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DRT Cases particularly those who have just received notices u/s 13(2) or 13(4)
will be greatly benefited if they ring to us at Mob - 9691103689 (from 11AM to 6
PM on weekdays:-
You get instantaneous advice on the said mobile no.
Best Approach in DRTs for Borrowers & Guarantors :-
(1)
If you are our client, our consultation is available to you at any time on
24/7 basis. (2) We encourage you to acquire basic knowledge so that you may
interact with us as well as your advocate properly. (3) We insist that you
must always be present in the Court along with your advocate. You get
instantaneous
advice on our mobile no. 9691103689 .
Safeguards under Sec 14 of Sarfaesi Act -
Pl contact us on phone as soon as you received notice under
Sec 13(2) of Sarfaesi Act, we shall advice you for necessary precautions and
safeguards.
Senior Citizens - Longevity
दीर्घायु
&
Health Problems -
I am 78 years young as on 01.01.2021 and my hobby is to maintain good health, rather becoming
younger day by day. Recently I have published few important videos
[ (1) दीर्घायु क्यों व कैसे (2) दीर्घायु उपयोगी चर्चा (3) दीर्घायु व घुटनों
की समस्या (4) दीर्घायु व वृध्दावस्था के लिए अमृत है कीटो डाइट]
on Facebook
and YouTube on the important topic of Longevity ie
दीर्घायु To reach to my the said videos, you may search ' Ram Kishan
Longevity' or रामकिशन दीर्घायु in Google
or YouTube. My profile link on facebook is
https://www.facebook.com/ram.kishan.777
DRT Judgments Favourable to Borrowers and Guarantors – Now Full text of such
Judgments is being provided on this Web Site with Important Portions marked in
Red
For reference of such judgments please click DRT Judgments Favourable / Useful to Borrowers
Our Client wins in Securitisation Appeal against 4 Banks in DRT – amount
involved nearly Rs. 90 crores and a tooth & nail fight of 4 years
Entire Judgment reproduced vide link
DRT Orders in favour of Borrowers & Guarantors
Important Victory of Our Client against Bank:-
One of our important clients at Chandigarh who filed damage suit of Rs. 1825
crores against a public sector Bank on 13.01.05 registered an important victory
on 03.03.07 when the Court waived the entire court fee despite all opposition by
the defendant Bank. The alleged dues of the Bank are Rs. 30 crores. Since the
damages are much more than the alleged claim of the bank, no recovery action can
be executed till the said damage suit is finally decided. The usual delay in the
litigation does not affect our client as the damages are increasing day by day
due to interest charges at rate which is much higher than the increase in the
alleged claim of the bank. The said damage suit was drafted by us and all
necessary advice and guidance was provided on all dates of proceedings.
Counter-claim is the only defence for the borrowers against Notice under
Securitisation Act
and or Original Application under the DRT Act:-
Under the present provisions of law,
the only legal defence for the borrowers is
Counter-claim giving quantum of loss and damages suffered due to wrong doings of
the lenders. The pleadings must be prepared by a person having mastery of facts
and mastery of law. The documents such as project report, application for
financial assistance, loan sanction letters, correspondence, balance sheets,
annual reports need to be referred to properly keeping in view the law of
pleadings, law of torts, law of damages, principles of natural justice, equity
and good conscience. If you are unable to get such pleadings prepared, our
professional services may be utilized. With our drafting of pleadings, you get
additional advantage of expert advice during course of litigation from beginning
to end. Since our clients are from all parts of the country and due to our
focussed attention, you get complete and exhaustive guidance. All our clients
are having upper hand over the lenders. In many cases the lenders have come
forward to waive total interest and settle at fraction of the principal amount.
In one of the cases, the proposal of the lender is to waive the total claim provided
the borrower withdraws the damage claim, which the borrower has declined.
