Debt Recovery in India: Advisory Services

Civil Recovery Suits

A civil recovery suit before the Civil Court is the general route for recovery of a commercial debt. The suit proceeds through filing, service, written statement, evidence, and judgment. Under the Commercial Courts Act 2015, commercial disputes in the High Courts are subject to prescribed timelines and structured case management that has materially improved recovery timelines. An interim attachment order — attaching the debtor’s assets before judgment — is available where the creditor can demonstrate that the debtor is likely to dissipate assets. Execution of a decree once obtained is a separate process: the creditor must file an execution application and identify the debtor’s attachable assets for court auction. The firm files civil recovery suits, applies for interim attachment orders where assets are at risk, and manages the complete execution process from decree through to realisation.

Summary Suits — Fast-Track Recovery for Liquidated Debts

For liquidated debts arising from written contracts, bills of exchange, or negotiable instruments, a summary suit under Order XXXVII of the Code of Civil Procedure,1908(“CPC”)provides a faster route to judgment. In a summary suit, the defendant must apply for leave to defend within 10 days of service — leave is granted only where there is a genuine triable issue. Where leave is refused or not sought, judgment is entered summarily, typically within weeks rather than the months of a contested civil suit. Summary suits are particularly effective for trade debts evidenced by invoices, accepted purchase orders, or promissory notes where the debtor has no credible defence on the merits. ATB Legal advises on the availability of the summary suit route for each debt and files the plaint and leave-to-defend proceedings where appropriate.

DRT Proceedings & SARFAESI Enforcement

For banks and financial institutions seeking recovery of debts above Rs 20 lakh, the Debt Recovery Tribunal (“DRT”)provides a specialist forum with jurisdiction specifically designed for financial sector debt. DRT proceedings are faster than civil court proceedings, the tribunal has powers to issue recovery certificates and attachment orders, and the Recovery Officer enforces the recovery certificate. For secured creditors,  the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI”)SARFAESI Act 2002provides an out-of-court enforcement route — allowing banks and notified financial institutions to enforce security interest without court intervention. ATB Legal advises banks, NBFCs, and financial creditors on DRT proceedings, SARFAESI enforcement, and the interaction with IBC applications where the debtor is facing insolvency.

Recovery from NRI and Overseas Debtors

For GCC-based creditors owed money by Indian debtors, the recovery challenge has a cross-border dimension: service of process on an overseas creditor, attachment of India-held assets in support of a UAE judgment or award, and the practical management of proceedings from a distance. Where the Indian debtor is a company in default of Rs 1 crore or more, the  demand notice as per Section 8 of the Insolvency and Bankruptcy Code,2016 (“IBC”) and National Company Law Tribunal (“ NCLT”) application route provides a powerful recovery lever without requiring a prior court judgment. Where the debt arises from a UAE court judgment or arbitral award, the enforcement pathway in India depends on the applicable bilateral framework. The firm advises GCC-based creditors on the most effective recovery route, coordinating India-side proceedings from the same team that understands the UAE context.