The Hindu Business Line : `Securitisation Act has boosted debt recovery'

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Visakhapatnam Feb. 23 Recovery of bank loans has become speedier and easier after the enactment of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, according to the Chairperson of Debts Recovery Appellate Tribunal, Southern Region, Mr Justice K. Gnanaprakasam.

He said here on Friday that the Government, on the recommendations of the Narasimham Committee, had earlier enacted the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, as it was found that recovery by the public sector banks, in particular, was proving difficult through civil courts. But, this Act did not yield recovery at the expected level.

Then came the 2002 Securitisation Act, which was challenged by many borrowers, but the Act was upheld by the Supreme Court.

"The provisions of the Act are stringent, as a lot of public money is involved. Debt Recovery Tribunals (DRT) were set up in different parts of the country and five Appellate Tribunals at — Mumbai, Kolkata, Chennai, Allahabad and Delhi. The banks are happy with the Act," Mr Gnanaprakasam said.

The Southern Region DRTs disposed of 24,661 cases and 12,942 cases were pending till 2006. The following are the details of pending and disposed of cases, respectively, at the DRTs in Southern Region: DRT I (Chennai) 4,693 and 5,125; DRT II (Chennai) 991 and 2,197; Bangalore 1,889 and 7,187; Ernakulam 997 and 3,329, Hyderabad 1,522 and 3,545; Coimbatore 2,145 and 2,112; Visakhapatnam 705 and 1,166.

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