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2016 DIGILAW 1382 (ALL)

Shabad Ahmad v. H. D. F. C. Bank Ltd. Thru Its Managing Director

2016-04-13

ASHOK PAL SINGH, NARAYAN SHUKLA

body2016
JUDGMENT Shri Narayan Shukla,J. Heard Mr. Murli Manohar Srivastava, learned counsel for the petitioner as well as Mr. Manu Dixit, learned counsel for the respondent-Bank. 2. The petitioner has assailed the termination letter dated 04.01.2016 whereby he had been terminated from service by Senior Vice President, Human Resource Division, H.D.F.C. Bank Ltd. Mumbai i.e. opposite party No.2(in short Bank). 3. Learned counsel for the respondent-Bank had raised objection against the maintainability of the writ petition under Article 226 of the Constitution of India. He contended that the H.D.F.C. Bank is purely a private Bank which is being purely maintained by private personnel. In writ petition No. 964 (SB) of 2011 which was filed before this Court, against ICICI Bank Ltd. which is similar to HDFC Bank, this Court held as under: - "13. It is settled proposition of law that a writ of mandamus may be issued under writ jurisdiction in case there is violation of statutory provisions or there is violation of statutory duty by the authority. Ordinarily, writ of certiorari may not be issued against the order passed by the private bodies like respondent Bank but a mandamus may be issued to discharge statutory obligation in public interest. In the present case, nothing has been brought on record to satisfy the Court that some statutory duty may be cast upon the respondents or the petitioner possesses some statutory right and for whose enforcement this Court may interfere under Article 226 of the Constitution of India to issue a writ of mandamus to discharge their statutory obligations. 14. In view of the above, the writ petition seems to be not maintainable. The writ petition is dismissed with liberty to the petitioner to approach appropriate forum to ventilate his grievance. It is clarified that we have not entered into the merit of the case." He further cited a case of Federal Bank Ltd. Vs. Sagar Thomas 2003 (10) SCC 733 relevant paragraphs 32 and 33 are extracted below: - "32. Merely because the Reserve Bank of India lays the banking policy in the interest of the banking system or in the interest of monetary stability or sound economic growth having due regard to the interests of the depositors etc. Sagar Thomas 2003 (10) SCC 733 relevant paragraphs 32 and 33 are extracted below: - "32. Merely because the Reserve Bank of India lays the banking policy in the interest of the banking system or in the interest of monetary stability or sound economic growth having due regard to the interests of the depositors etc. as provided under Section 5(c)(a) of the Banking Regulation Act does not mean that the private companies carrying on the business of or commercial activity of banking, discharge any public function or public duty. These are all regulatory measures applicable to those carrying on commercial activity in banking and these companies are to act according to these provisions failing which certain consequences follow as indicated in the Act itself. Provision regarding acquisition of a banking company by the Government, it may be pointed out that any private property can be acquired by the Government in public interest. It is now judicially accepted norm that private interest has to give way to the public interest. If a private property is acquired in public interest it does not mean that the party whose property is acquired is performing or discharging any function or duty of public character though it would be so for acquiring authority. 33. For the discussion held above, in our view, a private company carrying on banking business as a scheduled bank, cannot be termed as an institution or company carrying on any statutory or public duty. A private body or a person may be amenable to writ jurisdiction only where it may become necessary to compel such body or association to enforce any statutory obligations or such obligations of public nature casting positive obligation upon it. We don't find such conditions are fulfilled in respect of a private company carrying on a commercial activity of banking. Merely regulatory provisions to ensure such activity carried on by private bodies work within a discipline, do not confer any such status upon the company nor puts any such obligation upon it which may be enforced through issue of a writ under Article 226 of the Constitution. Present is a case of disciplinary action being taken against its employee by the appellant Bank. Respondent's service with the bank stands terminated. The action of the Bank was challenged by the respondent by filing a writ petition under Article 226 of the Constitution of India. Present is a case of disciplinary action being taken against its employee by the appellant Bank. Respondent's service with the bank stands terminated. The action of the Bank was challenged by the respondent by filing a writ petition under Article 226 of the Constitution of India. The respondent is not trying to enforce any statutory duty on the part of the Bank. That being the position, the appeal deserves to be allowed." He has also cited the case of Binny Ltd. Vs. V. Sadasivan 2005(6) SCC 657 the relevant paragraph 32 of which is quoted below: - "32. Applying these principles, it can very well be said that a writ of mandamus can be issued against a private body which is not a State within the meaning of Article 12 of the Constitution and such body is amenable to the jurisdiction under Article 226 of the Constitution and the High Court under Article 226 of the Constitution can exercise judicial review of the action challenged by a party. But there must be a public law element and it cannot be exercised to enforce purely private contracts entered into between the parties." In reply the learned counsel for the petitioner has submitted that the respondent-Bank discharges the public functions therefore the Bank itself being public functionary the writ petition would therefore be maintainable against it. In support of his submission he has cited a decision of Supreme Court in Board of Control for Cricket in India Vs. Cricket Association of Bihar and others 2015 (3) SCC 251 . In the said case the Supreme Court had