Counter-claim must be prepared much in advance of of the Notice under
Securitisation Act or filing of the Original Application under the DRT Act:-
The
counter-claim or damage suit must be prepared much in advance of the recovery
action initiated by the lender. The most appropriate stage is as soon as the
lender declares the unit as NPA. The said counter-claim or damage suit must be
ready before the lender issued Notice under Securitisation Act or files Original
Application is filed by the lender in DRT. With such advance action only, the
counter-claim or the damage suit will attain proper quality standards from legal
considerations. As soon as the legal Notice from the lender under Securitisation
or DRT Act is received the said counter-claim or damage suit is updated and
filed before expiry of the Notice Period. Since prima facie there is no debt
due, the lender can not take any action for the possession of the assets till
the litigation pertaining to the said counter-claim or damage suit is decided by
the court of law. Even if any attempt is made by the lender to take possession,
the property can not be sold. Further steps in the DRT should be as outlined in
the next para.
Winning bank litigations in DRT:-
The first step is perfect pleadings drafted by a
person having mastery of facts and mastery
of law. The borrower must setup his counter-claim in money value based on law of
damages and law of torts. In almost all the cases, the counter-claim is much
more than the claim of the lender. These are the condition precedents before
commencement of litigation in DRT. The next important step is thorough
preparation of the case by the borrower as well as his advocate much in advance
of the commencement of the trial in DRT. The borrower and his advocate must
prepare at least 7 days before the date. In case the counter-claim has been
drafted by us, the outcome of the said preparation must be discussed with us on
phone so that our guidance is also available prior to the date. The proceedings
on the date must be properly recorded in the DRT. All the relevant facts must be
obtained much before the arguments and through preparation must be made. No
arguments be held at any stage till all the facts are discovered. Long dates
should be resisted. With proper alertness and vigilance by the borrower who must
work in unison with his advocate in advance will ensure winning bank litigations
in DRTs. It must be understood that the battle is long drawn, time consuming and
expensive. Even after winning in DRT, the borrower and his advocate will have to
work hard in facing the appeals in ADRT, High Courts and Supreme Court. If the
pleadings are drafted by us, we provide all guidance from DRT to Supreme Court.
We
receive lot of queries seeking our replies, opinion and common queries used to
be replied as under:-
and
comments on matters of current interest. Some of these queries also emanate from
various forums and groups relating to bank, drt, financial institutions,
appellate drt, civil courts, high courts and supreme court and various decisions
of these courts. While we reply to individual queries, we thought it proper to
reproduce our replies here also so that it benefits other visitors of this site.
Date wise queries and replies are as under :-
Transfer of Ownership or Sale of Unit should include Fair Compensation to the
Original Promoter :-
It is observed that in most of the cases, the original Promoter
invests much more than the Promoter's Contribution. Not only he spends all his
own financial resources, he borrows privately from his relatives and friends to
keep the project alive during the long drawn process of rehabilitation. On
account of any reason, if the the ownership of the unit is transferred or the
unit is sold, the Original Promoter must get fair compensation from the New
Owner. If there are any wrong doings on part of the lending banks and financial
institutions, the Original Promoter must raise his counter-claim. Since in most
of the cases, the said counter-claim is much more than the claim of the lenders,
the ownership of the unit can neither be transferred nor the unit can be sold.
Calculations of NPA, Debt Due and Rehabilitation Plan should include the factor
of Loss and Damage during the period under consideration:-
The
lending banks and financial institutions are required to be just,
fair and reasonable in calculating the NPA, Debt Due and Rehabilitation
Assistance. This is binding on them as per the Constitution of India as well as
several in conformity with the law laid down by the Supreme Court of India.
Normally they do not do so. The affected borrowers and guarantors should insist
for the same. If such considerations are made, the factor of loss and damages
caused by the lending banks and financial institutions must be included in the
calculations of NPA, Debt Due and Rehabilitation Assistance. The entire scenario
of debt recovery will undergo a sea change. In the pleadings prepared by us for
our clients, we incorporate these vital aspects.
