The High Court of Madhya Pradesh has held that a Debt Recovery Tribunal (DRT) lacks jurisdiction to restrict a person’s right to travel abroad or impose conditional terms on such travel. The ruling emerged from a petition filed by an ex-director of a company, challenging an order by the Tribunal’s Recovery Officer dated 22 August 2025, which had permitted foreign travel only subject to deposit of ₹50,00,00,000 as security for the bank to whom debts were owed.
The petitioner’s background reveals that he had acted as co-guarantor for a loan taken by a company, which later defaulted and was declared a non-performing asset. On that basis, the bank invoked the recovery provisions under Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (RDB Act). Subsequently, the DRT issued a recovery certificate in favour of the bank. The petitioner, having received a job offer from abroad, sought permission to travel overseas. The bank opposed the request, citing the possibility that the petitioner might abscond.
The DRT conditionally allowed the travel, demanding the large sum as a surety deposit. The High Court intervened, observing that neither the RDB Act nor any state law confers on the DRT the power to deprive a person of the right to travel abroad. According to the Court, the restriction or imposition of conditions on foreign travel effectively deprives an individual of their fundamental right to go abroad and return — a right protected under the Constitution. The Court thus found that the DRT’s order was “unsustainable” and struck down the contested condition.
In reaching this conclusion, the Court echoed earlier jurisprudence, including rulings by other High Courts such as the Bombay High Court, which in a similar context had held that a DRT/Tribunal has no statutory or implied power to restrain a debtor’s foreign travel or impound their passport. The reasoning of those courts pointed out that sections of the RDB Act — including those empowering the Tribunal to pass orders necessary for recovery or to prevent abuse of process — do not extend to restricting a person’s liberty to travel abroad.
The Madhya Pradesh High Court, following this line of authority, reinforced that a citizen’s right to travel internationally is a core component of personal liberty under constitutional law. As there is no relevant statutory provision authorizing a Restriction on travel abroad in a debt-recovery context, the DRT’s attempt to regulate or control this right was invalid.
Consequently, the Court allowed the petition and quashed the condition imposed by the Recovery Officer. The judgment reaffirms that while debt recovery tribunals have specified statutory powers to adjudicate and enforce financial claims, they cannot intrude into fundamental personal liberties such as the right to travel abroad, unless expressly empowered by law.
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