Recovery Of Debts: SC Seeks Big Loan Defaulters’ List [Read Judgment]

A list of corporate entities where the debt amount outstanding is in excess of Rs.500 crore and empirical data on the pendency of cases for more than 10 years have been sought The Supreme Court in Centre for Public Interest Litigation Vs. Housing and Urban Development Corporation & others has raised specific queries to the Central government with regard to strengthening of infrastructure to speed up retrieval of loans.The bench headed by Chief Justice of India TS Thakur has also sought from the Centre a list of corporate entities, where the debt amount outstanding is in excess of Rs.500 crore.The bench observed that about 70,000 cases involving about Rs.5 lakh crore are pending before the Debt Recovery Tribunals, of which many are pending for more than 10 years. “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,” the bench said.The court also observed that Debt Recovery Tribunals and Appellate Tribunals suffer from a lack of adequate infrastructure, manpower and resources. The bench then raised the following specific queries and asked the Central government to file an affidavit within a month: Whether the timelines set down in the amended legislation are capable of being achieved with the existing infrastructure, including judicial personnel and staffing pattern of the Debt Recovery Tribunals and Debt Recovery Appellate Tribunals; The underlying basis, if any, upon which the revised timelines have been stipulated and whether any scientific study has been conducted on the availability of infrastructure; Whether, and if so, what steps the Union government intends to adopt to enhance the infrastructure of Debt Recovery Tribunals and the Appellate Tribunals in terms of physical infrastructure, judicial manpower and non-judicial personnel required for the efficacious functioning of the Tribunals; The specific plan of action including time-schedules within which the existing infrastructure would be upgraded so as to achieve the time frame for disposal indicated in the amended legislation;Empirical data on the pendency of cases for more than 10 years and the list of corporate entities where the amount outstanding is in excess of Rs.500 crore.Read the Judgment here.This article has been made possible because of financial support from Independent and Public-Spirited Media Foundation.

Recovery Of Debts: SC Seeks Big Loan Defaulters’ List [Read Judgment]

Ashok KM

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