 13(2) and 13(4) of SARFAESI ACt, that is, after commencement of proceedings but before actual physical possession while the proceedings were pending with Tehsildar for actual possession, will he be granted benefit of 31(j) which says that SARFAESI will not be applicable if outstanding is less than 80%?

2)Once loan account is reported to be REGULAR due to full payment of all overdues, can borrower demand SARFAESI proceedings to be set aside?

3) In a case where title deeds of a property are not actually given to a bank, and the bank has never demanded the same on record. In case of default after a few years of paying EMIs, will the bank be able to treat this loan (HOME LOAN) as secured? Will the bank able to initiate proceedings under SARFAESI since the bank does not have property documents and hence, no mortgage by depositing title deeds was completed? If no, will the bank able to initiate proceedings with DRT as unsecured loan?

4) If bank is recalling loan due to overdue EMIs, can it also demand PREPAYMENT CHARGES? The agreement provides for Prepayment Charges only when borrower is offering prepayment.

5) RBI's directives on floating interest rates stipulate that banks should not offer floating rate loan products with reference to their internal benchmark lending rate, but should refer the same to an external or market rate. Also, that loan agreements should have a clause stating that interest will be increased or reduced in accordance with increase or reduction in interest rates by RBI from time to time. In practice, banks do not comply with such directives and refer to their own PLRs which they do not revise downwards in accordance with RBI rate revisions, with the result the spread over RBI's repo rate which was once 5% at the time of taking loan, has gone to 9.25%!. What is the remedy with a borrower in such case?

Thank you in advance.

Satya Narayana Palukuru (Advocates & Mediators.)     20 July 2011

Thanks Prakashji


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