The full form of DRT is Debt Recovery Tribunals. It refers to those tribunals that were specifically established to facilitate speedy recovery of debts which are debt to financial institutions and banks. In simple terms, the primary purpose of DRT or Debt Recovery Tribunals is to recover loaned money from customers.
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History of DRT
- Earlier, financial institutions and banks faced much difficulty in recovering loans provided to individuals and organizations.
- Although cases of Non-Performing Assets (NPAs) and bad loans were presided over by civil courts, it took several years to deliver justice.
- Accordingly, the RDDBFI, or the Recovery of Debts due to the Banks and Financial Institutions Bill was enacted in India on 27 August 1993.
Features of DRT
Here are a few features of the Debt Recovery Tribunals:
- The central government of India appoints a tribunal which consists of only a single person. This individual also acts as the Presiding Officer.
- The Presiding Officer of DRT must fulfill the eligibility criteria to become a District Judge in order to become eligible.
- The Presiding Officer has a term of five years and is also suitable for reappointment post-termination.
- The central government of India can provide the Presiding Officer with recovery officers who seem fit for the role.
Who is Eligible for DRT?
DRT only deals with the recovery of loans where either party is a bank or financial institution.
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What is the Limit of DRT Amount?
DRT or Debt Recovery Tribunals are empowered to preside over claims which are equal to or greater than ten lakh rupees. However, this limit was later raised to twenty lakh rupees in the year 2018.
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