RDDBFI Act - 1993
The Debts Recovery Tribunals (DRTs) and Debts Recovery Appellate Tribunal (DRATs) were established under the Recovery of Debts Due to Banks and Financial Institutions Act (RDDBFI Act), 1993 with the specific objective of providing expeditious adjudication and recovery of debts due to Banks and Financial Institution. The DRTs are empowered to adjudicate claims of banks and FIs involving rupees ten lakhs and above.
Where a bank or Financial Institution has to recover any debt from any person, it makes an application called Original Application (OA) to the Tribunal against such person/ entity. After adjudication, the DRT issues order and Recovery Certificate, certifying the amount payable by the borrower to the bank or Financial Institution. This Recovery Certificate is thereafter executed by Recovery Officers attached to the DRT.
| No. | RDDBFI Act | SARFAESI Act |
| 1 | It provides for recovery of debts of Banks & FIs through quasi-judicial tribunals called Debt Recovery Tribunals | It empowers Banks and FIs to recover secured debts directly without intervention of judicial process |
| 2 | Enforce action against the secured assets and the personal assets of Directors/ / Partners/ Proprietor/ Guarantors | Enforce action against secured assets which are secured by way of underlying security in the nature of mortgage, charge, hypothecation, assignment, etc. |
| 3 | Recovery of debt more than Rupees ten lakhs | Recovery of debt more than one lakh rupees |