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CS Professional · Insolvency and Bankruptcy - Law and Practice · Debt Recovery and Securitization

Ganga Steels Ltd's secured asset is a warehouse in Nagpur. The loan account is maintained at the Kolkata branch of Eastern Bank, and the bank's measure was taken after a notice issued from its Mumbai regional office. Ganga Steels wishes to file a section 17 application. Which DRT may validly entertain it?

The application may be filed before any DRT having jurisdiction under section 17(1A): where the cause of action arises wholly or in part, where the secured asset is located, or where the branch maintaining the debt account is situated. It is not restricted to a single location.

  1. AOnly the DRT in Mumbai, where the notice was issued
  2. BOnly the DRT in Kolkata, where the account is maintained
  3. COnly the DRT in Nagpur, where the asset is located
  4. DThe DRT within whose jurisdiction the cause of action arises wholly or in part, the asset is located, or the branch maintaining the account is situatedCorrect

Explanation

Section 17(1A) allows filing before the DRT where the cause of action arises wholly or in part, where the secured asset is located, or where the bank branch maintaining the account with the outstanding debt is situated. So Nagpur, Kolkata and potentially Mumbai (cause of action in part) are all available; restricting to a single place is incorrect.

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