IBC Section 249: Amendments of Act 51 of 1993

Section 249 of Insolvency and Bankruptcy Code, 2016: Amendments of Act 51 of 1993

Official Bare Act Text

Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary

The Recovery of Debts due to Banks and Financial Institutions Act, 1993 shall be amended in the manner specified in the Fifth Schedule.

Legal Commentary & Landmark Judgments: Section 249

Section 249 amends the Recovery of Debts and Bankruptcy Act, 1993 (RDBA) to harmonize DRT proceedings with individual and partnership insolvency under the Code.

Harmonization with DRT Enactment: Amends Act 51 of 1993 in the manner specified in the Fifth Schedule to the Code.
Conferment of Jurisdiction: Aligns the jurisdiction, powers, and procedures of Debt Recovery Tribunals (DRT) with their role as Adjudicating Authority under Part III of the Code.
Coordination of Recovery Decrees: Clarifies the interplay between recovery certificates issued under RDBA and insolvency applications under the Code.

Key Landmark Precedents:

Dena Bank v. C. Shivakumar Reddy (2021) 10 SCC 330: The Supreme Court held that a recovery certificate issued by the DRT under RDBA constitutes a fresh trigger and acknowledgment of debt for initiating CIRP under the Code.
State Bank of India v. V. Ramakrishnan (2018) 17 SCC 394: Affirmed the complementary jurisdictional architecture of DRTs under RDBA and the Code.

Courtroom Practice & Strategic Litigation Guidance:

Financial creditors holding DRT recovery certificates can file an immediate Section 7 petition within three years from the date of the recovery certificate, as settled by the Supreme Court in *Dena Bank*.