A formal complaint was raised by a member of the college last November, which resulted in Rev Martyn's suspension.
The tribunal's ruling to reinstate the Dean was announced on Christ Church's website on Wednesday.
"As required by Christ Church's Statutes, an internal tribunal was convened to consider a complaint raised against the Dean in September 2018. Following a thorough investigation, the tribunal has decided that the charges are not upheld and that there is no cause to remove the Dean as Head of House."
The Bishop of Oxford, Dr Steven Croft, welcomed the decision, saying: "I am delighted to learn that this matter is now resolved. I look forward to seeing Martyn return to the Cathedral and his duties as Dean of Christ Church.
"This news will be widely welcomed across the diocese of Oxford. These have been testing times for all involved, and my prayers are with Martyn and Emma, the Chapter and wider College in the coming months."
Details regarding the nature of the complaint made against Percy were not made public, but the college told alumni in a letter in January that the row related to pay.
It's believed that Percy, who is both college head and dean of the cathedral earns around £90,000 a year plus accommodation, which is relatively low compared with other college heads.
Concerns over Percy's governance of the college were also thought to be part of the dispute, following efforts by the Dean to reform pay structures.
Under the college's statutes, there are limited circumstances in which the dean can be removed.
These include persistent failure or neglect of duties; being convicted of an offence that renders the dean unfit for office; physical or mental incapacity and behaviour of an "immoral, scandalous or disgraceful nature".
Supporters of the dean raised concerns that Percy was not given the opportunity to defend allegations against him or put forward any supporting documentation.
The hearing, presided over by retired High Court judge Sir Andrew Smith, was expected to cost the college at least £500,000.
Percy's supporters raised more than £85,000 to cover the cost of legal fees.
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