We represents our clients before DRT and DRAT (Debt Recovery Tribunal and Debt Recovery Appellate Tribunal)
Debt recovery tribunals (DRTs) & SARFAESI ACT Proceedings:
DRT and DRAT have been established by the Central Government. The Central Government decides the jurisdiction and also appoints one member as presiding officer, who should be at least a district Judge. DRT – other important aspects:
1. Representation before Baking Ombudsman:
On occasion of any irregularity or deficiency of services on part of Bank we represent our clients before Banking Ombudsman. The Banking Ombudsman is a senior official appointed by the Reserve Bank of India to redress customer complaints against deficiency in certain banking services. All Scheduled Commercial Banks, Regional Rural Banks and Scheduled Primary Co-operative Banks are covered under the Scheme. Some of the deficiency in banking services including internet banking, covered under the Banking Ombudsman Scheme are: – deficiency in customer service like non-acceptance, without sufficient cause, of small denomination notes tendered for any purpose, and for charging of commission in respect thereof, delayed or non- payment of inward remittance, delay in issuance of drafts, non-adherence to prescribed working hours, refusal to open deposit accounts without any valid reason for refusal, levying of charges without adequate prior notice to the customer, forced closure of deposit accounts without due notice or without sufficient reason, refusal to close or delay in closing the accounts etc. non-adherence to the fair practices code as adopted by the bank or non-adherence to the provisions of the Code of Bank’s Commitments to Customers issued by Banking Codes and Standards Board of India and as adopted by the bank, non-observance of Reserve Bank guidelines on engagement of recovery agents by banks; and any other matter relating to the violation of the directives issued by the Reserve Bank in relation to banking or other services.
2. Insolvency and Bankruptcy Code 2016:
An Act to consolidate and amend the laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximization of value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders including alteration in the order of priority of payment of Government dues and to establish an Insolvency and Bankruptcy Board of India, and for matters connected.
3. Insolvency:
Insolvency is when an individual or organization is unable to meet its outstanding financial debt towards its lender as it become due. Insolvency can be resolved by way of changing the repayment plan of the loans or writing off a part thereof. If it cannot be resolved, then a legal action may lie against the insolvent and its assets will be sold to pay off the outstanding debts. Generally, an official assignee/liquidator appointed by the Government of India, realizes the assets and allocates it among the creditors of the insolvent.
4. Bankruptcy:
Bankruptcy is a concept slightly different from insolvency, which is rather amicable. A bankruptcy is when a person voluntary declares himself as an insolvent and goes to the court. On declaring him as ‘bankrupt’, the court is responsible to liquidate the personal property of the insolvent and hand it out to its creditors. It provides a fresh lease of life to the insolvent.
5. Insolvency professional:
Section 2(19) of the Insolvency and Bankruptcy Code, 2016 (‘Code’ for short) defines the expression ‘insolvency professional’ as a person enrolled under section 206 with an insolvency professional agency as its member and registered with the Board as an insolvency professional under section 207. The insolvency professional may act as:
a. Interim resolution professional
b. Resolution professional
c. Liquidator
d. Bankruptcy trustee
6. LIQUIDATION OR WINDINGUP OF A COMPANY:
The Liquidation or winding up a company is a process through which life of company and it’s all affairs are wound up and its property administered for benefits of its creditors and members.
An administrator, who is called liquidator, is appoint to take control of company, collect its assents, pay its debts and finally if any surplus assents are left, they are divided among the members of the company in proportion to their rights under the articles. This being done the company is dissolved on compliance within the requisite formalities prescribed by the companies’ ordinance.
Process of winding up:
1. Selling of the assets of the company
2. Paying off the liabilities of the company
3. If there is any deficiency to pay to the creditors and the shareholders are called upon to pay unpaid amount on their articles.
4. In case of surplus, after paying off the liabilities, it may be distributed to the contributories according to their rights under the articles.
5. At the end, the Registrar of Companies removes the name of the company from the Register of Companies which is maintained by his office.
Compulsory winding up by the court
A company formed and registered under the ordinance, may be wound up by the court. This kind of winding up is also called compulsory winding up.