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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD THE HON’BLE JUSTICE MOUSHUMI BHATTACHARYA AND THE HON’BLE SMT.JUSTICE RENUKA YARA WRIT PETITION No.9113 OF 2024 (CNR No.HBHC010177072024)

DATE: 15.09.2026 Between:

Sri Raghavendra Oil Mills.

… Petitioner And The Debts Recovery Appellate Tribunal, Kolkata and three others.

...Respondents Mr. Akarsh S.V., learned counsel representing Sri Vadeendra Joshi, learned counsel appearing for the petitioner.

Mr. G. Kalyan Chakravarthy, learned counsel appearing for the respondent Nos.2 and

3(Online).

ORDER: (Per Hon’ble Justice Moushumi Bhattacharya)

1. The writ petition is filed challenging the order dated 08.01.2024 passed by the Debts Recovery Appellate Tribunal, Kolkata, (Camp Court at Hyderabad) (‘DRAT’), whereby the DRAT dismissed the interlocutory application in I.A.No.407 of 2023 in Misc.Appeal Diary No.744 of 2023 filed by the writ petitioner seeking waiver of the pre-deposit condition in the appeal.

2. The writ petitioner is the appellant before the DRAT in an Appeal filed against the order passed by the Debts Recovery Tribunal-II, Hyderabad, (‘DRT’) on 14.01.2020 in I.A.No.5692 of 2019 in S.A.No.202 of 2019, whereby, the writ petitioner’s prayer for amendment of the application (‘S.A.’) was rejected by the DRT.

3. The contention of the writ petitioner before the DRAT was that the order dated 14.01.2020 passed DRT was not a substantive order since the DRT rejected the I.A. filed by the writ petitioner for the amendment of S.A.

4. A perusal of the order dated 14.01.2020 passed by the DRT makes it clear that the writ petitioner’s I.A. for amendment of S.A. was dismissed by the DRT.

5. We have heard learned counsel appearing for the writ petitioner and learned counsel appearing for the respondent Nos.2 and 3/ICICI Bank Ltd.

6. Counsel appearing for the writ petitioner relies upon an order passed by this Court, which was on similar facts, in Gade Sreenivas Reddy v. State Bank of India, 2025 SCC OnLine TS 687. In that decision, this Court considered section 21 of the Recovery of Debts and Bankruptcy Act, 1993, which is pari materia to section 18 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (‘SARFAESI Act’), which relates to filing of an appeal to the Appellate Tribunal and provisos second and third thereof. The second proviso stipulates that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent of the amount of debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less. The third proviso lays down that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent of debt referred to in the second proviso.

7. A bare reading of the second proviso to section 18 of the SARFAESI Act makes it clear that the fifty per cent of the deposit amount must be calculated on the amount of debt due from borrower, as claimed by the secured creditors or

determined by the DRT, whichever is less. This necessarily means that there must be an adjudication of debt by the Debts Recovery Tribunal which requires the DRT to pass a substantive order on the merits of the application.

8. Admittedly, in the present case, the only dispute which was before the DRAT was dismissal of the writ petitioner/borrower’s prayer for amendment of the S.A. Hence, there could not have been any adjudication of debt or any adjudication on merits of the dispute brought by the writ petitioner before the DRT. Therefore, we are of the considered view that present case squarely falls within the decision rendered by this Court in Gade Sreenivas Reddy (supra).

9. We hence find that the DRAT erred in misinterpreting section 18(1) of the SARFAESI Act read with the second and third provisos thereto. The DRT should have considered that the appeal was not on the merits of the S.