SARFAESI · Limitation · August 2026
Can the DRT Condone Delay Under Section 17? —
An Open Question, and a Closed Route
A borrower challenging enforcement must move the Debts Recovery Tribunal within forty-five days. What happens when that period is missed is unsettled — and the route most commentary cites for rescuing a late application is one the Supreme Court has already closed. This piece separates the argument that cannot work from the one that might, and sets out how a delayed application should actually be pleaded.
Table of Contents
The Forty-Five Days, and the Date They Run From
Section 17(1) of the SARFAESI Act, 2002 allows any person aggrieved by a measure taken under Section 13(4) to apply to the Debts Recovery Tribunal “within forty-five days from the date on which such measure had been taken”. The period runs from the measure — not from knowledge, not from receipt of any communication, and not from the Section 13(2) demand notice.
Two errors recur. The first is filing too early. The Explanation to Section 17(1) is categorical: the secured creditor's communication of its reasons for rejecting a representation under Section 13(3A), or an indication of its likely action at that stage, “shall not entitle the person (including borrower) to make an application to the Debts Recovery Tribunal under this sub-section”. Neither the demand notice nor the fifteen-day reasoned reply is a measure under Section 13(4).
The second is filing too late, on an assumption that the clock starts when the bailiff arrives. In M/s Hindon Forge Pvt. Ltd. v. State of Uttar Pradesh, (2019) 2 SCC 198, the Supreme Court declared “that the borrower/debtor can approach the Debts Recovery Tribunal under section 17 of the Act at the stage of the possession notice referred to in rule 8(1) and 8(2) of the 2002 Rules”. Constructive possession is a measure. The declaration is enabling rather than limitational, but it carries the consequence — to be worked out on the facts of each case — that a borrower who waits for physical dispossession may find that time has been running.
Our SARFAESI time-limits calculator sets out every statutory period in the Act with the enacted wording against each, and computes the date each deadline falls.
The Route That Does Not Work — Section 24 RDB Act
Section 17 contains no proviso empowering the Tribunal to condone delay. The argument usually advanced to supply one is incorporative: Section 17(7) directs the Tribunal to dispose of the application in accordance with the Recovery of Debts and Bankruptcy Act, 1993, and Section 24 of that Act applies the Limitation Act, 1963 “as far as may be… to an application made to a Tribunal”. If the Limitation Act applies, so does Section 5, and delay becomes condonable on sufficient cause.
The difficulty is that “application” is a defined term. Section 2(b) of the 1993 Act means by it “an application made to a Tribunal under section 19” — an original recovery application by a bank or financial institution. A Section 17 securitisation application does not originate under Section 19.
The Supreme Court has said so. In International Asset Reconstruction Company of India Ltd. v. Official Liquidator of Aldrich Pharmaceuticals Ltd., Civil Appeal No. 16962 of 2017, decided on 24 October 2017, a three-judge Bench held at paragraph 14 that “the Legislature has provided for application of the Limitation Act to original proceedings before the Tribunal under Section 19 only”, and that “Section 24 is limited in its application to proceedings before the Tribunal originating under Section 19 only”. The same paragraph rejects reaching Section 5 by way of Section 29(2) of the Limitation Act.
That case concerned an appeal under Section 30 of the 1993 Act, not a Section 17 application, and the Court was not asked about SARFAESI. So the holding does not decide the point — but its reasoning is about how far Section 24 reaches, and it tells strongly against the Section 24 route. High Courts have nonetheless continued to reason through Section 17(7) to Section 24, in both directions. Counsel relying on Section 24 should therefore expect to meet International Asset Reconstruction across the table, and should be ready to distinguish it rather than ignore it.
What Baleshwar Dayal Actually Decided
Baleshwar Dayal Jaiswal v. Bank of India, (2016) 1 SCC 444 is routinely cited for the proposition that delay under the SARFAESI Act is condonable, and almost as routinely misdescribed as having proceeded under Section 24. It did not.
