Impleadment in DRT Cases, When and How a Person Can Be Added as a Party
More people than just the borrower and the bank can be affected by a Debt Recovery Tribunal case. Sometimes a guarantor, co borrower, legal heir, mortgagor, subsequent purchaser or another person with an interest in the secured asset will have to be heard. Enter impleadment in DRT cases.
If the bank has started a recovery proceeding and a property that was offered as security is jointly owned, one of the owners may not have been named in the original proceedings. Or perhaps a guarantor learns that recovery proceedings could impact his rights even though the borrower has chosen to fight the dispute. Informally showing up at the Debt Recovery Tribunal might not be enough to have that person heard.
Impleadment is the procedure by which a person requests to become a party to an ongoing proceeding. The Tribunal decides whether that person needs to be joined to fairly decide the dispute.
When clients come to BK Singh Advocate with impleadment requests, we usually don’t start with the question, “Can I be joined?” Instead, we ask “What is your legal interest in the dispute? Would the Tribunal be able to fully adjudicate the dispute without you?”
While Section 18(1) of the Recovery of Debts and Bankruptcy Act, 1993 empowers the Debt Recovery Tribunal with a specialized jurisdiction to handle debt recovery cases, it also allows the Tribunal to frame its own procedure, as long as the principles of natural justice are followed. The procedure for an impleadment application can vary depending on the underlying proceeding, the interest of the applicant, the relief sought and at what stage the case is in.
An application that clearly sets out the reason for why the new party needs to be joined can help the Tribunal see things from your perspective. BK Singh Advocate can review the proceeding, identify the legal interest the person has in the dispute and determine if impleadment, intervention or some other form of relief is suitable.
Why Does Impleadment Matter in DRT Proceedings in 2026?
Impleadment issues can arise where an order will directly affect the rights, liability or interest in property of a person. DRT matters typically include borrowers, guarantors, co borrowers, mortgagors and any other person associated with the underlying security or debt.
The DRT is not obliged to join every individual who may have some interest in a transaction. Normally the party whose addition is sought of would have to demonstrate why their presence is necessary or proper for the effective adjudication of the matter. The general principles governing necessary and proper parties do recognise that the interest of a person may be sufficient enough to warrant their presence if the dispute cannot be completely and effectively decided without that person.
The real practical concern for BK Singh Advocate therefore is connecting the interest of the proposed party directly to the issues before the Tribunal rather than asking for addition because the person happens to be related to the borrower or property.
Quick Facts
Impleadment means making an application for addition as a party to a pending proceeding.
Any person does not have an automatic right to be impleaded only on the ground that he/she is connected to the borrower.
DRT acts under the compliance of governing statute, rules and principles of natural justice.
Section 22 Recovery of Debts and Bankruptcy Act confers procedural powers on DRT which are to be exercised in conformity with the provisions of this Act and rules.
Before making a final order under Section 19(2) of the Act, another bank or financial institution which has a claim against the same person can join in the application for recovery.
A person aggrieved by measures taken under SARFAESI may have an independent remedy under Section 17 of SARFAESI Act, subject to facts of the case.
Order allowing impleadment is not in itself stay order or order granting settlement or protection from possession.
Can a Guarantor or Co Borrower Seek Impleadment?
Guarantor or co borrower is likely to be an necessary party already depending on the manner in which the recovery proceeding has been initiated and against whom relief is sought. However if such an individual has not been impleaded properly then the procedure would need to be analysed.
Guarantor should not assume that just because he has been impleaded, the liability can only be limited or extended. The guarantee documents, loan agreement,security documents and pleadings would continue to play a crucial role.
Similarly co borrower cannot assume that just because another borrower is defending the banks claim he can take a back seat. His individual legal standing in contract would need to be looked at.
BK Singh Advocate can go through the loan documents, guarantee documents and DRT pleadings and then advise upon filing of an application or response.
Can a Property Owner Be Added to a DRT Case?
The property owner person has an interest in where the property itself is the subject matter of the recovery dispute and the person’s rights are affected by the order.
For example, a person having title in or claiming an interest in mortgaged property is certainly entitled to make an application for suitable party status where proceedings relating to recovery measures against that property are pending. However, merely because the title to property is in question, it does not follow that any dispute relating to title is within the ambit of DRT.
Jurisdiction of DRT lies upon the nature of proceeding and relief sought. Title dispute, if independent and complex in itself may have to be considered for another forum or remedy. BK Singh Advocate can evaluate your claim and guide you for filing an impleadment application.
What Documents Are Usually Relevant?
