Mr. Mehta, the appellant says the DRT is a substitute for the civil court. If a civil court decree can support an insolvency notice, why can't a DRT recovery certificate?

My Lord, the DRT is not a substitute for the civil court; it is a specialised tribunal with limited jurisdiction. The definition of 'decree' under the CPC is clear: it is a formal expression of adjudication by a court. The DRT is not a court. The legislature, when it created the DRT, did not equate its recovery certificates with decrees. The 2016 amendment was required to do precisely that. The fact that Parliament felt the need to amend the law in 2016 shows that the law was otherwise. The appellant cannot rely on a subsequent amendment to support a pre-amendment certificate. The law must be applied as it stood on the date of issuance of the certificate.

But the omission of the phrase 'of any court' in Section 9(2) is significant. Why would Parliament omit that phrase if it intended to restrict the meaning to court decrees?

My Lord, the omission is not significant. The phrase 'decree or order' has a well-understood meaning in law, derived from the CPC. Parliament is presumed to know the law. The omission of 'of any court' does not change the fundamental meaning of 'decree' or 'order'. Moreover, the Insolvency Act must be strictly construed. If Parliament intended to include orders of tribunals, it would have said so expressly. It did not. The 1978 amendment did not change the meaning of 'decree' or 'order'. It merely introduced the insolvency notice procedure. The meaning of 'decree or order' remains the same as it was in 1909.

What about the 2016 amendment? It deems a recovery certificate to be a decree or order for insolvency proceedings. Does that not apply to this case?

My Lord, the amendment is prospective. It was inserted in 2016 and cannot be applied to a recovery certificate issued in 2004. The rights of the parties crystallise on the date of institution of proceedings. This Court in Rameshwar v. Jot Ram and Beg Raj Singh v. State of U.P. has held that later developments cannot defeat a right that existed on the date of institution, nor can they create a right that did not exist. The appellant's claim was untenable on the date it filed the application before the DRT and on the date the recovery certificate was issued. It cannot become tenable because of a subsequent amendment. The amendment is a legislative recognition that such a right did not exist earlier.

The appellant says even if the amendment is prospective, the Court can declare the law as it always was. Can the Court do that?

My Lord, the Court cannot declare a law that is contrary to the statutory scheme. The legislature has explicitly and knowingly inserted the 2016 amendment. This indicates that the legislature understood the law to be otherwise. The Court cannot usurp the legislative function and declare that the amendment was clarificatory when the legislature itself treated it as a new provision. The amendment is a substantive change, and it must be applied prospectively. The appellant cannot benefit from it.

For RespondentCommercial Premium

Recovery Certificate Is Not a Decree or Order — (2026) INSC 688

A recovery certificate issued by the DRT is not a 'decree or order' under Section 9(2) of the Insolvency Act. The term 'decree or order' refers only to decrees and orders of civil courts.

H.D.F.C. Bank Limited v. Kishore K. Mehta (Dead) Through L.Rs. — (2026) INSC 688

Core Argument

A recovery certificate issued by the DRT is not a 'decree or order' under Section 9(2) of the Insolvency Act. The term 'decree or order' refers only to decrees and orders of civil courts. The 2016 amendment to the RDB Act is prospective and does not apply to pre-2016 certificates. The Insolvency Act must be strictly construed.

Key Precedents

Paramjeet Singh Patheja v. ICDS Ltd. (2006) 13 SCC 322 — Held that an arbitral award is not a 'decree or order' under Section 9(2) of the Insolvency Act; the same reasoning applies to DRT recovery certificates.
Rameshwar v. Jot Ram AIR 1976 SC 49 — Held that the right to relief must be judged on the date of institution of proceedings.

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