| The Reserve Bank of India, in its report on the trend and progress of banking in India, said as on June 30, 2004, DRTs managed to recover only Rs 7,845 crore of the Rs 25,358 crore stuck in 27,956 cases adjudicated by them. A total of 63,600 cases were filed with DRTs to recover a whopping Rs 91,926 crore. |
| Sarfaesi, or Securitisation and Reconstruction of Financial Asset and Enforcement of Security Interest Act, has also failed to help banks recover their dues. Of the 61,263 notices issued by public sector banks involving an outstanding amount of Rs 19,744 crore, banks have managed to recover only Rs 1,748 crore from 24,092 defaulters. |
| B Gopalakrishnan, senior vice-president, law, UTI Bank, said the central government has to consider restructuring of the debt recovery tribunals by making it a multi member bench. |
| They would have to ensure that DRTs are manned by professionals who are well versed with banking modalities. |
| Authorities would have to bring the DRT's at par with the income tax tribunal as it will improve and expedite the recovery process, he added. |
| The RBI had recently issued guidelines to commercial banks and financial institutions advising them to make increasing use of Lok Adalats to settle disputes between banks and small borrowers. |
| The number of cases filed by commercial banks with Lok Adalats stood at 485,046 involving an amount of Rs 2,433 crore, said the report. |
| The number of cases decided was 205,032 involving an amount of Rs 974 crore and the recoveries effected in 159,316 cases stood at Rs 328 crore as on March 31, 2004, it added. |
| The legal department head of a leading public sector bank said the RBI would have to empower Lok Adalats with more statutory power. |
| Currently, borrowers have the power to challenge the judgement in a higher court this culminates into a long drawn legal battle delaying the recovery process, he added. |
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