Of course, documents would vary depending on the reason why the proposed party needs to be added. However, a reasonable initial record could be:
- Copy of DRT application / securitisation application
- Summon / notices and interim orders passed
- Loan agreement and sanction documents
- Guarantee / co borrower documents
- Mortgage, title or security documents
- Sale deed/conveyance / ownership documents(if property rights are being dealt with)
- Bank notices and correspondence
- SARFAESI notices (if any)
- Documents that show applicant’s relation with the asset/liability in dispute
- Prior orders passed by court/tribunal on the same dispute.
You don’t need to file everything that you have. BK Singh Advocate will assist you in determining the documents that would actually help prove the legal interest of the proposed party to be added and their necessity in the dispute.
What Happens After an Impleadment Application Is Filed?
The Tribunal deals with the application having regard to the nature of the pending proceeding and the procedure prescribed by statute for that proceeding. The other parties may be given an opportunity to be heard, especially where joining the additional party would expand the scope of the dispute.
The Tribunal may allow or reject the application or make such order on terms as it thinks fit in the circumstances. It would be fact dependent.
The person against whom the application for impleadment is made should also realise that such application would not decide the merits of the underlying dispute. The applicant may still have to prove his substantive rights or defences by way of proper pleadings and evidence.
BK Singh Advocate can help you ensure that the impleadment issue is dealt with separately from the merits of the underlying dispute so that the application doesn’t get converted into an opportunity to litigate issues not properly before the Tribunal.
When Should You Consult a DRT Lawyer?
Legal advice is helpful when you realize that a DRT proceeding involves property, debt or contractual obligation where you have a direct interest, but your name is not on the case.
It also makes sense to seek advice if you've been sent a notice about a secured asset, found out about a recovery proceeding after the fact (say, after you purchased something), inherited property associated with a debt, or are a guarantor and your interests may be impacted.
Don't wait. Practical issues arise. The notices may have already been sent, hearings held, or there may be time limits on separate statutory remedies. BK Singh Advocate can evaluate what stage the proceeding is at and advise what step is available to you next under the law.
How Can BK Singh Advocate Help With DRT Impleadment?
BK Singh Advocate assists clients with DRT and other banking recovery litigation issues including evaluation of impleadment concerns, DRT pleadings review, security document review and representation before appropriate forums.
Know Your Proceeding: The Advocate can start by knowing who has been sued or who has sued. What relief has been sought by the bank or financial institution. Which property/security or guarantor/liability is being addressed. Most importantly why does the party whom you wish to add to the proceeding believe they should be part of the existing suit.
Choose Your Path: Sometimes impleadment is the way to go about and in other cases intervention or a separate SARFAESI proceeding or appeal or some other remedy would be more appropriate.
Another misconception that clients have is that by adding a party everything will automatically come to a halt. Recovery/auction cannot automatically be stayed by adding a party to the litigation. BK Singh Advocate can quickly evaluate if any interim relief is available to you legally and if a separate application would be required.
Frequently Asked Questions
1. What is impleadment in a DRT case?
Impleadment means instituting a suit or application or making an application. The procedure for impleadment typically involves filing a request or application with the Debt Recovery Tribunal (DRT) asking the Tribunal to include another person or entity as a party to the pending DRT proceeding. The Tribunal will then decide if that person should be included based on whether his or her rights or liabilities will be affected by the pending decision.
2. Can a guarantor be impleaded in a DRT proceeding?
The guarantor is usually a party to the proceeding if recovery is sought against him or her. If the guarantor is not already a party, the correct remedy will depend on the facts and documents. Sometimes the guarantor may be impleaded in the DRT proceeding. Other times, it may be necessary to file a separate suit against the guarantor.
3. Can a co borrower seek impleadment?
Similar to question 2 above, depending on whether the co borrower has been joined as a party, he or she may seek to be joined where appropriate. Again, the precise remedy will depend on the facts, pleadings, and whether recovery is sought against the co borrower.
4. Can a property owner be impleaded before the DRT?
The property owner maybe be able to seek impleadment depending on his interest in the property which is being disputed before the DRT. The property owner is not always a necessary party just because he or she owns the property.
5. Does impleadment stop bank auction?
No. The mere filing of an impleadment application (or permitting such request to be filed) does not itself stop the bank from proceeding with auction or taking possession under the applicable law. A separate request for temporary relief would need to be filed. Please refer to Questions 5 & 6 of FAQ’s on Stay of Bank Auction.
6. Can a legal heir seek impleadment?
Yes, if the proper party died after the commencement of the proceeding his legal heir may need to be impleaded. Depending on when the death occurred, different procedures would apply. BK Singh Advocate can provide advice specific to your situation.
