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POWERS OF DRT
DEBT RECOVERY TRIBUNAL

The Debt Recovery Tribunals have been constituted the Government of India to resolve the financial disputes  between the borrowers and the Banks & Institutional Lenders and to help in recovery of Loans in NPA Accounts.          

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It was observed during 1981 that in a significant portion of the funds being blocked in the economy as the Banks and Financial Institutions were experiencing huge difficulty in recovering their Loans granted to individuals and businesses. The existing procedure for recovery of debts due to the banks and financial institutions has blocked a significant portion of their funds in unproductive assets, the value of which deteriorates with the passage of time

To remove this difficulty the Committee on the Financial System has considered the setting up of the Special Tribunals with special powers for adjudication of such matters and speedy recovery as critical to the successful implementation of the financial sector reforms.

Accordingly, in 1981 a Committee had studied the legal faced by banks and financial institutions and suggested curative measures including changes in law and setting up of Special Tribunals for recovery of dues of the banks and financial institutions by following a summary procedure.

The Committee on the Financial System headed by Shri M. Narasimham has considered the setting up of the Special Tribunals with special powers for adjudication of such matters and speedy recovery as critical to the successful implementation of the financial sector reforms. An urgent need was, therefore, felt to work out a suitable mechanism through which the dues to the banks and financial institutions could be realized without delay.

Keeping in view the recommendations of the above Committees, the Recovery of Debts due to Bank and Financial Institutions Bill, 1993 was introduced in the Parliament.

The Bill seeks to provide for the establishment of Tribunal and Appellate Tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions. Notes on clauses explain in detail the provisions of the Bill. ACT 51 OF 1993 The Recovery of Debts Due to Banks and Financial Institutions Bill having been passed by both the Houses of Parliament received the assent of the President on 27th August 1993. It came on the Statute Book as THE RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT, 1993 (51 of 1993), which was amended from time to time.

LIST OF AMENDING ACTS

1. The Recovery of Debts Due to Banks and Financial Institutions (Amendment) Act, 1995 (28 of 1995).

2. The Recovery of Debts Due to Banks and Financial Institutions (Amendment) Act, 2000 (1 of 2000)



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