Broad definition of debt covers fraudulent banking liabilities, supporting repayment claims with interest and recovery proceedings.

A claim based on fraudulently obtained and unauthorized Letters of Undertaking was treated as a legally recoverable debt because the expression "debt" under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 was read broadly to include liabilities arising from fraudulent banking transactions. Written communications and balance-sheet entries were treated as admissions, so proof was dispensed with under the Evidence Act, and secondary evidence was accepted where permitted. The fraud pleading was found sufficiently particularised under the Code of Civil Procedure. On that basis, the beneficiaries of the unauthorized credit facilities were held liable to repay the bank with interest, and the matter was treated as maintainable before the Tribunal.

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Issues: Whether the claim arising from unauthorized Letters of Undertaking constituted a legally recoverable debt within the Tribunal's jurisdiction, and whether the applicant bank was entitled to recovery with interest and ancillary reliefs.

Analysis: The claim was founded on fraudulently obtained and unauthorized Letters of Undertaking issued in the course of the bank's business activity. The Tribunal held that the expression "debt" under Section 2(g) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is of wide amplitude and includes a liability arising from fraudulent banking transactions where the amount is claimed as due and legally recoverable. The Tribunal relied on the written communications and balance-sheet entries to treat the liability as admitted, and applied Section 58 of the Indian Evidence Act, 1872 to hold that admitted facts need not be proved. It also accepted secondary evidence under Section 65(a) of the Indian Evidence Act, 1872 and found that the pleaded fraud was sufficiently particularised under Order VI Rule 4 of the Code of Civil Procedure, 1908. On this basis, the Tribunal concluded that the beneficiaries of the unauthorized credit facilities remained liable to repay the bank, along with interest, and that the matter fell within its jurisdiction under Section 19(1) of the 1993 Act.

Conclusion: The claim was held maintainable as a debt recovery matter, and the bank was entitled to recover the quantified amounts with interest and to obtain a recovery certificate.

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