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CS Professional · Corporate Restructuring, Valuation and Insolvency · Debt Recovery and SARFAESI

The Appellate Tribunal has passed a transfer order under section 5A in favour of the DRT at Kolkata. The DRT at Chennai, where Bank B's application was pending, argues that the RDB Act, 1993 gives it independent jurisdiction and it need not comply. Is this argument tenable?

The argument fails. Section 5A(3) says that, notwithstanding the Recovery of Debts Act, the Appellate Tribunal's transfer order binds all the DRTs concerned as if passed by the Appellate Tribunal having jurisdiction over each. No bank consent or further confirmation is needed.

  1. ANo, the order binds all the DRTs concerned notwithstanding the RDB Act, as if passed by the Appellate Tribunal having jurisdiction over eachCorrect
  2. BYes, because the RDB Act, 1993 prevails over the SARFAESI Act
  3. CYes, unless Bank B consents to the transfer
  4. DNo, but only if the Supreme Court confirms the order

Explanation

Section 5A(3) begins with a non-obstante clause over the RDB Act, 1993 and makes the Appellate Tribunal's order binding on all DRTs concerned as if passed by the Appellate Tribunal having jurisdiction over each. Consent of the bank or confirmation by the Supreme Court is not required.

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