The case concerned Section 18, which governs appeals to the Appellate Tribunal and likewise carries no express condonation clause. The Court reasoned that “the absence of an express provision for condonation, when Section 18(2) expressly adopts and incorporates the provisions of the RDB Act which contains provision for condonation of delay in filing of an appeal, cannot be read as excluding the power of condonation”, and answered the reference by holding that delay under Section 18(1) “can be condoned by the Appellate Tribunal under proviso to Section 20(3) of the RDB Act read with Section 18(2) of the SARFAESI Act”.
That is incorporative reasoning of a different and narrower kind. It works because Section 18(2) adopts a specific appellate provision which itself contains a condonation proviso. Section 17 has no equivalent adopting sub-section, and Section 20(3) is an appellate provision. Whether the reasoning travels from the appellate stage to the original application is the whole of the dispute.
Where the Question Stands
The Kerala High Court has held that a Tribunal cannot entertain a time-barred Section 17 application, on the orthodox ground that where a statute makes no provision for enlarging time, no court — not even a High Court — may extend it. Other High Courts have taken the contrary view, applying Baleshwar Dayal by analogy on the footing that Sections 17 and 18 are similarly worded.
That divergence reached the Supreme Court in 2021 in K.J. George v. Authorised Officer, Indian Bank, an appeal from the Kerala view, in which a Bench of Khanwilkar and Dinesh Maheshwari JJ issued notice on precisely this question. It has not since been resolved.
Two consequences follow. The first is jurisdictional: whether the remedy survives for a late applicant depends on which High Court's writ runs — an uncomfortable position for a statute whose object was uniform and expeditious enforcement. The second is that a practitioner cannot treat the point as settled in either direction, and should not draft as though it were.
Drafting a Delayed Section 17 Application
The practical consequence is not ambiguity but discipline.
File within forty-five days, and never plan on condonation. In a jurisdiction that follows the Kerala line there may be no power to rescue the application at all. Treating the forty-five days as soft is the single most avoidable way to forfeit the remedy.
Where delay has already occurred, plead the condonation application in the alternative — separately and properly, not as a paragraph inside the main application. Source it to the incorporative reasoning in Baleshwar Dayal, and not to Section 24. Set out sufficient cause on affidavit as though the power is discretionary and contested, because it is.
Do not let the condonation question displace the merits. The application must stand on the illegality of the measure. A strong case on merits is what persuades a Tribunal to find the power it has been invited to exercise.
Related reading: Section 17 SARFAESI vs Article 226 writ — choosing the forum, and the DRT, DRAT and SARFAESI fee calculator for what the application costs to file.
Key Takeaways
- Section 17 contains no condonation proviso. Whether the power exists at all is unresolved.
- The Section 24 RDB Act route is contested, not safe — International Asset Reconstruction (2017), para 14, confines Section 24 to proceedings originating under Section 19, and Section 2(b) defines “application” accordingly. That case was about Section 30, so it does not decide Section 17, but it is the obstacle any Section 24 argument must clear.
- Baleshwar Dayal proceeded under the proviso to Section 20(3) read with Section 18(2), at the appellate stage — not under Section 24.
- The High Courts are split; the Supreme Court issued notice in K.J. George in 2021 and the question is still open.
- The forty-five days run from the measure, and Hindon Forge holds the door opens at the rule 8(1) and 8(2) possession notice.
- There is no pre-deposit at the Section 17 stage; it arises only on a Section 18 appeal.
Frequently Asked Questions
Can the DRT condone delay in filing a Section 17 SARFAESI application?
It is an open question. Section 17 of the SARFAESI Act, 2002 contains no proviso empowering the Debts Recovery Tribunal to entertain a late application, unlike Section 20(3) of the RDB Act, 1993, which carries an express condonation proviso for appeals. The High Courts are divided. The Kerala High Court has held that a Tribunal cannot entertain a time-barred Section 17 application, on the ground that where a statute makes no provision for enlarging time no court may extend it. Other High Courts have applied Baleshwar Dayal Jaiswal by analogy, reasoning that Sections 17 and 18 are similarly worded. The Supreme Court issued notice on precisely this question in K.J. George v. Authorised Officer, Indian Bank in 2021 and it has not since been resolved.
