DRT Lawyer Kolkata Bank Recovery

The DRT was established under the Recovery of Debts and Bankruptcy Act, 1993 (RDB Act), to provide a fast-track forum for recovery of debts by banks and financial institutions. DRT-I, Kolkata, located at the Jeevan Sudha Building, has jurisdiction over cases from West Bengal and the Andaman & Nicobar Islands. The tribunal is presided over by a Presiding Officer (a senior judicial officer or retired High Court judge). The key procedural stages in a DRT Original Application (OA) are: (1) The bank files an OA under Section 19 of the RDB Act, claiming the outstanding debt with interest. (2) The DRT issues summons to the defendants (borrower, guarantor, mortgagor). (3) The defendants file a written statement within 30 days (extendable by the tribunal). (4) The bank may file a rejoinder. (5) The tribunal frames issues based on the pleadings. (6) The bank presents evidence (usually through an affidavit of evidence of a bank officer, who is cross-examined by the defendant). (7) The defendant presents evidence. (8) Arguments and judgment — the DRT either allows the OA and issues a recovery certificate, or dismisses it. The entire process is designed to be completed within 180 days, though in practice it takes 1-3 years. Advocate Panchanand Shaw represents defendants at every stage of the OA, ensuring that all available defences are raised and that the bank's evidence is thoroughly tested through cross-examination.

When a bank invokes the SARFAESI Act and takes or threatens to take possession of secured assets, the borrower's remedy is to file a Securitisation Application under Section 17 before the DRT. The SA must be filed within 45 days of the action challenged (e.g., the Section 13(4) possession notice). The DRT examines whether the bank followed the procedure under Sections 13(2)-(4) — whether the notice was properly served, whether the 60-day period was observed, whether the borrower's objection under Section 13(3A) was properly considered, and whether the classification of the account as NPA was correct. Important: an SA can be filed without any mandatory pre-deposit — the amendment that introduced a 25% pre-deposit requirement in DRT appeals (Section 18) does not apply to the SA itself. If the DRT finds in favour of the borrower, it can declare the bank's SARFAESI action invalid and restore possession to the borrower. Advocate Panchanand Shaw has filed numerous SAs, successfully challenging SARFAESI possession notices on grounds of procedural non-compliance, incorrect NPA classification, and violation of the RBI's guidelines.

A defendant in a DRT OA has several potential defences. (a) Limitation: The OA must be filed within three years of the date of default or the last acknowledgment of debt. If the bank's claim is time-barred, the DRT must dismiss it. (b) Quantum of debt: The bank's calculation of the outstanding amount — particularly interest, penal interest, and charges — may be incorrect or contrary to RBI guidelines. A detailed forensic audit of the loan statements is often essential. (c) The debt is not due: The borrower may have paid the outstanding or the loan may have been settled through an OTS. (d) Procedural defences: The OA was not properly verified, mandatory pre-filing requirements were not met, or the bank did not exhaust remedies against the principal security before proceeding against the personal guarantee (though this last defence is limited). (e) The guarantee is not enforceable: The guarantee was obtained by misrepresentation, the terms of the principal contract were varied without the guarantor's consent, or the guarantee has been revoked. (f) Counter-claim: The borrower may have a claim against the bank (e.g., damages for wrongful dishonour, breach of banking obligation) that can be set off against the bank's claim. Advocate Panchanand Shaw explores all available defences and presents them in a coherent, evidence-supported written statement.

If the DRT allows the OA and issues a recovery certificate (RC), the bank can execute it through the Recovery Officer (an officer of the DRT) under the Second Schedule to the Income Tax Act. The Recovery Officer can: (a) attach and sell movable and immovable property of the certificate debtor; (b) arrest and detain the certificate debtor in civil prison (as a last resort, and only if the debtor has the means to pay but is wilfully avoiding payment); (c) appoint a receiver to manage the debtor's property; and (d) prohibit the debtor from transferring or charging any property. The execution process can be swift — often faster than the OA adjudication itself. Once a recovery certificate is issued, the borrower's options are limited: file an appeal before the DRAT (which requires a pre-deposit of 25% of the debt, extendable to 50% at the DRAT's discretion), negotiate an OTS with the bank (even after judgment, banks often prefer a negotiated settlement over protracted execution), or file a writ petition before the Calcutta High Court challenging the DRT's order on grounds of jurisdictional error or violation of natural justice. Advocate Panchanand Shaw advises clients at the execution stage, pursuing appeals, negotiating settlements, and — where necessary — challenging the RC through writ petitions.