Q. Consider the following statements regarding Debt Recovery Tribunals
1.They are established under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act
2.An application for recovery of debt can be made to the DRTs for all debts valued at more than 20 lakhs.
Which of the statements given above is/are correct?
Answer: B
Notes:
About Debt Recovery Tribunals (DRT):
- Debt Recovery Tribunals have been established following the passing of the Recovery of Debts due to Banks and Financial Institutions Act (RDDBFI),1993.
- The primary goal and function of DRT is the recovery of loaned money from borrowers which is owed to banks and financial institutions from customers.
- This Tribunal is also the second court of appeal in respect of cases filed under The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest(SARFAESI) Act,2002.
Jurisdiction:
- An application for recovery of debt can be made to the DRTs for all debts valued at more than 20 lakhs.For lesser amounts,the banks and financial institutions can approach Civil Courts.
- No court in the country other than the Supreme Court(SC) and the High Court(HC) and that too only under articles 226 and 227 of the Constitution have jurisdiction against a judgment of DRAT.
