Srinagar, Oct 26: The Federation of Chambers of Industries Kashmir (FCIK) has reiterated its demand for the establishment of a Debts Recovery Tribunal (DRT) within Jammu and Kashmir.
Taking up the matter with Chief Minister Omar Abdullah, the Federation highlighted the financial burden, inconvenience and difficulties in securing effective legal representation faced by local borrowers compelled to pursue proceedings at Chandigarh.
In its representation, FCIK has requested the Chief Minister to pursue the matter with the Union Finance Minister and the Secretary, Department of Financial Services, Ministry of Finance for establishment of a permanent DRT with regular sittings in Srinagar and Jammu, and scheduled circuit sittings in both cities pending its establishment.
The Federation said it had received a number of complaints alleging that engaged counsel, despite receiving professional fees, failed to pursue cases or attend proceedings, resulting in ex parte decisions.
“These complaints merit serious examination and highlight the vulnerability of borrowers who can neither afford repeated travel to Chandigarh nor readily monitor their cases. When engaged counsel fail to appear, borrowers risk ex parte decisions and enforcement against their businesses and assets without their defence having been effectively presented,” FCIK stated.
The Federation emphasised that borrowers had earlier enjoyed access to local remedies. Referring to the Hon’ble High Court’s judgment in M/s Hotel Alpine Ridge and Others v. Union of India and Others, dated April 12, 2024, it noted that Sections 17-A and 17-B of the SARFAESI Act had provided remedies through the District Court and High Court in the erstwhile State. Following the statutory changes accompanying the 2019 reorganisation, jurisdiction came to be exercised by the Chandigarh DRT, with the September 10, 2021 notification, S.O. 4145(E), providing for its extension to J&K.
“Borrowers who previously had recourse to local judicial institutions now have to pursue their statutory remedy outside J&K. The resulting cost and difficulty deserve an institutional response,” the Federation said.
FCIK pointed out that the Department of Financial Services’ annual report for 2025–26 listed 39 DRTs across the country, including three at Chandigarh, but none within Jammu and Kashmir. It urged the Union Government to assess local requirements in terms of accessibility, geography and borrowers’ financial circumstances, alongside caseload.
The Federation recalled that the High Court had described proceedings at Chandigarh as cumbersome, inconvenient and expensive, and observed that establishing DRTs or benches/circuit benches within J&K and Ladakh could address these difficulties. The Court had also recorded shortcomings in virtual participation, including connectivity problems that led to directions for physical appearance.
FCIK Head of the Advisory Committee Shahid Kamili said repeated travel, accommodation costs, legal expenses and absence from business placed an additional burden on entrepreneurs already struggling with financial distress.
“Banks have every right to recover lawful dues. Borrowers must equally have an affordable and meaningful opportunity to be heard. A statutory remedy must be accessible in practice,” he said.
Besides a permanent tribunal and interim circuit sittings, FCIK has sought direct electronic hearing alerts to borrowers alongside counsel, and prompt access to orders.
The Federation urged the Chief Minister to support a formal proposal with a relevant offer for suitable premises to facilitate an early decision by the Union Government. Accessible adjudication, it said, would strengthen fair and timely resolution of disputes while complementing the Government’s efforts towards industrial revival.
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