CAIIB · Banking Regulations & Business Laws · Module C — Important Acts/Laws & Legal Aspects of Banking Operations, Part B
CAIIB BRBL Unit 18 — The Recovery of Debts and Bankruptcy Act, 1993 (Units 18A–18E): Free MCQs with Explanations
By Swarnakshi Jha (ex-banker) · Updated 29 October 2026 · Paper IV of the December 2026 cycle (Sunday 20 December 2026)
This is the free practice page for CAIIB BRBL Unit 18 — The Recovery of Debts and Bankruptcy Act, 1993 (Units 18A–18E) (Module C — Important Acts/Laws & Legal Aspects of Banking Operations, Part B). The CAIIB Mock Centre holds 200 questions on this unit alone, every one with a why-right / why-wrong explanation; below are the facts examiners keep returning to, five practice questions with explanations, and the traps that cost marks.
BRBL · Module C200 MCQs in the Mock Centre5 free belowPaper on 20 December
Key facts examiners test from this unit
Jurisdiction, powers and authority — from the appointed day only DRTs decide bank claims of ₹20 lakh or more; High Courts keep writ powers, and borrowers' own suits stay with civil courts.
Procedure of Tribunals — file where the account or defendant is; reply in 30 (+15) days; order in 30 days of hearing; appeal in 30 days with 50% (25%).
Recovery and miscellaneous provisions — the Recovery Officer executes the certificate like income-tax arrears; pending suits move to the DRT; the Act overrides other laws but yields to an IBC moratorium.
Changed since the textbook
Income-tax Act, 2025 in force (1 April 2026). The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026; Section 29's references to the 1961 Act's recovery schedules are read with the corresponding new provisions. Source: Income Tax Department press release
Tribunals Reforms Act provisions struck down (19 Nov 2025). The Supreme Court struck down the 2021 Act's four-year tenure, minimum age of 50 and selection-committee provisions; the earlier Madras Bar Association rulings govern until Parliament legislates, and a National Tribunals Commission was to be set up within four months. Source: SC Observer
5 free practice questions — tap an option
Five practice questions from this unit. Answers lock on the first tap, exactly as in the exam, and an explanation opens underneath. The Mock Centre has all 200 questions on this unit, from easy to tough, with caselets and key-in numericals, why every other option is wrong and the exam tip — and tracks your score and revision dates.
Question 1 of 5
Which of these claims can a bank take to the DRT under the RDB Act?
Why (b): The Act covers a 'debt' due to a bank in the course of its business, secured or unsecured and legally recoverable on the date of the application, of ₹20 lakh or more; a claim against a guarantor qualifies. (a) is wrong: ₹15 lakh is below the threshold. (c) is wrong: A time-barred claim is not a debt. (d) is wrong: The DRT hears claims by banks, not suits by borrowers.
Question 2 of 5
Who heads a Debts Recovery Appellate Tribunal?
Why (b): Section 9: a DRAT consists of one person, the Chairperson. (a) is wrong: DRTs have Presiding Officers. (c) is wrong: It is a single member. (d) is wrong: A Registrar is staff.
Question 3 of 5
A bank files a ₹50 lakh recovery suit against a borrower in a civil court. What should the court do?
Why (d): Section 18 bars courts and authorities, other than the Supreme Court and High Courts in their writ jurisdiction, from dealing with debts within the DRT's jurisdiction, so the claim must go to the DRT. Consent cannot confer jurisdiction. (a) is wrong: General jurisdiction yields to Section 18. (b) is wrong: Consent cannot confer jurisdiction. (c) is wrong: High Courts do not hear such claims.
Question 4 of 5
A borrower wants to appeal to the DRAT against a DRT order determining that he owes ₹80 lakh. What must he deposit before the appeal is entertained?
Why (a): Section 21 lets the DRAT entertain the borrower's appeal only if he deposits 50% of the debt determined by the DRT, here ₹40 lakh, though the DRAT may, for reasons recorded, reduce it to not less than 25% (₹20 lakh). (b) is wrong: Only half is required. (c) is wrong: 75% is not the rule, and reduction is allowed. (d) is wrong: The deposit is a condition of appeal.
Question 5 of 5
After a recovery certificate is issued, the Recovery Officer attaches the borrower's property. Where may the borrower appeal against the Recovery Officer's order?
Why (a): Under Section 30, a person aggrieved by an order of the Recovery Officer may appeal to the DRT within 30 days; appeals against the DRT's own orders go to the DRAT. (b) is wrong: The DRAT hears appeals from the DRT. (c) is wrong: The High Court is not the appellate forum. (d) is wrong: Civil courts are barred.
0 of 5 answered.
Traps in this unit
State co-operative banks are outside the Act.
A time-barred claim is not a debt.
A DRT is not a three-member bench.
Practise all 200 questions on Unit 18. The free CAIIB demo opens Units 1–2 of every paper with full explanations; the BRBL Online Mock Centre unlocks all 5,800+ BRBL questions, the full-length papers with caselets and key-ins, module mocks and Smart Revision for 18 months (₹1,499).
Independent study aid — not affiliated with, endorsed by, or sponsored by the Indian Institute of Banking & Finance (IIBF). Exam pattern, dates, fees and passing criteria are set by IIBF — always confirm the current rules at iibf.org.in. CAIIB content follows rules and developments up to IIBF's cut-off of 30 June 2026 (where a rule changed later, the update box says so); verify from official sources before relying on them in practice.