Isabella Mariam

The High Court of Judicature at Allahabad, Lucknow Bench, Single Bench of Justice Pankaj Bhatia, quashed an order issued by the Debts Recovery Tribunal (DRT) Lucknow, stating that the impugned order lacked application of mind and failed to meet the standards of reasoned decision-making. The court directed that the matter be remanded to the DRT for fresh adjudication within four weeks. It also instructed that no coercive action be taken against the petitioners during that period. Further, the court ordered that a copy of this judgment be forwarded to the Ministry of Finance for consideration of training for the concerned officer to ensure effective functioning of the DRT.

The petition was filed under Article 227 of the Constitution of India. The petitioners challenged the order dated 02.05.2025 passed by the Debts Recovery Tribunal (DRT), Lucknow, which rejected their application for interim relief. The petitioners' counsel, Alok Saxena, presented the matter before the High Court, assisted by Paras Pradhan. The respondents were represented by counsel Sri Ashwani Kumar Singh for the Union of India, and Sri Abhishek Khare with Ms. Parul Sharma for the respondent bank.

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The petitioners had filed for interim protection against coercive measures, specifically the taking of physical possession of secured assets. However, the DRT, in its order dated 02.05.2025, rejected their application. According to the petitioner’s counsel, while it was acknowledged that orders passed by the DRT are ordinarily appealable, the petition focused on the nature and quality of the reasoning given in the DRT’s order. It was argued that the order not only lacked legal reasoning but also failed to take into consideration the issues and contentions raised.

Attention was drawn to the structure of the impugned order, which merely listed the contentions of the petitioner and the reply of the respondents, albeit with factual inaccuracies, followed by an abrupt conclusion dismissing the application. The petitioners contended that no grounds were cited, and no reasoning was evident in support of the decision. They submitted that such non-speaking orders undermine the integrity of the judicial process and the purpose for which the DRT was established.

In their submissions, the counsel for the respondents attempted to justify the decision but acknowledged that the order lacked the qualities of a reasoned judgment expected from a Tribunal. The petitioner stated that the DRT's decision-making process was indicative of poor procedural adherence and reflected inadequate training of the adjudicating officer.

The matter was brought before the High Court not just to challenge the specific order, but also to spotlight a recurring issue in the functioning of the DRT, Lucknow. It was argued that similar orders have been observed in other matters as well, prompting the court to consider broader administrative steps.

Upon reviewing the impugned order, the court found no application of mind and deemed the decision-making process flawed. The High Court, therefore, quashed the DRT's order and remanded the matter for fresh adjudication.

Justice Pankaj Bhatia made detailed observations regarding the conduct of the DRT and the nature of the impugned order. The court stated in "a reasoned order is heart and soul of any judicial order". It was recorded that: "A perusal of the order, reveals total non-application of mind and prima-facie gives an impression that there is a lack of training of the Member Tribunal manning the office at DRT."

The court evaluated the DRT's handling of the matter and found it lacking in substantive reasoning. It remarked: "The manner of decision making, according to him, speaks very poorly of the manner in which the DRT is functioning."

Further, addressing the abrupt conclusion of the impugned order, the judgment noted: "An abrupt order has been passed recording that the applicant would not make any case for restraining the respondents from taking physical possession of the secured assets, as such, the application is dismissed."

The judgment pointed out that the order did not engage with the merits of the arguments presented and failed to provide any legal reasoning, stating: "No reasons whatsoever have been mentioned while disposing of the application."

Importantly, the court recognized a pattern of similar judgments being issued by the DRT, leading to an institutional observation: "This court is noticing, similar orders passed by the DRT Lucknow in various matters."

The High Court, having found the DRT's order dated 02.05.2025 devoid of application of mind and lacking any valid decision-making process, proceeded to quash the said order.

The court recorded: "Finding the order dated 02.05.2025 to be short of any valid decision-making process and without any application of mind, the order dated 02.05.2025 is quashed."

Subsequently, the matter was remanded to the DRT, Lucknow with a clear directive: "The matter is remanded to the DRT Lucknow to pass a fresh order in accordance with law after considering the case as pleaded by the petitioner and the defense that may be taken by the respondents with all expedition."

Further, the court imposed a time-bound framework for this process: "The fresh order, as directed above, shall be passed preferably within a period of four weeks."

In addition, to protect the interests of the petitioners, the High Court directed: "For a period of four weeks, no coercive action shall be taken against the petitioner."

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Recognizing the broader implications of the Tribunal’s functioning, the court instructed the Senior Registrar: "Senior Registrar of this Court is directed to send a copy of this order to the Ministry of Finance, Government of India, New Delhi for taking appropriate steps."

Finally, the writ petition was formally disposed of by the court.

Advocates Representing the Parties

For the Petitioners: Alok Saxena, Advocate, Paras Pradhan, Advocate

For the Respondents: Sri Ashwani Kumar Singh, Advocate (Union of India), Sri Abhishek Khare, Advocate, Ms. Parul Sharma, Advocate (Respondent Bank)

Case Title: Vimla Kashyap And 2 Others v. Union of India Thru. Secy. Ministry of Financial Services New Delhi and 3 Others

Neutral Citation: 2025: AHC-LKO:29017

Case Number: MATTERS UNDER ARTICLE 227 No. - 2946 of 2025

Bench: Justice Pankaj Bhatia

[Read/Download order]