DRT is empowered to adjudicate matters relating to recovery of NPA Loans by the Banks.
The matters where DRT is empowered for adjudication including the appeals under SARFAESI Act, the powers of Civil Courts are barred.
Prior to 1990s, banks were facing great hardship in loan recovery segment.
Due to procedural delays, the loan recovery cases filed by the Banks took a very long time to reach conclusion.
The Government of India, therefore, in 1993, established the DRTs (Debt Recovery Tribunals) to promptly dispose off the recovery of loan in NPA accounts.
The appeals against DRT orders lie in DRAT (Debt Recovery Appellate Tribunal).
The Debts Recovery Tribunals (DRTs) and Debts Recovery Appellate Tribunals (DRATs) mechanism was set up under The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (RDDBFI Act) with the objective to provide expeditious adjudication and recovery of debts due to Banks and Financial Institutions.
The RDDBFI Act provides for speedy redressal to lenders and borrowers through filing of Original Applications (OAs) in Debts Recovery Tribunals (DRTs) and appeals in Debts Recovery Appellate Tribunals (DRATs). We can understand the OA as a recovery suit filed in DRT by the Bank against the borrowers and guarantors.
The DRTs replaced the functioning of Civil Courts in the matters of recovery of NPA Loans as coming within their pecuniary powers, as also to hear the appeals under SARFAESI Act.
The provisions of CPC does not apply on DRT working and the DRTs prepare their own rules and procedures keeping in view the provisions ofIndian Constitution and the rules of natural justice.
Normally, the advocates practising in DRT have specialised working knowledge of Banking laws, practices and the accounting procedures and practices.
As on date (2nd July, 2021) there are 39 Debts Recovery Tribunals (DRTs) and 5 Debts Recovery Appellate Tribunals (DRATs) are functioning in India.
Each DRT is headed by a Presiding Officer and the DRAT is headed by a Chairperson respectively.
The post of Presiding Officer of DRT is equivalent to a District Judge and the post of Chairperson of DRAT is equivalent to the Judge of High Court.
JURISDICTION OF DRAT's and DRTs:
There are 39 DRTs and 5 DRATs, all of which are single Member Tribunals. The jurisdiction of DRATs and list of DRTs is as below: