The Debt Recovery Tribunal (DRT) in India performs several important functions related to the recovery of debts due to banks and financial institutions.
Functions of the DRT
- Resolve Debt Disputes: The DRT helps banks and financial institutions recover outstanding debts from borrowers. It listens to both sides and makes decisions about how much debt is owed and how it should be repaid.
- Enforce Security: The DRT has the power to enforce the security given by the borrower to the bank or financial institution. This means it can take control of and sell the assets pledged as security to recover the debt.
- Sell Borrower’s Assets: If the borrower doesn’t repay the debt, the DRT can order the attachment and sale of the borrower’s assets to get the money owed. It can appoint someone to manage the sale of these assets and use the proceeds to repay the debt.
- Protect Interests: During the legal process, the DRT can take temporary actions to protect the interests of the banks or financial institutions. It can freeze assets or prevent the borrower from selling or transferring property until the debt issue is resolved.
- Gather Evidence: The DRT can call witnesses and ask them questions under oath. It can also request the production of documents or records relevant to the case. This helps in collecting information and evidence needed to make fair decisions.
- Issue Recovery Certificates: If the borrower doesn’t comply with the DRT’s order to repay the debt, the DRT can issue recovery certificates stating the amount of money owed. These certificates allow the banks and financial institutions to take further legal steps to recover the debt.
- Handle Contempt: If the borrower deliberately disobeys the DRT’s orders, the DRT can initiate contempt proceedings against them. This serves as a warning against violating the DRT’s decisions.
