Chapter IV PROCEDURE FOR SETTLEMENT OF DEBTS

The State Government may, by notification in the Official Gazette, establish for any area specified therein a Tribunal consisting of a sole member who shall be a revenue officer not below the rank of Circle Officer having jurisdiction over that area.

1. (1) A debtor or his creditor may make an application for the settlement of his debts to the Tribunal established for an area in which he ordinarily resides, within such time as may be prescribed by the Government.
2. (2) Every application made under sub-section (1) shall be in writing in the prescribed form and shall be signed and verified in the prescribed manner.
3. (3) Every such application shall contain the following particulars namely—
   • (a) the name and address of the applicant;
   • (b) the amount and particulars of all debts with the name and address of the creditor or debtors, as the case may be;
   • (c) the particulars of debtor‟s properties both movable and immovable with estimated present marked value thereof, and of any pledge, hypothecation, mortgage, lien or charge as security subsisting thereon in the case of an application from a debtor, and particulars of debtor‟s such properties both movable and immovable as pledged, hypothecated or mortgaged to the creditor in the case of application from the creditor;
   • (d) the particulars of the documents evidencing or proving the existence of the debt enumerated in the application;
   • (e) the number and year of the suit or proceeding with the name of the Civil Court, if such suit or proceeding is pending before that Civil Court in respect of debts enumerated in the application.

No

application shall lie under Section 6 for settlement of any debt due from a debtor to whom such debt has been transferred or assigned by any person who is not himself a debtor.

1. (1) If any debtor and any or all of his creditors, before the making of any application under Section 6 arrive at a settlement in respect of any debt due by the debtor to. the creditor, the debtor or any of the creditors may within thirty days from the date of such settlement make an application to the Tribunal for recording such settlement.
2. (2) Every such application shall be in the prescribed form and shall be signed and verified in the prescribed manner.
3. (3) On receipt of such application the Tribunal shall, after giving notice to the creditor, or the debtor, as the case may be, and after making such equity as it thinks fit, if it is satisfied that the settlement arrived at is bona fide and voluntary and is not made with intent to defeat or delay any of the creditors of the debtor, and is in the interest of the debtor, record such settlement and certify the same. Every such settlement so recorded and certified shall be binding upon the parties thereto and shall not be reopened.
4. (4) After the Tribunal has recorded and certified a settlement under sub-section (3), the Tribunal shall call upon the debtor to make a declaration whether there are any other debts due by the debtor which are not included in the settlement. If the debtor makes a declaration that there are no such debts the Tribunal shall pass orders in terms of such settlement.
5. (3) If the Tribunal is satisfied, after recording such settlement, that there are other debts, due from the debtor which are not included in the settlement, the Tribunal shall treat the application made under sub-section (1) as an application for settlement of debts under Section 6.

Notwithstanding anything contained in the preceding sections, if during the pendency of proceedings before the Tribunal or the Appellate Authority, as the case may be, a settlement is arrived at between a debtor and all his creditors and if the Tribunal or the Appellate Authority, as the case may be, is satisfied that the settlement has been made by the debtor voluntarily and is for his benefit, such Tribunal or Appellate Authority, as the case may be, may pass orders in terms of such settlement.

Where two or more applications for settlement of debts under Section 6 are presented by or against the same debtor, all such applications shall be consolidated. Where such separate applications are presented by or against joint debtors, all such applications shall be heard together.

On receipt of the application under Section 6, the Tribunal shall—

1. (a) give notice to the debtor (unless the debtor is himself an applicant) and to every creditor (other than the creditor who is himself an applicant) whose name and address are given in the application, and
2. (b) cause the copies of the notice to be affixed on the notice board of the offices of Tribunal, Tahsildar and Gram Panchayat having jurisdiction over the respective areas in which the debtor and each of the creditors ordinarily reside; requiring the debtor and all creditors to submit a statement in the prescribed form which one month from the date of the service of the notice or affixation of the notice on the Notice board whichever is later : Provided that in the Tribunal is satisfied that the debtor or the Creditor is for good and sufficient cause unable to comply with the notice within the time specified therein, it may extend the period for the submission of the statement.

