Business, Economy & Banking Current Affairs

Government doubles monetary limit for filing cases in DRT

 Union Finance Ministry has doubled pecuniary limit to Rs. 20 lakh from Rs.10 lakh for filing loan recovery application in Debt Recovery Tribunals (DRT) by banks and financial institutions. It means that bank or financial institution or consortium of banks or financial institutions cannot approach DRTs if pecuniary limit amount due is less than Rs 20 lakh. This move is aimed at helping reduce pendency of cases in DRTs.

Background

Banks and financial institutions’ recovery of dues (loans) takes place on ongoing basis through legal mechanisms, which inter-alia includes Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002; Recovery of Debts to Banks and Financial Institution (DRT) Act, 1993 and Lok Adalats. The borrowers of such loans continue to be liable for repayment even when the loans have been removed from the balance sheet of the bank(s) concerned. To make recovery tribunals more effective and to facilitate fast disposal of debt recovery cases, government has made several amendments in different laws, including SARFAESI Act.

Debt Recovery Tribunals (DRT)

DRTs were first set up under Recovery of Debts Due to Banks and Financial Institutions Act 1993, also known as DRT Act. Under it, DRTs were established to facilitate debt recovery involving banks and other financial institutions with their customers. Under existing norms, DRT is supposed to dispose of matter referred to it within 180 days of receipt of application and appeal can be filed against DRT order with Debt Recovery Appellate Tribunals (DRATs). There are 39 DRTs and 5 DRATs functioning at various parts of the country.

Month: Categories: Banking Current Affairs 2018

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ONGC discovers oil, gas reserves in Madhya Pradesh, West Bengal

State-owned Oil and Natural Gas Corp (ONGC) has made oil and gas discoveries in Madhya Pradesh and West Bengal that may potentially open up two new sedimentary basins in country. They are category-III basins, having hydrocarbon and are considered geologically prospective for exploration.

Key Facts

Madhya Pradesh: The gas deposits were discovered in block in Vindhyan basin. This find is at 3,000-plus meters deep and is being now tested. Four wells drilled after discovery and now hydro-frack will be undertaken to test commerciality of this field.

West Bengal: Oil and gas was discovered in well in Ashok Nagar of 24 Parganas district. Around one lakh cubic meters per day of gas has flowed from one object that was tested.

Background

India has 26 sedimentary basins, of which only seven category-I basins have commercial production of oil and gas. Except for Assam shelf, ONGC opened up all the other six basins, including Cambay, Mumbai Offshore, Rajasthan, Krishna Godavari, Cauvery, and Assam-Arakan Fold Belt for commercial production. The seventh basin was opened way back in 1985. It is in the process of adding eighth basin by putting Kutch offshore discovery (it holds about one trillion cubic feet of gas reserves) to production.

26 sedimentary basins (category wise)

Category-I basins: Cambay, Mumbai Offshore, Rajasthan, Krishna Godavari, Cauvery, Assam Shelf and Assam-Arakan Fold Belt. They have been established for commercial production.

Category-II basins: Kutch, Mahanadi-NEC (North East Coast), Andaman-Nicobar, Kerala-Konkan-Lakshadweep. They are known for accumulation of hydrocarbons but no commercial production has been achieved so far.

Category-III basins: Himalayan Foreland Basin, Ganga Basin, Vindhyan basin, Saurashtra Basin, Kerela Konkan Basin, Bengal Basin. They having hydrocarbon and are considered geologically prospective.

Category-IV basins: Karewa, Spiti-Zanskar, Satpura–South Rewa–Damodar, Chhattisgarh, Narmada, Deccan Syneclise, Bhima-Kaladgi, Bastar, Pranhita Godavari and Cuddapah. They have uncertain potential which may be prospective by analogy with similar basins in the world.

Month: Categories: Business & Economy Current Affairs 2018

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