INSUBCONTINENT EXCLUSIVE:
Illustration: Ajay Mohanty4 min read Last Updated : Sep 21 2024 | 8:35 PM IST
The Union Finance Ministry has advised the Debt Recovery
Tribunals (DRTs) and banks to engage with borrowers outside the tribunals to reduce the pendency of cases, according to a senior finance
clogging DRTs, significantly contributing to the pendency
We have advised both banks and DRTs to engage with borrowers
For example, if a loan of Rs 30 lakh takes three to four years to recover, the time value of money becomes minimal
If a borrower shows interest in settling that amount, we can explore alternative dispute resolution mechanisms, such as Lok Adalats, where
These settlements still fall under the purview of DRTs, providing an official stamp of approval
of chairpersons of Debt Recovery Appellate Tribunals (DRATs) and presiding officers of DRTs in New Delhi on Saturday
The meeting was also attended by senior officers from public and private sector banks and the deputy chief executive officer (CEO) of the
We have advised all banks and DRTs to prioritise high-value cases of Rs 100 crore and above
official added.
Currently, 39 DRTs and five Debt Recovery Appellate Tribunals (DRATs) are functioning across the country
Each DRT and DRAT is headed by a presiding officer and a chairperson, respectively.
The official further stated that banks have been
advised to reconsider traditional recovery methods
other means, there is hardly any asset left with the borrowers
this ultimately adds to pendency, and the chances of recovery become minimal
they discover any new assets
government data presented in a parliamentary answer, as of January 24, 2024, the total number of cases pending for more than 180 days before
Out of these pending cases, 142,187 are Original Applications (OAs) and 42,889 are Securitisation Applications (SAs).
The parliamentary
reply also noted that the total number of cases pending before Debt Recovery Tribunals (DRTs) is 215,431, out of which 162,317 are Original
Applications (OAs) filed under Section 19 of the Recovery of Debts and Bankruptcy Act (RDB Act), 1993, and 53,114 are Securitisation
Applications (SAs) filed under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest
We have directed them to follow a summary procedure to resolve cases quickly, which should improve efficiency
Additionally, the usual housekeeping measures, such as capacity building and training, are ongoing, and the ministry is committed to
finance ministry official added.First Published: Sep 21 2024 | 8:30 PMIST