Official Liquidator vis-a-vis Recovery Officer:-
The above functionaries
respectively are created out of Companies Act and DRT Act. Their
functions, duties and responsibilities are defined under the said acts. The role
of the Official Liquidator commences after the Company has been wound up.
Whereas the role of the Recovery Officer starts after the issue of the Recovery
Certificate by the DRT. Thus the jurisdiction, functions, duties and
responsibilities of both are entirely different. If any change is desired, the
same can be brought only after suitable legislation amending the corresponding
enactments. In most of the present cases of winding up or issue of the recovery
certificates, it is observed that such actions can not take place if the lenders
have caused any wrong doings resulting into industrial sickness. In such cases
if proper pleadings including counter-claim are made, the company deserves to be
rehabilitated instead of being wound up or getting recovery action initiated.
Third Party rights in the properties auctioned by the DRTs:-
The person taking the possession of the property which is subject matter of
disputes under adjudication with DRTs must conduct thorough search with the
Registrar or such agencies where ownership rights of the property are recorded
as per law. It is the duty of the person transferring such property towards the
person receiving such property. Further it is the duty of the owner of the
property to ensure that ownership details are recorded with legally prescribed
agencies. In light of these principles, the buyer of such properties or taking
on rent, proper precautions must be taken before taking physical possession of
such properties. If there are lapses, civil and or criminal cases must be filed
against the wrong doers and the matters be brought before DRT. Depending on the
facts of the individual case, the DRT will have to pass suitable order which if
not found acceptable, the affected person will have to appeal to ADRT and then
to the HIGH Court/Supreme Court. In the specific case of borrower and guarantor
being suffering and interested party, the only and most appropriate defence is
counter-claim in DRT or damage suit in civil court against the lender as
emphasized in this web site. Since in almost all the cases, the said
counter-claim or the amount in the said damage suit are much more than the claim
of the lender, there is no debt due and hence the recovery action, if any (
under DRT or Securitisation Act) is illegal. Accordingly the third party rights
if any on the property in question can not be disturbed.
Asset Reconstruction Companies will have to face counter-claim if wrong doings
committed by the original lenders :-
As per the existing law, the ARC (Asset Reconstruction Company) steps in the
shoes of the original lender the moment it takes over the assets. Such ARC must
know that while taking over the assets, it has to take over the liabilities
also. If the borrower has filed counter-claim or damage suit against the
original lender, after transfer of the assets, the said counter-claim will have
to be faced by the said ARC. If the borrower has not filed counter-claim, he
should file it now before the Civil Court.
Role of DRTs in
Revival and Rehabilitation of Sick Units:-
The courts
including DRTs, Civil Courts or Supreme Court award their findings or verdicts
depending on the facts brought out before them. On their own these courts have
no authority, power or jurisdiction for any executive action like reviving or
helping in revival of the sick units. The Recovery Officer or the Commissioners
appointed by him are supposed to act always keeping in view the principles of
equity, justice and good conscience. If they commit any wrong doings in the
process of sale, auction etc., the person committing wrong doings will be caught
and punished if the sufferer ensures
that
the prescribed process of law is followed and implemented.
The role of revival and rehabilitation has been entrusted to different
authorities specified in SICA Act 1985 and now to the NCLT (National Company Law
Tribunal)
The suffering or dissatisfied borrowers and guarantors have the only remedy of
counter-claim in DRT or damage suit in civil court.
