A bank or financial institution may submit any application to DRT under Section 17 of the RDDBFI Act in order to recover loans on behalf of such bank or financial institution. Any appeals against any orders made by a DRT under the Act must be heard by the DRAT, which is the Appellate Tribunal.
DRT is authorized to consider any application from banks and financial institutions pursuant to Section 17 of the RDDBFI Act in order to recover loans for such banks and financial institutions. DRAT, which is the Appellate Tribunal, has the authority to hear appeals against any decisions made by a DRT pursuant to the Act.
Only the situations listed in Section 17 of the Act fall under its stringent control. Other courts are no longer permitted to investigate debt-related cases under Section 18 of the Act, with the exception of the Supreme Court and High Court, whose authority stems from Articles 226 and 227 of the Constitution.
On the contrary, the Supreme Court held that DRT and DRAT could not determine concerns like property succession rights, the issuance of receipts, etc. Only the situations listed in Section 17 of the Act fall under its meticulous command.
The addition of sub-sections 6 to 11 to Section 19 of the Act does not remove the jurisdiction of Civil Court2, making it impossible to transfer a separate lawsuit brought by the borrower in Civil Court that is intimately linked to a bank claim before the Debt Recovery Tribunal. However, a borrower’s lawsuit seeking an injunction before a civil court will not be maintainable while a recovery application is pending before the tribunal because, in most cases, only cases of fraud or the existence of other vitiating factors can result in an injunction blocking the enforcement of an order made by a tribunal with the authority to make such orders being granted.
The jurisdiction of DRTs is allotted as per the wards and areas by Ministry of Finance. Cases involving the city areas of Ward ‘A’ (including Colaba and Nariman Point) and Ward ‘H’ as determined by the Brihanmumbai Municipal Corporation (BMC) as well as any other area of Mumbai not covered by Mumbai Debts Recovery Tribunal No. 3 and the State of Goa are handled by DRT I. Wards ‘B’ to ‘G’, ‘K’ to ‘P’, ‘R’ to ‘T’, and ‘B’ to ‘G’ are the city wards that DRT II handles cases for. As opposed to this, DRT III is in charge of matters involving the Maharashtra State, Thane District, and Palghar District