discussed its earlier judgment of Ramana Dayaram Shetty Vs. International Airport Authority of India (1979) 3 SCC 489 the relevant paragraph 16 is extracted below: - "16. There is also another factor which may be regarded as having a bearing on this issue and it is whether the operation of the corporation is an important public function. It has been held in the United States in a number of cases that the concept of private action must yield to a conception of State action where public functions are being performed. Vide Arthur S. Miller: "The Constitutional Law of the "Security State'''*"(10 Stanford Law Review 620 at 664). It has been held in the United States in a number of cases that the concept of private action must yield to a conception of State action where public functions are being performed. Vide Arthur S. Miller: "The Constitutional Law of the "Security State'''*"(10 Stanford Law Review 620 at 664). It was pointed out by Douglas, J., in Evans v. Newton15 L ED 2d373: 382 US 296 (1966) that "when private individuals or groups are endowed by the State with powers or functions governmental in nature, they become agencies or instrumentalities of the State". Of course, with the growth of the welfare State, it is very difficult to define what functions are governmental and what are not, because, as pointed out by Villmer, L.J., in Pfizer v. Ministry of Health, 1964 Ch 614: (1963) 2 WLR 286: (1963) 1 All ER 590 there has been, since mid-Victorian times, "a revolution in political thought and a totally different conception prevails today as to what is and what is not within the functions of Government". Douglas, J., also observed to the same effect in New York v. United States 90 L Ed 326 : 326 US 572 (1946): " A State's project is as much a legitimate governmental activity whether it is traditional or akin to private enterprise, or conducted for profit." Cf. Helverillg v. Gerhardt 82L Ed 1427: 304 US 405 (1938). A State may deem it as essential to its economy that it own and operate a railroad, a mill, or an irrigation system as it does to own and operate bridges, street lights, or a sewage disposal plant. What might have been viewed in an earlier day as an improvident or even dangerous extension of state activities may today be deemed indispensable. It may be noted that besides the so called traditional functions, the modern State operates a multitude of public enterprises and discharges a host of other public functions. If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. This is precisely what was pointed out by Mathew, J., in Sukhdev v. Bhagatram (supra) where the learned Judge said that "institutions engaged in matters of high public interest or performing public functions are by virtue of the nature of the functions performed government agencies. This is precisely what was pointed out by Mathew, J., in Sukhdev v. Bhagatram (supra) where the learned Judge said that "institutions engaged in matters of high public interest or performing public functions are by virtue of the nature of the functions performed government agencies. Activities which are too fundamental to the society are by definition too important not to be considered government functions." He has further cited a decision in the case of Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust and others Vs. V. R. Rudani and others (1989) 2 SCC 691 , the relevant paragraph No.15 is quoted herein below: - "15. If the rights are purely of a private character no mandamus can issue. If the management of the college is purely a private body with no public duty mandamus will not lie. These are two exceptions to mandamus. But once these are absent and when the party has no other equally convenient remedy, mandamus cannot be denied. It has to be appreciated that the appellants-trust was managing the affiliated college to which public money is paid as government aid. Public money paid as government aid plays a major role in the control, maintenance and working of educational institutions. The aided institutions like government institutions discharge public function by way of imparting education to students. They are subject to the rules and regulations of the affiliating University. Their activities are closely supervised by the University authorities. Employment is such institutions, therefore, is not devoid of any public character. So are the service conditions of the academic staff. When the University takes a decision regarding their pay scales, it will be binding on the management. The service conditions of the academic staff are, therefore, not purely of a private character. It has super-added protection by University decisions creating a legal right-duty relationship between the staff and the management. When there is existence of this relationship, mandamus cannot be refused to the aggrieved party." In so far as the question of pervasive control of the Government over the respondent-Bank is concerned, the petitioner has failed to establish any such control of the Government over the respondent-Bank. The respondent-Bank is run by the Board of Directors who have purely private entity. The respondent-Bank is run by the Board of Directors who have purely private entity. Therefore, we are of the view that only being a public functionary the petitioner cannot claim that it is amenable to writ jurisdiction for the reason that the Supreme Court in Federal Bank Ltd. Vs. Sagar Thomas (Supra) has held that the private company carrying on banking business as a scheduled bank, cannot be termed as an Institution or company carrying on any statutory or public duty. A private body or a person may be amenable to writ jurisdiction only where it may become necessary to compel such body or association to enforce any statutory obligations or such obligations of public nature casting positive obligation upon it. In the present case the petitioner's appointment was purely a contractual appointment being made under the terms and conditions of the contract which shall be governed under the terms of contract entered into between the employees and employer under the contractual matters. The principal of judicial review has limited application which cannot be a subject matter of a writ petition. Regard being had to the aforesaid discussions, we hereby dismiss the writ petition as not maintainable.