Accusation for Delaying Tactics by the Borrowers in DRTs :-
It is stated that the High Courts have
commented that the defendant borrowers in DRTs are indulging in delaying
tactics. This normally
happen when the defendant borrowers and guarantors facing the usual financial
stringency of a sick unit as a result they are unable to fight DRT battle
properly. This may not happen when such borrowers study our web site and handle
the battle with personal involvement with their advocate. The situation improves
when they get pleadings and counter-claim drafted by us. As emphasized in our
web site that the pleadings must be drafted by such persons who have mastery of
facts and mastery of law before he commences drafting of the pleadings. Here
comes our role. We scrutinize all documents, project report, financial
application, appraisal reports, sanctions for financial assistance, documents
executed, disbursal process, actual disbursals, correspondence including various
litigations, balance sheets etc. Based on all these documents, the pleadings and
counter-claim is prepared and filed. In all such cases, it is found that the
lenders are unable to submit their written statements in time and they seek
adjournments. The whole table is turned and the lenders indulge in so called
delaying tactics. In all cases, their accounts are defective. They take months
and even years to rectify their errors. They are unable to submit suitable
defence to the counter-claim. This is the power of knowledge and command of
litigation process with mastery of facts and mastery of law. Many of our clients
under our guidance has exposed the lenders that they committed wrong doings by
delaying the sanctions, not disbursing the loans in time, not enhancing the
limits, huge delay in enhancements, all such wrong doings resulting into
sickness, not curing the sickness etc. With such approach, the lenders find very
difficult to fight with our clients and try to indulge the usual delaying
tactics. Thus the whole table is turned.
Supreme Court verdict in the case of Indian Bank vs ABS Marine:-
The Supreme Court of India has upheld the right
of the borrowers to file countersuit or damage suit against the lender in civil
court. In almost all the cases, the damage claim of the borrower is much bigger
than the lender, the execution of the claim of the lender will have to wait till
the said suit in civil court is fully decided. The said counter-claim can also
be adjudicated upon in DRT. if on account of any reason, if it is transferred
from DRT to Civil Court, the position in respect of the execution of the
lender's claim will remain the same. We have been upholding these views since
2001 as laid down in this web site since then as well as in our articles and
letters to editor published in the Financial Express since 2001. As a whole, the
principles of equity, justice and good conscience continue to remain applicable
in any court whether it is DRT or Civil Court. Since at present the judicial
process is expensive and long drawn, such cases can only be fought by the
borrowers who can mobilize financial resources to fight court battle and due to
such litigants only leading judgments will come, which will be useful to other
suffering borrowers and guarantors.
Litigation between
Lenders and Borrowers and Problems of Stressed Assets in India:-
(1) Lot of brainstorming interactions
and
open exchange of views are required if we are really keen to solve the
genuine problems of all the stake holders in a project.
(2) The
litigation between a borrower and a lending institution like a bank is just
like a fight between a sick child and a wrestler. If the principles of
equity, justice and good conscience are applied, in the very first instance,
such fight should not be allowed to be initiated.
(3)
Despite above, if such fight is to be initiated, the child needs to be
supported and equipped with fundamentals and skills required for the
proposed fight. This has been our approach.
(4)
Keeping above in view, our views are as under:-
The established judicial
process is quite strong provided it is implemented properly. First stage is
the pleadings which should be drawn by the person having mastery of facts
and mastery of law. The pleadings must contain the counter-claim. The
erring bank authorities including Chairman of the bank should be cross
examined in the witness box again by a competent person having mastery of
facts and mastery of law. If such process is followed, in almost all the
cases the banks will lose and instead of recovery of their claims, they will
have to pay the damages. For further details, kindly study contents of our
web site.
(5) The purpose is to start a dialogue for the
defendants borrowers and guarantors. Those who will be interested will come
forward with queries which will be replied suitably. The subject is so vast
and that is why I give reference to my web site as it is not possible
to elaborate due to shortage of time.
(7) It is needless to mention that our web site
www.drtsolutions.com occupies top ranking in various search engines in
numerous categories on account of which there are more than 1000 hits per
day. We have clients all over the country and they are slowly winning their
battles.
Our Replies to Queries prior to May '06
Justice is Supreme. Procedures, Provisions of Law and Machinery of Law have to
aim at getting Justice :-
In a democratic society like ours which is ruled
by Law, the Supreme Court of India has held that Justice is Supreme. Even the
law bends before Justice. The procedures are handmaid of Justice. The natural
corollary is that the complete court machinery like Civil Courts, DRTs, High
Courts and Supreme Court including their Judges exit and have to work only
achieving Justice in each and every case in most efficient manner.