7. Is Order I Rule 10 CPC applicable to every DRT case?
Not exactly. Since the Debt Recovery Tribunal “shall not be bound by the procedure laid down in the Code of Civil Procedure, 1908.” Section 22 RDB Act Instead, that section states that the Tribunal “shall proceed in such manner as is just and fair and shall, while exercising its jurisdiction, be guided by the principles of natural justice,”
8. What is a necessary party before the DRT?
A necessary party is a person who should ideally be made a party to a dispute in order for the Tribunal to pass an effective order. However, just because a person is technically not joined as a party, it does not mean the DRT cannot make an order regarding the relief claimed by the other parties. If there is a dispute before the DRT, whether a person is necessary party will depend on the facts and the relief sought.
9. What is a proper party?
A proper party is a person who should be made a party to the dispute. A proper party is not necessarily a necessary party. The distinction is that the Tribunal can make a complete order without joining a proper party, whereas the Tribunal may not be able to effectively dispose of a necessary party.
10. Can auction purchaser be impleaded before DRT?
The purchasers rights, if any would need to be analyzed along with the stage of the dispute to determine if joining the purchaser as a party in the DRT is even possible. In many cases impleadment of an auction purchaser is not warranted. Whether impleadment of the auction purchaser is advisable would need to be seen based on the facts.
11. Can a mortgagor seek impleadment?
In some cases where there is a mortgage of property, the mortgagor may have rights that should be considered by the DRT before making an order. It cannot be said that a mortgagor should always be impleaded before the DRT without knowing the details of the case.
12. Can other bank join DRT proceeding?
Yes. Section 19 of the RDB Act allows another bank/financial institution having any claim against the person liable to pay the debt to join the applicant bank/financial institution under certain conditions before the Tribunal passes a final order.
13. Is a separate application required for impleadment?
Typically, yes. A third person who desires to become a party to the proceeding must make an application or request to the Tribunal. That application can be made through different mechanisms depending on the facts and the stage of the proceeding.
14. What supporting documents are required for impleadment?
There is no definite list of documents required to support an impleadment request. Some documents that may be considered include: copies of DRT pleadings and notices, loan documentation, guarantee documents, title documents showing the applicants interest, mortgage/deed of pledge, etc.
15. Can impleadment be requested at a later stage?
Yes, although the same request made at the beginning of the proceeding may be allowed after the proceeding is underway. The law regarding impleadment does not prohibit making the request later, but the Tribunal has discretion to deny the request if it deems it appropriate (for example where there has been an unnecessary delay).
16. If impleaded before DRT, does the applicant wins the case?
No. Impleadment allows a person to become a party to the dispute. However, whether the applicant is entitled to any relief from the Tribunal will depend on the facts. Just because the applicant is impleaded does not mean that the Tribunal will grant him the relief that he claims.
17. Can any person affected by SARFAESI action approach DRT?
Yes. Section 17 SARFAESI Act provides a remedy before the Tribunal for any person who feels aggrieved by certain actions taken by the bank/financial institution under Section 13(4) of the SARFAESI Act. If you have been affected by such action, BK Singh Advocate can help you determine whether you have a remedy before the Tribunal.
18. Can impleadment be misused to delay proceedings?
Impl Healment is meant to allow persons who have a legal interest in the matter before the Tribunal to become parties to that proceeding. It should not be used as tool to unnecessarily delay or frustrate the recovery process by banks and financial institutions. Any impleadment application would be considered by the Tribunal which can refuse the request if it is not satisfied.
19. Can impleadment application be handled by DRT lawyer?
Yes. DRT lawyers, like BK Singh Advocate who specialize in banking law can assist you in determining if you have the legal right to be impleaded. If so, then the lawyer can file the application on your behalf and represent you before the Tribunal.
20. Why consult BK Singh Advocate about DRT impleadment.
BK Singh Advocate can assist you in determining if you should apply for impleadment before the DRT or if there is another remedy available. BK Singh Advocate can also tell you what documents would be required to support your application. Further, because BK Singh Advocate practices regularly before the DRT, you will benefit from having your case reviewed as soon as possible to see if any procedural deficiencies can be corrected.
Conclusion
Invoking Impleadment is not about attaching another name in a DRT case. The question is whether the person/ party whom you seek to implead has a legitimate enough legal interest for the Tribunal to believe that his presence is required or necessary to adjudicate upon the dispute.
Don’t let borrowers, guarantors, co borrowers, proprietors, legal heirs or other interested parties tell you that there is only one procedure for every DRT case. Review your case file, pinpoint the legal interest and BK Singh Advocate will help you understand your options in simple terms.
If your debt, guarantee, property or any other legal interest can be affected by a DRT proceeding, an evaluation at the earliest stage is often more beneficial than at a later stage when the matter has reached a critical point. BK Singh Advocate may help you with DRT legal consulting and representation in Delhi NCR and other cities in India as per local jurisdictions and the facts of the case.
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