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APPEAL TO DEBT RECOVERY
TRIBUNAL (DRT)
Any person aggrieved by any measure taken by secured creditor or
his authorised officer may file an appeal to Debts Recovery Tribunal,
within 45 days from date on which such measure was taken. i.e. action
of taking possession of asset, takeover of management of business
of borrower, appointing person to manage secured asset etc. is taken
by the creditor.
When a borrower files an appeal, the appeal cannot be entertained
unless; the borrower deposits 75% of the amount claimed in the notice
by secured creditor. The DRT can waive or reduce the amount required
to be deposited. The amount is not required to be deposited at the
time of filing appeal, but appeal will not be heard till the amount
is deposited. The borrower while filing the appeal should also file
an application requesting the Debt Recovery Tribunal to admit the
appeal without deposit of any amount. It the DRT orders partial
deposit of the amount and the same is not deposited, appeal can
be dismissed.
The 75% deposit is only required if the appeal is filed by the
borrower. If some other aggrieved person (e.g. guarantor, shareholder)
files it the deposit is not required.
DEBT RECOVERY APPELATE TRIBUNAL
If a person is aggrieved by the order of the DRT, it can file an
appeal to the Appellate Tribunal within 30 days from date of receipt
of the DRT order.
If the DRT or Appellate Tribunal holds that possession of assets
by the secured creditor was wrongful and directs the secured creditor
to return asset to concerned borrower, the borrower shall be entitled
to compensation and costs as may be determined by DRT or Appellate
tribunal.
The Tribunal can also direct return of asset, if the secured creditor
had already sold or transferred the asset to a third party.
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