The established judicial process is quite strong provided it is implemented
properly. First stage is the pleadings which should be drawn by the person
having mastery of facts and mastery of law. In the specific legal defence of the
borrowers and guarantors in DRTs, the pleadings must contain the counter-claim.
Then the erring bank authorities including Chairman of the bank should be cross
examined in the witness box again by a competent person having mastery of facts
and mastery of law. If such process is followed, in almost all the cases the
banks will lose and instead of recovery of their claims, they will have to pay
the damages.
Proof by Affidavit in DRT is not sufficient in most of the cases where it calls
for examination of Bank Officials :-
In almost all the cases of our clients, we have
observed that the affidavits filed by the bank officials do not offer complete
proof. Hence the said bank officials including the Chairman and the Branch
Managers need to be examined and cross-examined in the witness box. The
defendants must be vigilant and careful to ask for the same. The cross
examination of the bank officials must be carried out by a person having mastery
of facts and mastery of law. The entire cross examination of the bank officials
must be video taped and submitted as document in form of the CD. Then only the
defendants can be sure to win their cases including the counter-claims. We offer
our professional services in conducting such cross-examination.
Affidavit on behalf of the Bank must be signed by the Chairman:-
The Branch Manager and other officials of the
Bank may submit affidavit on their behalf but the affidavit on behalf of the
Bank must be signed by the Chairman of the Bank.
NPA, Debt due and Rehabilitation of Sick SME Industries:-
At present there is gross mistake in calculation
of NPA and Debt due and accordingly the Rehabilitation Plans of the potentially
viable sick industries are also wrong. We point out these deficiencies in
individual cases of our clients.
Affidavits for our clients:-
Few of our clients have started approaching us to
prepare their affidavits as they find that their advocates are not having
required spare time for such technical job. You may also approach us for this
specialized service.
Cross Examination
of Bank Officials:-
Many of our clients find that their advocates are
not having sufficient knowledge to cross examine the bank officials like Bank
Managers and Chairmen of the banks and financial institutions and approached us
for such highly specialized service. In fact we are uniquely suited for the same
due to our focussed and specialized knowledge and experience in this field.
Counter-claim
can be filed at any stage:-
We have prepared counter-claim even during
winding up of the companies, after the final order of the DRT or at any stage of
the trials in DRTs or ADRTs. Since the counter-claim is based on law of torts
and continuing cause of action, it can be filed at any stage. In one case we
have prepared counter-claim after 21 years. We need one and half to two months time for
preparation of counter-claim. If there is no such time available, we devise
legal methods to gain time. Goal of any litigation or legal procedure is
attainment of Justice. We help the borrowers and guarantors to get Justice at
any stage of litigation.
Importance and Essentiality of proper defence
for borrowers and guarantors:-
Whole case can be fought and won only when proper
defence has been made right from the beginning. Such defence should be made by
person having mastery of facts and mastery of law. Here facts refer to those
applicable to the individual case with thorough understanding of banking,
business and industrial finance and their violations as well estimate of loss
and damages based on project report and balance sheets. The law refers to all
the relevant laws applicable to banking and finance right from 1949 as well as
law of torts and damages. We are acclaimed expert and specialized agency to
prepare such defence with uptodate current knowledge due to handling of such
matters from clients all over the country. A phone call will help you in solving
all problems relating to DRT, ADRT, BIFR, NCLT, Securitisation Act etc.
Cross-examination of bank officials:-
Evidence and cross-examination of bank officials
including the Chairman and Branch Manger is highly essential. The sole aim is to
get admissions of the wrong doings. Once the wrong doings have been admitted in
the witness box by the bank officials, the borrower/guarantor has won the case
as there is no arguments on admissions even upto the stage of Supreme Court.
