Diabetic retinopathy (DR) is a prevalent and potentially blinding eye disease that affects individuals with diabetes. On the other hand, internet of medical things (IoMT) incorporation into DR grading classification offers a promising future for the field of eye health. It optimizes the diagnostic process, increases accessibility to healthcare services, and ultimately improves patient care and outcomes. Therefore, accurate and timely grading of DR severity is crucial for effective disease management. In this article, DR-grading network (DRG-Net) is proposed, which is a comprehensive approach for DR labels classification using the indian diabetic retinopathy image dataset (IDRiD) dataset. To address the imbalanced nature of the dataset, synthetic minority over-sampling technique (SMOTE) is employed for data balancing, ensuring representative samples for each severity level. Then, transfer learning based residual network-50 (ResNet50) architecture is used to extract features from SMOTE outcome, which is a deep learning model renowned for its ability to learn complex image representations. Finally, graph-based K-nearest neighbours (GKNN) classification which utilizes the spatial relationships between samples to make informed decisions, considering the similarity of retinal images in a graph-based representation is introduced for enhanced grading classification of DR. The simulation results show that, the proposed DRG-Net resulted in improved performance as compared to state-of-the-art approaches such as MSA-ResNetGB, DLCNN-MGWO-VW, OHGCNet, and E-DenseNet BC-121 with an accuracy of 99.93%, and F1-score of 99.85%.