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Employee-Directors cum guarantors are liable for repayment of the whole of the loan amount
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 It is quite common for employee-Directors to act as guarantors for the loans taken by their Companies. A few of them even deposit title deeds of their personal properties as collateral guarantee for the loans. Such employee-directors have personal liability to Bank for repayment of the entire loan amount even after they have resigned from the Company. The liability of such directors has always remained a bone of contention between them and the Bankers, the Company (the principle borrower) and the current directors. Such employee - directors-guarantors cannot escape responsibility for the repayment of the loans by the company, whether they are in the company or have since resigned.
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The DRT must adjudicate the claim of the applicant only.
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The Debts Recovery Tribunal (DRT) must confine its decision only to the pleadings made by the applicant. The DRT should not go into the pleadings of respondents/ defendants and adjudicate their claim for apportioning of the sale proceeds of assets secured to the applicant.
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Limitation for enforcing foreign judgments before DRTs is 3 years.
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The Debts Recovery Tribunals can enforce orders and judgments issued by foreign Courts for the recovery of debts due between a Bank and its borrower in that country. On the basis of such a judgment the DRT can issue a Recovery Certificate. However, the applicant or judgment creditor bank has to file an application before the DRT within a period of three years from the date of judgment. The period of limitation cannot be extended irrespective of the conduct of the parties during the period.
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