Another crucial wing of litigation involves legal battles with, one of the strongest lobbies in any civilized system i.e. Banks. The Banks have now a days become extremely aggressive in taking action against defaulters. Banks, more often than not, initiate action against the defaulters under the Recovery of Debts and Bankruptcy Act, 1993 and Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 against defaulters. The provisions of these enactments have a direct and permanent effect on the right to property of an individual. Banks have been conferred with the right to dispossess, alienate, attach, assign, use any secured property of a borrower, mortgagor, guarantor.
On the other hand, in many a cases, habitual defaulters use the lacunaes in law, to defeat the action of the bank, thereby duping the banks and in-turn public money entrusted with the bank. Therefore, an in-depth understanding of the aforesaid two enactments as well as Banking Regulation Act 1949, Reserve Bank of India Act, 1934, Protection of Interest of Depositors Act etc. is required and utmost essential while navigating disputes involving banks and borrowers.
Filing original applications and SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) petitions before the Debt Recovery Tribunal (DRT), as well as appealing decisions before the Debt Recovery Appellate Tribunal (DRAT), constitutes crucial steps in the recovery process. Each of these stages involves complex legal procedures that demand precision and a thorough grasp of the applicable laws. The execution of judgments rendered by these tribunals is another significant phase, where meticulous attention to detail is critical to ensure that recovery processes are conducted efficiently and effectively.
Moreover, since these cases often involve significant sums of money—ranging from lakhs to crores of rupees—advocates must approach each matter with diligence and an unwavering focus on details. This is essential not only for the successful recovery of debts but also for maintaining the financial integrity of the involved institutions. In this context, experience plays an indispensable role, as seasoned legal practitioners bring valuable insights and strategies that can make a substantial difference in the outcomes of these cases.