Such cross-examination of bank officials is highly technical and it requires
mastery of facts and mastery of law. We have requisite expertise in this arena.
The parties desiring us to conduct the cross-examination, may contact us on
phone for necessary further action.
Supreme Court Judgments:-
Many of our clients and visitors of this site
approach us for Supreme Court and High Court Judgments. We would like to inform them that
judgments are available only on those matters and facts which have been
adjudicated upon. Many of the issues relating to industrial and business finance
have not yet been brought before the judiciary and hence no judgments will be
available on the same. The counter-claims based on the law of torts drafted by
us are being put before the judiciary for the first time. These matters and
facts need to be processed during proper judicial process by way of proper
pleadings, cross examination and arguments. The judgments thus obtained will go
through the process of appeal by the affected party and thus all such cases will
take few years to come before the Supreme Court and then only the final
judgments of the Supreme Court will come. Till then we have to work on the basis
of the fundamental of the law. We are following this approach in tackling all
DRT problems and Solutions whether in DRT, ADRT, High Courts, BIFR, NCLT in
future and Supreme Court.
Right to Information Act 2005 It
is a an epoch making legislation for public including industrialists and
business people to obtain informations from the government and its
instrumentalities regarding the duties and responsibilities towards public and
their customers. This act will prove to be a powerful tool in tackling
DRT problems and finding solutions.
Our Client wins against Bank, DRT Mumbai
declares possession of factory illegal under Securitisation act:-
in the matter of M/s Aarti Cables vs Bharat Co-operative Bank, the PO DRT Mumbai
passed an important judgment on 16.09.05 against the bank declaring the possession of the
factory under
Securitisation Act as illegal.
Cross Examination of Chairmen of Banks or FIs is a must :-
You get only one and last opportunity for trial in DRT. In RBI Guidelines, the
Chairman of the banks and FIs have been held specifically responsible. You must
make them a party, in pleadings mentioning that you would be cross examining them.
Go to their offices and make video recording of the cross examination. Be
very strict on this aspect as the legislation has made appeal nearly next to
impossible to expect any relief.
Bombay High Court rules in Borrower's favour in respect of Notice under
Securitisation Act-
On 6th Sept. '04, the Bombay High Court ruled in favour of the Borrowers,
canceling the impugned notices under the Securitisation Act. vide details and
our comments by clicking here :-
Securitisation Act-Comments
The bank will have to return the properties taken in possession under the
Securitisation Act.
DRT rules in Borrower's favour, asks Bank to pay Damages-
Vide news item at page 8 of the ET dated 17.07.04 with the title as "It's a
first, DRT rules in borrower's favour, asks bank to pay damages" This is
the first time under the Securitisation Act that a bank has lost a case against
a borrower in DRT. The bank has been asked by
DRT Mumbai to return the secured property back with per day damages as well as
cost of the appeal preoceedings in DRT. Please vide details and our comments by clicking here :-
Securitisation Act-Comments
Important Questions and our Answers in respect of Securitisation Act-
A leading Financial Association of the country has asked 6 important questions
and desired to publish the answers in form of our interview. The said questions
and answers can be seen by clicking here:-
Securitisation Act-Comments
The visitors and readers my interact by sending e-mails to us.
Progress of
counterclaim of Rs. 1864.14 crores filed by one of our clients at Indore facing
alleged recovery of Rs. 69.23 crores in DRT Jabalpur:-
The DRT counterclaim was drafted by us and the
case was filed in December 2002. The details may be seen by clicking
here
DRT Cases Handled by Us
The party has reported that the applicant bank is finding difficult to
fight the court battle in DRT. Instead the bank has become jittery and is troubling the
party and is creating hurdles in getting finance from other banks. It is
indulging in further wrong doings amounting to defamation, about which the party
has reported to DRT. The party has given us the assignment to prepare
their affidavit, They also desired that we should conduct the cross examination
of the bank officials at appropriate time.
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