Extract From DRT Solutions Weekly Mail
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Transcript of Extract From DRT Solutions Weekly Mail
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7/30/2019 Extract From DRT Solutions Weekly Mail
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Observations and Comments
On account of legal ignorance, the borrowers and guarantors are highly
scared of the physical possession orders for which are obtained by thebanks from the Magistrate u/s 14. Our observations and comments are as
under:-
(a) After possession notice u/s 13(4), the borrower is entitled to file
application u/s 17 before the DRT within 45 days of receipt and or
publication of the said notice in two news papers.
(b) Hence we have been advising our clients to file caveat with the
Magistrate so that opportunity is given to the borrower to
participate in the proceedings.
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(c) Further we have been advising our clients, to approach to DRT,
the moment they come to know that the bank has approached the
Magistrate.
(d) The Magistrate is bound to take action on the said caveat as wellas to extend opportunity for hearing.
(e) If there are wrong doings by the bank upto the stage of 13(4),the Magistrate is bound to refuse to act u/s 14.
(f) In case the Magistrate orders for physical possession, his order
is appealable u/s 17 before the DRT.
(g) Keeping all the above aspects and implications in view, we cove
all the related aspects when we prepare the objections and
representation against the notice u/s 13(2) including the claim for
loss and damages. Such pleadings become useful and handy while
dealing with the Magistrate as well as the DRT.
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(h) The gist of the approach is that on account of huge loss and
damages due to the wrong doings of the bank, there is No Debt
Due, hence there is no cause for recovery. Until and unless this
issue is settled by the DRT, no physical possession can be taken.
This will be done only after final order against the SA u/s 17. Asper the Supreme Court in the matter of Mardia Chemicals, the said
SA is in lieu of a suit. The adjudication of a suit takes time of
several years. Since the higher authorities in the bank are also
impleaded in the said suit, lot of pressure is created and ultimately,
the bank officers have no option but to settle as per the terms
desired by the borrower.
(i) In above dealings, one should study and keep in view all the
related case laws. Even there may be occasions to file Review and
Appeal.
Our Comments:-
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The implications are huge.
Massive comments are needed. It will only result in numerous
legal complications to the bank officials, the Magistrates, Pos
of the DRTs, High Courts and the Supreme Court particularlywhen loss and damages or counter-claims have been raised by
the borrowers. On the other hand small borrowers will greatly
suffer as they do not have adequate knowledge and
resources to he desired legal fight. Ultimately the banks will
suffer as the amount recovered will be small but the disrepute
will be massive.