Filing Appeals before DRAT against DRT Interim Orders & Final Judgments

1. Challenging DRT Interim Orders under Section 18 SARFAESI Act

When a Debt Recovery Tribunal (DRT) refuses to grant stay on physical possession, rejects an IA for restraining e-auction, or passes an adverse interim direction, the aggrieved borrower or guarantor has a statutory right of appeal before the **Debt Recovery Appellate Tribunal (DRAT)** under Section 18 of the SARFAESI Act 2002 (or Section 20 of the RDB Act 1993 for Original Applications).

2. Mandatory Pre-Deposit Jurisprudence & Reduction Petitions

Under the 2nd proviso to Section 18(1) of the SARFAESI Act, an appeal by a borrower before DRAT requires a mandatory pre-deposit of 50% of the debt claimed by the secured creditor. However, under the 3rd proviso, DRAT is vested with statutory discretion to reduce this pre-deposit down to a minimum of 25% for recorded reasons.

Key Legal Grounds for Pre-Deposit Reduction to 25%:

• Prima Facie Patent Illegality in DRT Order: Demonstrating that the DRT ignored statutory mandatory provisions (such as Section 31(i) agricultural bar or Section 13(3A) objection rejection breach).
• Severe Financial Hardship & Asset Seizure: Showing that all commercial assets and bank accounts have been frozen by the lender, making a 50% deposit mathematically impossible.
• Inflated & Unverified Bank Dues Claim: Establishing through audit that the bank's claimed dues include unapplied penal interest, compound interest, or miscalculated NPA accounting entries.

3. Appellate Jurisdiction of the 5 DRATs in India

India's 39 DRTs are geographically mapped under 5 Appellate Tribunals (DRAT Delhi, DRAT Allahabad, DRAT Mumbai, DRAT Kolkata, DRAT Chennai). Effective representation before DRAT requires swift filing within the 30-day statutory limitation period along with stay applications and pre-deposit reduction petitions.