Every debt due from debtor in respect of which no application has been made under Section 6 within the time prescribed under the said Section 6 or in respect of which no application for recording a settlement is made under Section 8 within the period specified in the said Section 8 and every debt due from such debtor in respect of which a statement is not submitted to the Tribunal by the creditor in compliance with the provisions of Section 11, shall be extinguished.

1. (1) Every debtor by or against whom an application is made under Section 6 or who is a party to an application made under Section 8 shall produce all documents including books of accounts, submit to such examination in respect of. his property and his creditors, and attend to such time before the Tribunal as may be required by the ^Tribunal.
2. (2) It shall be the duty of every creditor to produce such documents including the books of accounts, to submit to such examination and to supply such information in respect of the debt due to him by the debtor and the securities held by him as may be required by the Tribunal.

1. (1) The Tribunal shall fix the date for hearing of the application under Section 6 on the date so fixed, shall call upon the applicant and all his creditors or debtors, as the case may be, to explain their respective cases regarding each debt and shall use its best endeavour to induce them to arrive at an amicable settlement, and if such settlement is arrived at, the Tribunal may pass orders in terms of such settlement.
2. (2) If there is a dispute as to the existence or the amount of the debt, the Tribunal may decide the dispute and determine its amount after taking such evidence as it considers necessary : Provided that a decree of Civil Court relating to a debt shall be conclusive evidence as to the existence and amount of debt.

1. (1) In making settlement of debts by the Tribunal, no creditor shall be allowed a greater amount in satisfaction of both the principal and interest of a debt twice the amount of the principal and accordingly—
   • (i) if in the course of proceedings before the Tribunal it is found that any of the creditors has received from his debtor twice or more than twice the amount of the principal in cash or in kind, the Tribunal shall pass the orders that the debt shall be deemed to have been fully discharged and shall declare that the debtor shall from the date of the order, be in lawful possession of the property secured for the debt that is deemed to have been discharged;
   • (ii) if, in the course of such proceedings, it is found that with respect to any debt, the amount received in cash or in kind by the creditors is less than twice the amount of the principal, the Tribunal shall pass orders that only such amount as together with the amount already so received, will be equal to twice the amount of the principal, shall be repayable with respect to such debt. Illustrations
2. (1) A has borrowed a sum of Rs. 100 which with interest has accumulated to Rs. 150. If A has repaid Rs. 120 he is liable to repay only Rs. 30.
3. (2) A has borrowed a sum of Rs. 100 which with interest has accumulated to Rs. 250 and accordingly—
   • (a) if A has repaid Rs. 200 or more his debt stands redeemed.
   • (b) if A has repaid Rs. 160 he is liable to repay only Rs. 40 for redemption.
4. (2) No creditor shall be allowed a higher rate of interest than the agreed rate of interest or the rate of interest as may be fixed by the State Government under Section 25 of the Bombay Money Lenders Act, 1946, as extended to the State of Tripura, whichever is less.

Any person aggrieved by any order of the Tribunal under sub-Ss. (3) and

1. (4) of Section 8 and Section 9,14 or 15, may within thirty days from the date of the order, appeal to the District Collector : Provided that no appeal shall lie against any order of the Tribunal if the amount of the claim is less than rupees one thousand or such other sum as may be specified in that behalf by the State Government by a notification in the Official Gazette.
2. (2) Subject to the provisions of Section 17 the decision of the Tribunal where no appeal is filed and the decision of the District Collector where an appeal is filed, shall be final and shall not be questioned in any court of law.

The Revenue Commissioner may within three months from the date of the order passed under this Act either suo moto or on application, call for and examine the record of any proceeding relating to such order for the purpose of satisfying himself as to the legality of property of the order and may pass such order thereon as he thinks fit.

Every settlement of a debt due from a debtor to any creditor, which is not certified by the Tribunal under sub-section (3) of Section 8 or in respect of the settlement of which no order has been passed under sub-section (4) of Section 8, Section 9, 14 or 15 shall be void and shall not be recognised by any Civil court for any purpose whatsoever,