RDDBFI Act- 1993

RDDBFI Act - 1993

The Debts Recovery Tribunals (DRTs) and Debts Recovery Appellate Tribunal (DRATs) were established under the Recovery of Debts Due to Banks and Financial Institutions Act (RDDBFI Act), 1993 with the specific objective of providing expeditious adjudication and recovery of debts due to Banks and Financial Institution. The DRTs are empowered to adjudicate claims of banks and FIs involving rupees ten lakhs and above.

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/ entity. After adjudication, the DRT issues order and Recovery Certificate, certifying the amount payable by the borrower to the bank or Financial Institution. This Recovery Certificate is thereafter executed by Recovery Officers attached to the DRT.

1 It provides for recovery of debts of Banks & FIs through quasi-judicial tribunals called Debt Recovery Tribunals It empowers Banks and FIs to recover secured debts directly without intervention of judicial process
2 Enforce action against the secured assets and the personal assets of Directors/ / Partners/ Proprietor/ Guarantors Enforce action against secured assets which are secured by way of underlying security in the nature of mortgage, charge, hypothecation, assignment, etc.
3 Recovery of  debt more than Rupees ten lakhs Recovery of debt more than one lakh rupees
4 Appeal against the order of DRT to be filed in Debt Recovery Appellate Tribunal Appeal against order under  SARFAESI Act can be challenged before the DRT