Legal Service India - Unnecessary Litigations/Tactics By Borrowers Must Be Precluded
law  in India

Unnecessary Litigations/Tactics By Borrowers Must Be Precluded

Written by: Kumar Ravish B.S.L. IInd Year Symbiosis Law, Pune
click here for LIVE help-desk
Chat with us  (2 PM - 9 PM IST)
Legal Advice | Find a lawyer | Constitutional law | Judgments | forms | PIL | family law | Cyber Law | Law Forum | Income-Tax | Consumer laws | Company laws
Search On:laws in IndiaLawyers Search

Copyright Online in India
Right from your Desktop - Ph no: 9891244487

Home \ Company Law

Latest Articles | Articles 2013 | Articles 2012 | Articles 2011 | Articles 2010 | Articles 2009 | Articles 2008 | Articles 2007 | Articles 2006 | Articles 2000-05

It is pertinent to mention that the reluctance of borrower in payment of their debts to banks and other financial institutions has given rise to various economical problems. It is not only immensely damaging the development of public and private sectors banks and other financial institutions but also leading to demoralize the Indian economy which is already on a down track.

In early nineties of 20th century it was found that the existing procedure for recovery of debts due to the banks and financial institutions has blocked a significant portion of their funds in unproductive assets, the value of which deteriorates with the passage of time. To cope up with this problem their followed the recommendations of several committees viz. Narasimham Committee and Andhyarujina Committee, appointed by the Central Government, which were solely constituted to examine reforms in banking sector and to consider the need of change in the legal system for recovery of their outstanding dues.

This followed the enactment of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 then The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, to expedite the recovery of outstanding dues of banks and other financial institutions from the defaulting borrowers.

These enactments have led to great significant changes in the recovery of dues from the borrowers but still huge amount of public money is locked in litigation which is preventing its proper utilization and re-cycling of the funds for the proper development of the country.

The litigations for recovery of dues must be concluded expeditiously so that Non Performing Assets (NPAs) could be well utilized for other purposes, but this idea of several legislations in this context has been continuously frustrated by the way borrowers are defending the litigations against them and bring litigations against the creditors, to avoid repayment of the loan.

Leaving the general procedure adopted by the borrower in avoiding repayment of the loan and its interest, it is in general practice of the borrower to file litigation against the creditors to fetch some more time to sustain. Or whenever a suit for recovery of outstanding dues is brought against a defaulting borrower, it is in practice to intricate the matter and to prolong the judicial proceedings by filing many miscellaneous cases/applications, petitions for adjournment, petitions on several occasions by invoking elusive points etc.

I am of the view that this practice by the borrower should be precluded immediately by way of legislation/rules/orders, which is expedient now and which must comprise of the ways to preclude unnecessary litigations/tactics by the borrowers, but this must also safeguard his inherent interest and right to sue and defend.

Legislation/rules/orders which keeps a check on unnecessary petitions for adjournment, unnecessary supplementary applications, cross suits on the creditors, unnecessary stay orders etc.

The judicial system which seems to be very liberal towards the defaulting borrower must come out with some harsh rulings to press the defaulting borrowers to repay the loan.

In Mahmad Manzoor Alam V. State of Bihar & Others {PLJR 2003(2), 148} the Hon'ble High Court of Patna has dismissed the petition with costs on the ground that the petitioner who defaulted in repayment of loan, resorted to legal engineering to avoid the liability of repayment. The court observed that the debts, if not pad, contribute to the deficit financing of the nation's planned economy and affects the persons also who have nothing to do with these loans and who get lined up unconsciously for making up these bad debts by paying taxes, direct or indirect.

There is a need to revive the thinking of the defaulting borrowers, who have made their habit by litigations and other legal engineering to avoid repayment of loan, which can only be done by strict legislation/rules/orders.

More Articles:
Interpretation of Fiscal Statutes
Counter Measures - disputes in International Law
Unnecessary Litigations/Tactics By Borrowers
Foreigners: Visa & Registration

The author can be reached at: agrawalshyam@legalserviceindia.com / Print This Article

Lawyers

Lawyers Search

Find a lawyer
Know your legal options
Information about your legal issues

File Mutual Consent Divorce

Right Away
Call us at Ph no: 9650499965
Copyright Registration Online Right from your Desktop...
*Call us at Ph no: 9891244487

Legal Advice

Get legal advice from Highly qualified lawyers within 48hrs.
with complete solution.

    Your Name                Your E-mail
          

Legal Service India

lawyers in Delhi
lawyers in Chandigarh
lawyers in Allahabad
lawyers in Lucknow
lawyers in Jodhpur
lawyers in Jaipur
lawyers in New Delhi
lawyers in Nashik
Contract laws
Protect your website
Army law
lawyers in Mumbai
lawyers in Pune
lawyers in Nagpur
lawyers in Ahmedabad
lawyers in Surat
Faridabad lawyers
Noida lawyers
lawyers in Dimapur
Trademark Registration in India
Woman issues
Famous Trials
lawyers in Kolkata
lawyers in Janjgir
lawyers in Rajkot
lawyers in Indore
Gurgaon lawyers
Ghaziabad lawyers
lawyers in Guwahati
Protect your website
Law Colleges
Legal Profession
Transfer of Petition
Lawyers in India - Search by City legal Service India
lawyers in Chennai
lawyers in Bangalore
lawyers in Hyderabad
lawyers in Cochin
lawyers in Agra
lawyers in Siliguri
Lawyers in Auckland
Cause Lists
Immigration Law
Medico Legal
lawyers in Dhaka
lawyers in Dubai
lawyers in London
lawyers in New York
lawyers in Toronto
lawyers in Sydney
lawyers in Los Angeles
Wills
Cheque bounce laws
Lok Adalat, legal Aid and PIL

About Us | Privacy | Terms of use | Juvenile Laws | Divorce by mutual consent | Lawyers | Submit article | Lawyers Registration | Sitemap | Contact Us

legal Service India.com is Copyrighted under the Registrar of Copyright Act ( Govt of India) 2000-2015
ISBN No: 978-81-928510-0-6