Submit list of corporates with dues of over Rs 500 crore : Supreme Court
5 Dariya News
New Delhi 03-Jan-2017
The Supreme Court on Tuesday asked the Centre to place before it within four weeks a list of corporate entities with outstanding debts in excess of Rs 500 crore and details of cases pending before Debt Recovery Tribunals (DRTs) and Debt Recovery Appellate Tribunals (DRATs) for more than 10 years.The court sought latest details on cases pending before the DRTs and DRATs and the amount involved.The apex court noted that "more than 70,000 cases involving approximately Rs 5 lakh crore are pending before the Debt Recovery Tribunals, of which many are pending for more than 10 years".The Supreme Court directed the Centre to file an affidavit furnishing information on five counts, including infrastructure and manpower of the DRT and DRAT. The bench of Chief Justice T.S. Thakur, Justice A.M. Khanwilkar and Justice D.Y. Chandrachud said that the filing of the affidavit will not impede the functioning of a committee set up by the government in the matter.Pendency of cases before the DRT for over 10 years assumes significance since under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, the DRT is mandated to decide on the application of outstanding debts by the public sector banks and financial institution within 180 days.The court also sought information on whether the timelines set down in the amended legislation were capable of being achieved with existing infrastructure, including judicial personnel and staffing pattern of the Debt Recovery Tribunals and Appellate Tribunals.
The court is referring to the new timelines set under the Enforcement of Security Interest and Recovery of Debt Laws and Miscellaneous Provisions (Amendment) Act, 2016.Pronouncing the order, Justice Chandrachud said: "Legislative changes to provide for expeditious disposal of proceedings before the Debt Recovery Tribunals may not by themselves achieve the intended object so long as the infrastructure provided to the tribunals is not commensurate with the burden of the work and nature of judicial duties."To buttress its misgivings that the infrastructure provided to the DRTs and DRATs was inadequate, the Supreme Court referred to a letter written by Allahabad-based DRAT chairperson, wherein he said that he was "constrained to tender my resignation from the post since, in the absence of infrastructure and facilities, the functioning of the adjudicating body over which I presided had become impossible"."This is symptomatic of a trend whereby the Debt Recovery Tribunals and Appellate Tribunals suffer from a lack of adequate infrastructure, manpower and resources," the court said.It pointed out that given the important role these tribunals have been entrusted with "the efficacy of parliamentary legislation will depend in a large measure on the efficiency with which the tribunals discharge their duties".The court also sought information on the basis on which revised timelines have been stipulated and whether any scientific study has been conducted on the availability of infrastructure and the steps the government was taking to augment the infrastructure of DRTs and DRATs.The court also sought details of any specific action plan, including time schedule within which the existing infrastructure would be upgraded.