Court No. - 3
Case :- WRIT - C No. - 17080 of 2021 Petitioner :- Pankaj Chauhan And Another Respondent :- State Of U.P. And 3 Others Counsel for Petitioner :- Lalit Kumar Srivastava Counsel for Respondent :- C.S.C.
Hon'ble Naheed Ara Moonis,J. Hon'ble Saumitra Dayal Singh,J.
Heard Shri Lalit Kumar Srivastava, learned counsel for the petitioners and learned Standing Counsel for the State.
The instant writ petition has been filed seeking following relief:
"Issue a writ, order or direction in the nature of Mandamus commanding the respondent bank to release the vehicles of the petitioners forthwith and accept the arrears of loan in easy installments as per the guide lines of the central Govt. which was passed during the pandemic Covid-19."
Besides the fact, the respondent no. 4 is a private bank and not an instrumentality of the State within the meaning of Article 12 of the Constitution of India. The dispute evidently is between two private parties, namely, the petitioner, who is the borrower, and the respondent, who is the private bank. The writ petition is not maintainable to enforce a contract between two private entities nor can any direction be issued for quashing the consequential proceedings in exercise of writ jurisdiction in the facts of the present case.
In the case of Federal Bank Ltd. v. Sagar Thomas and others, (2003) 10 SCC 733 : AIR 2003 SC 4325, the Hon'ble Supreme Court has held as under:
"28. As indicated earlier, share capital of the appellant bank is not held at all by the Government nor is any financial assistance provided by the State, nothing to say which may meet almost the entire expenditure of the company. The third factor is also not answered since the appellant bank does not enjoy any monopoly status nor can it be said to be an institution having State protection. So far as control over the affairs of the appellant bank is concerned, they are managed by the Board of Directors elected by its shareholders. No governmental agency or officer is connected with the affairs of the appellant bank nor is anyone of them a member of the Board of Directors. In the normal functioning of the private banking company there is no participation or interference of the State or its authorities. The statutes have been framed regulating the financial and commercial activities so that fiscal equilibrium may be kept maintained and not get disturbed by the malfunctioning of such companies or institutions involved in the business of banking. These are regulatory measures for the purposes of maintaining a healthy economic atmosphere in the country.
29. .... Any business or commercial activity, may be banking, manufacturing units or related to any other kind of business generating resources, employment, production and resulting in circulation of money are no doubt, such which do have impact on the economy of the country in general. But such activities cannot be classified as one falling in the category of discharging duties or functions of a public nature. Thus the case does not fall in the fifth category of cases enumerated in the case of Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722]. Again we find that the activity which is carried on by the appellant is not one which may have been earlier carried on by the Government and transferred to the appellant company."
Following the law laid down by the Hon'ble Supreme Court in the above decision that the private financial institutions, carrying of business or commercial activity, may be performing public duties, but cannot be considered to be covered under the definition of "State" under Article 12 of the Constitution of India, the writ petition against such entity is not maintainable before the High Court.
Accordingly, the writ petition is hereby dismissed.
Order Date :- 27.7.2021 Saurabh