Artha Rin Ain 2003: Special Legislation for Financial Institutions' Debt Recovery
Artha Rin Ain 2003 is a special legislation aimed at enhancing the recovery process of outstanding debts of financial institutions in Bangladesh. The law addresses the shortcomings of previous acts and establishes dedicated courts for the swift resolution of cases involving unpaid claims. It encompasses various types of loans and financial arrangements, ensuring that institutions can efficiently realize their dues. Through the establishment of Artha Rin Adalats, the act ensures exclusive jurisdiction for financial institutions' debt recovery cases, providing a focused and expedited legal remedy.
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THE ARTHA RIN AIN, 2003 Generally money suit is filed before the civil courts in order to realize outstanding demand. But these general provisions of law proved to be inadequate in many respects. Especially the financial institutions were suffered a lot for want of effective and speedy machinery to realize their unpaid claim. In consequence thereof the economic flow of the country was going to be paralyzed.
Being realized these facts; a special legislation was at first promulgated in the name of Artha Rin Adalat Ordinance, 1989 and Subsequently the said ordinance replaced with the enactment of Artha Rin Ain of 1990 for realization of outstanding demand of financial institutions. But in course of time that very act seemed to be again inadequate to face various new problems during the trial and execution proceedings. Thus, with a view to make the said act more amended and consolidated, the Arhta Rin Adalat Ain, 2003 has been enacted for recovery of dues by financial institution
The kind of loan which can be recovered: The following kind of loans can be recovered under this act as defined in section 2 of the act: Advance, credit, cash credit, overdraft, bank credit, discounted or purchased bill, investment made by the financial institutions regulated in accordance with islamic sharia or any other financial favour or facilities described in whatever name, Guarantee, indemnity, letter of credit or any other financial arrangement, which any financial institution grants or issues in favour of the borrower or accepts as liability.
Loan granted by financial institutions to any of its officer or servants. Legally imposed any interest, penalty interest or profit or lease upon the above-mentioned debt or in some cases investment made by the financial institutions regulated in accordance with islamic sharia.
SPECIAL REORGANIZED COURT ESTABLISHED UNDER THIS ACT: Sections 4 & 5 of the act provide for the provisions of establishment of distinct artha rin adalat. This court shall have exclusive jurisdiction to try the suits filed by the financial institutions for realization of debt. This court has been excluded from exercising any other civil or criminal jurisdiction.
JURISDICTION OF THE ARTHA RIN ADALAT: All suits relating to the realization of loan of a financial institution including mortgage suit for foreclosure and sale and even public demand of more than tk. 50,000.00 (taka fifty thousand) are exclusively triable by the artha rin adalat. A financial institution cannot file a mamla before the adalat accusing its employees for misappropriation of money labeled it as debt. A borrower is not entitled to file any mamla before this adalat against any financial institution though the cause of action may arise from DEBT.
Irrespective of public demand recovery act (PDRA) 1913, if the loan is recoverable under ARAA then it has to be recovered using the artha rin adalat no matter whether this loan is considered as public/government loan [section 5(5) of ARAA]. However, cases involving claims by bangladesh krishi bank and bangladesh krishi unnoyon bank and other state-owned financial institutions not exceeding the amount of taka 5 lacs can be filed as certificate case using the PDRA 1913 instead of filing in artha rin adalat [section 5(5) of ARAA]. If there are special provisions for recovering loan by financial institutions established by special law, then the ARAA provisions will be counted as additional to those provisions. However, if that financial provision files a case in artha rin adalat for recovering loans, then the ARAA will be applicable [section 5(6) of ARAA]
LOANS GIVEN TO THE GOVERNMENT BY THE FOLLOWING INSTITUTIONS [SECTION 2KA (12- 17)] ARE NOT RECOVERABLE BY THE ARTHA RIN ADALAT: INTERNATIONAL FINANCE CORPORATION COMMONWEALTH DEVELOPMENT CORPORATION ISLAMIC DEVELOPMENT BANK ASIAN DEVELOPMENT BANK INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION
However, appropriation of money by the officers or employees of a financial institution can not be entertained with this act (section 18(1) of ARAA). Mortgage suit for sale or foreclosure of immovable property in pursuant to section 67 of the transfer of property act 1882 and order XXXIV of CPC has to be filed in the artha rin adalat and the procedures laid down in CPC and ARAA have to followed in combination, so far as it is possible [section 5(2) of ARAA]
The loan-receiver cannot file a case against the financial institutions under this statute. Neither he can counterclaim or put any claim of set off against the financial institution while filing the written statement (section 18(2) of ARAA). Any case pending in any other court by the loan receiver being plaintiff cannot be heard analogously with the case filed by the financial institution against that loan receiver in artha rin adalat and vice versa. Neither it is possible to stay the case under artha rin adalat on that ground (section 18(3) of ARAA).