Does Section 24 of the RDB Act give the DRT power to condone delay under Section 17?
It is the most commonly cited route, and it is not a safe one. The argument runs that Section 17(7) SARFAESI directs the Tribunal to dispose of the application in accordance with the RDB Act, and that Section 24 of that Act applies the Limitation Act, 1963 to "an application made to a Tribunal". The obstacle is that "application" is a defined term: Section 2(b) of the RDB Act means by it "an application made to a Tribunal under section 19". A Section 17 securitisation application does not originate under Section 19. In International Asset Reconstruction Company of India Ltd. v. Official Liquidator of Aldrich Pharmaceuticals Ltd., Civil Appeal No. 16962 of 2017, decided 24 October 2017, a three-judge Bench held at paragraph 14 that "Section 24 is limited in its application to proceedings before the Tribunal originating under Section 19 only". That case concerned an appeal under Section 30, so it does not decide the SARFAESI question, and High Courts have continued to reason through Section 17(7) in both directions. But it is the authority any Section 24 argument has to meet.
What did Baleshwar Dayal Jaiswal actually decide?
Baleshwar Dayal Jaiswal v. Bank of India, (2016) 1 SCC 444 concerned delay in a Section 18 appeal to the DRAT, not a Section 17 application. Section 18 likewise carries no express condonation clause. The Supreme Court held that "the absence of an express provision for condonation, when Section 18(2) expressly adopts and incorporates the provisions of the RDB Act which contains provision for condonation of delay in filing of an appeal, cannot be read as excluding the power of condonation", and located the power in the proviso to Section 20(3) of the RDB Act read with Section 18(2) of the SARFAESI Act. It is frequently but wrongly described as having proceeded under Section 24. It did not.
From what date do the forty-five days under Section 17 run?
Section 17(1) allows the application to be made "within forty-five days from the date on which such measure had been taken" — that is, from the date of the measure under Section 13(4), not from the Section 13(2) demand notice, not from the Section 13(3A) reply, and not from the date the borrower learned of the measure. In M/s Hindon Forge Pvt. Ltd. v. State of Uttar Pradesh, (2019) 2 SCC 198, the Supreme Court declared that a borrower may approach the DRT at the stage of the possession notice under rules 8(1) and 8(2) of the 2002 Rules, constructive possession being a measure. A borrower who waits for physical dispossession may therefore find that time has been running.
How should a delayed Section 17 application be drafted?
File within forty-five days and never plan on condonation — in a jurisdiction following the Kerala line there may be no power to rescue the application at all. Where delay has already occurred, carry a separate, properly pleaded condonation application in the alternative to the case on merits; source it to the incorporative reasoning in Baleshwar Dayal rather than to Section 24; and set out sufficient cause on affidavit as though the power is discretionary and contested, because it is.
Is there a pre-deposit for a Section 17 application?
No. There is no pre-deposit at the Section 17 stage before the DRT. The erstwhile requirement that a borrower deposit seventy-five per cent of the amount claimed was struck down by the Supreme Court in Mardia Chemicals Ltd. v. Union of India, (2004) 4 SCC 311. A pre-deposit arises only at the appellate stage under Section 18 — fifty per cent of the debt due, which the DRAT may reduce to not less than twenty-five per cent for reasons recorded in writing.
If a Section 17 period has run or is about to, the remedies that remain narrow quickly. Our team advises borrowers, promoters and guarantors on SARFAESI and DRT proceedings.
This article is general commentary on the statutory position and is not legal advice. Readers should take advice on their own facts. Primary sources: SARFAESI Act, 2002 and the Recovery of Debts and Bankruptcy Act, 1993 as published by India Code; International Asset Reconstruction Company of India Ltd. v. Official Liquidator of Aldrich Pharmaceuticals Ltd., C.A. No. 16962 of 2017; Baleshwar Dayal Jaiswal v. Bank of India, (2016) 1 SCC 444; M/s Hindon Forge Pvt. Ltd. v. State of Uttar Pradesh, (2019) 2 SCC 198; Mardia Chemicals Ltd. v. Union of India, (2004) 4 SCC 311.