A DRT must fairly consider targeted cross-examination and document requests relevant to disputed recovery claims.

Canara Bank filed O.A. No. 1665 of 2014 before the DRT seeking recovery of approximately ₹1.94 crore.

The company disputed the Bank’s claim and alleged, among other things, fraud and undervaluation in the sale of its secured property.

During the DRT proceedings, the company sought cross-examination of the Bank’s witnesses and production of documents concerning the loan account and the claimed outstanding amount.

The DRT rejected those requests, reasoning in part that challenges to SARFAESI measures belonged elsewhere and that the proceedings had already been delayed.

The High Court dismissed an earlier writ petition concerning the DRT proceedings but granted liberty to raise the relevant grounds before the Tribunal.

The company then challenged the DRT’s orders dated 30 May 2025 and 31 October 2025.

1. Whether the DRT was justified in refusing the company’s requests for cross-examination and production of documents in the recovery proceedings, where the company disputed the Bank’s claim and alleged fraud.

2. Whether the requests could be rejected on the basis that the company’s grievances concerned SARFAESI measures, without separately considering their relevance to the Bank’s recovery claim under Section 19(1) of the RDB Act.

Under Section 22 of the Recovery of Debts and Bankruptcy Act, 1993 (“RDB Act”), the DRT is guided by the principles of natural justice and is not bound by the procedure of an ordinary civil court; its summary procedure must nevertheless afford a fair opportunity to the parties.

Rule 12(6) of the DRT (Procedure) Rules, 1993 does not make cross-examination automatic, but permits the Tribunal to require a witness’s presence where the request is necessary, the witness can be produced, and the request is not intended to delay proceedings.

In Union of India v. Delhi High Court Bar Association, (2002) 4 SCC 275, the Supreme Court explained that the Tribunal has discretion over proof by affidavit and cross-examination, to be exercised consistently with the need for a fair and expeditious determination.

Documents specifically identified as relevant and necessary to the debt claim may be ordered to be produced, but the Tribunal may reject a fishing inquiry.

The DRT treated the company’s request principally as an attempt to contest measures taken under Section 13(4) of the SARFAESI Act.

The High Court held that this overlooked the distinction between a challenge to those enforcement measures and the Bank’s separate claim for recovery under Section 19(1) of the RDB Act.

The company also disputed the debt amount, account entries, and evidence given by different Bank officials—matters potentially relevant to the recovery claim and therefore requiring consideration on their merits.

The Tribunal should have assessed whether limited cross-examination and production of specifically identified documents were necessary, while excluding questions unrelated to the recovery claim and preventing delay through a firm schedule and costs where appropriate.

It remanded the matter for fresh consideration, directing the company to identify the issues for cross-examination; limiting cross-examination to matters relevant to the Bank’s Section 19(1) recovery claim; requiring individual assessment of the requested documents; and directing the DRT to manage the proceedings efficiently and decide the original application within three months.

The Tribunal must decide the applications on their merits, uninfluenced by the High Court’s observations.