An appellate tribunal having entertained an appeal and directed a substantial pre-deposit cannot arbitrarily refuse to decide the merits of the appeal by remitting the matter to the lower forum.

(Order of the Court was made by N.SATHISH KUMAR, J.

Challenging the order of the Debt Recovery Appellate Tribunal in dismissing the appeal filed by the petitioner, this writ petition has been filed.

2. Originally, the petitioner filed S.A.No.223/2026 before the Debts Recovery Tribunal, Madurai, challenging the sale notice in respect of the immovable properties on various grounds. In the interim application in I.A.No. 997/2026 in S.A.No.223/2026, the DRT granted conditional stay of further proceedings pursuant to the sale notice dated 19.01.2026 subject to payment of entire outstanding amount in instalments. Challenging the said interim order, the petitioner filed appeal before the Debt Recovery Appellate Tribunal, Chennai, in RA(SA)No.35/2026. The DRAT having found that sale is already over and third party interest is created, by order dated 10.04.2026, directed the petitioner to deposit a sum of Rs.40,53,212.85p in two equal instalments that is, on or before 24.04.2026 and 08.05.2026 respectively, and entertained the appeal. Pursuant to such direction, the petitioner also has made payments as directed by DRAT. Later, instead of deciding the appeal on merits, the DRAT by order dated 12.05.2026, has rejected the appeal stating that the sale is already over, hence, the DRT has to decide the S.A.No.223/2026.

3. We are of the view that having entertained the appeal with the direction to deposit a substantial amount, the DRAT ought to have decided the appeal on its own merits without directing the DRT to dispose of the matter. Such an order of the DRAT, in our view, is arbitrary. Hence, the order dated 12.05.2026 made in MA(SA)No.35 of 2026 on the file of the Debt Recovery Appellate Tribunal, Chennai, is set aside and the matter is remitted to DRAT to dispose of the appeal on merits within a period of one month from the date of receipt of a copy of this order.

4. With the above direction, the Writ Petition is allowed. No costs.

Consequently, connected miscellaneous petitions are closed.

[N.S.K., J.] & [M.J.R., J.]

04.06.2026 Note to Registry : While entertaining the appeal as against the orders of the Debts Recovery Tribunals, Registry is directed to see that Presiding Officers of the Tribunals are not made as parties. It is suffice, the Registrars of the concerned Tribunals may be arrayed as parties for the purpose of service of notice and to call for records.