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Judgment
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JASGURPREET SINGH PURI, J. (Oral)
The present is a Civil Writ Petition filed under Article 226 of the Constitution of India seeking issuance of a writ in the nature of Mandamus directing the respondents to issue No Objection Certificate (NOC)/Settlement Certificate/Clearance Certificate and to release the original title deeds of the mortgaged property bearing House No. 263, Village Gill No. 2, Ludhiana, upon acceptance of the remaining balance settlement amount of approximately Rs. 3,00,000/- in terms of settlement. Further, a prayer is made to consider and decide the representations dated 08.12.2025 (Annexure P-6) and 16.03.2026 (Annexure P-7) filed by the petitioners within a time-bound manner since despite payment of Rs. 20,00,000/- in terms of the mutual settlement and withdrawal of the pending litigation, their claim has not been decided by the respondents.
On a query being put to learned Counsel for the petitioners, as to how the present petition is maintainable against a private Bank, i.e. AU Small Finance Bank Ltd./respondent No. 1, to which he submitted that his rights are duly affected.
We are of the considered view that the law in this regard is well settled in a judgment rendered by the Hon’ble Supreme Court in S. Shobha vs Muthoot Finance Ltd., 2025 SCC Online SC 177. The relevant extract of the same is reproduced below: -
‘8. A body, public or private, should not be categorized as “amenable” or “not amenable” to writ jurisdiction. The most important and vital consideration should be the “function” test as regards the maintainability of a writ application. If a public duty or public function is involved, any body, public or private, concerned or connection with that duty or function, and limited to that, would be subject to judicial scrutiny under the extraordinary writ jurisdiction of Article 226 of the Constitution of India.
9.We may sum up thus:
(1)For issuing writ against a legal entity, it would have to be an instrumentality or agency of a State or should have been entrusted with such functions as are Governmental or closely associated therewith by being of public importance or being fundamental to the life of the people and hence Governmental.
(2)A writ petition under Article 226 of the Constitution of India may be maintainable against (i) the State Government;
Authority; (iii) a statutory body; (iv) an instrumentality or agency of the State; (v) a company which is financed and owned by the State; (vi) a private body run substantially on State funding; (vii) a private body discharging public duty or positive obligation of public nature; and (viii) a person or a body under liability to discharge any function under any Statute, to compel it to perform such a statutory function.
(3)Although a non-banking finance company like the Muthoot Finance Ltd. with which we are concerned is duty bound to follow and abide by the guidelines provided by the Reserve Bank of India for smooth conduct of its affairs in carrying on its business, yet those are of regulatory measures to keep a check and provide guideline and not a participatory dominance or control over the affairs of the company.
(4)A private company carrying on banking business as a Scheduled bank cannot be termed as a company carrying on any public function or public duty.
(5)Normally, mandamus is issued to a public body or authority to compel it to perform some public duty cast upon it by some statute or statutory rule. In exceptional cases a writ of mandamus or a writ in the nature of mandamus may issue to a private body, but only where a public duty is cast upon such private body by a statute or statutory rule and only to compel such body to perform its public duty.
(6)Merely because a statue or a rule having the force of a statute requires a company or some other body to do a particular thing, it does not possess the attribute of a statutory body.
(7)If a private body is discharging a public function and the denial of any rights is in connection with the public duty imposed on such body, the public law remedy can be enforced. The duty cast on the public body may be either statutory or otherwise and the source of such power is immaterial but, nevertheless, there must be the public law element in such action.
(8)According to Halsbury's Laws of England, 3rd Ed. Vol.30, p.682, “a public authority is a body not necessarily a county council, municipal corporation or other local authority which has public statutory duties to perform, and which perform the duties and carries out its transactions for the benefit of the public and not for private profit”. There cannot be any general definition of public authority or public action. The facts of each case decide the point.’
Consequently, we are of the considered view that, in the present case, the grievance of the petitioners does not pertain to any action taken by the respondent/Bank under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, but is only for the purpose of some settlement amount of approximately Rs. 3,00,000/- and the allegation of the petitioners that despite payment of Rs. 20,00,000/- in terms of mutual settlement and withdrawal of pending litigation, their claim has not been decided by the respondents.
In view of above, we do not find any merit in the present petition and the same is hereby dismissed being not entertainable.