How many types of application are there in DRT?
There are 4 types of applications that can be filed in a Debts Recovery Tribunal (DRT):
- Original Application (OA): This is the most common type of application and is filed by a bank or financial institution to recover a debt from a borrower. The OA must be filed within three years of the debt becoming due.
- Securitisation Application (SA): This type of application is filed by a bank or financial institution to recover a debt that has been securitized. Securitization is the process of converting illiquid assets into marketable securities.
- Interlocutory Application (IA): This type of application is filed for any interim relief during the pendency of an OA or SA. For example, an IA can be filed to seek attachment of the borrower’s property or to restrain the borrower from disposing of his assets.
- Miscellaneous Application (MA): This type of application is filed for any other purpose not covered by the OA, SA, or IA. For example, an MA can be filed to seek clarification of an order passed by the DRT or to challenge the jurisdiction of the DRT.
The procedure for filing an application in a DRT is governed by the Debts Recovery Tribunal (Procedure) Rules, 1993. The application must be filed in Form 1 along with the requisite fees. The application must be accompanied by a copy of the debt recovery agreement, if any, and all other relevant documents.
The DRT will then issue a notice to the borrower and other respondents. The borrower and other respondents will have an opportunity to file their objections to the application. The DRT will then hear the arguments of both parties and pass an order.
The order of the DRT can be appealed to the Debts Recovery Appellate Tribunal (DRAT). The DRAT is a two-member bench, consisting of a retired judge of the High Court and a financial expert. The DRAT can either confirm, modify, or set aside the order of the DRT.
The time period for filing an application in a DRT depends on the type of application. The OA must be filed within three years of the debt becoming due. The SA must be filed within one year of the securitization of the debt. The IA and MA can be filed at any time during the pendency of the OA or SA.
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