Debt Recovery Tribunal (DRT) is a specialized tribunal established to adjudicate and recover debts due to banks and financial institutions. It handles loan recovery cases and enforcement of security interests under applicable banking and recovery laws.
The DRT Delhi held that prepayment charges cannot be levied when a bank recalls a loan and the borrower has not voluntarily offered early repayment. The recovery claim was reduced after excluding such charges.
The tribunal relied on Supreme Court precedent to hold that a second proceeding cannot be filed when an earlier challenge has been withdrawn without permission to pursue another remedy.
The Tribunal ruled that a sale made after creation of an equitable mortgage cannot defeat the bank’s security interest, leading to dismissal of the borrower’s challenge.
The DRT Karnataka allowed recovery of ₹99.81 lakh after the borrower failed to appear and the bank’s documents proved the loan, hypothecation, and default. The tribunal granted recovery with 12% simple interest.
The Tribunal allowed the bank’s recovery application after borrowers failed to appear or dispute the claim, resulting in an ex-parte decision. It permitted recovery of ₹37.80 lakh with interest and costs and allowed sale of hypothecated assets if payment is not made.
The Tribunal allowed recovery of ₹10.74 lakh after the borrower defaulted on a car loan and failed to appear in the proceedings. The bank’s documentary evidence remained unrebutted.
