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Judgment
SUDEEPTI SHARMA J. (ORAL)
The challenge in all the four writ petitions is to termination order as well as advertisement against the respondent-Company, which is a company registered under the Companies Act, 1956, and not the instrumentalities of the State.
Learned counsel for the respondents, at the very outset, raises the preliminary objections regarding the maintainability of the present writ petitions.
Learned counsel for the petitioner(s) are not able to rebut the stand taken by the respondents on maintainability of the present writ petitions.
I have heard learned counsel for the parties and perused the whole file with their able assistance.
The only question involved in the present writ petitions is that as to whether these writ petitions would be maintainable against the respondent-Company.
Since the common question of law is involved in all the four writ petitions, therefore, all the writ petitions are decided vide this common judgment.
Respondent No.1-UOI has filed its short reply wherein the stand taken by it is that respondent No.2 is neither a statutory body nor it is performing any statutory/public function of the State in terms of Article 12 of the Constitution of India and it is a company incorporated under the provisions of the Companies Act, 1956 and is governed by its Memorandum and Articles of Association, which is managed by the Board of Directors. Respondents No.2 and 3 in their written statement also take the same stand that respondent-company is a company registered under the Companies Act, 1956, and is governed by its Memorandum and Articles of Association and does not fall under the definition of “State” in terms of Article 12 of the Constitution of India.
Hon’ble the Supreme Court of India in the judgment passed in S.Shobha Vs. Muthoot Finance Ltd., 2025 SCC Online SC 177 has held that a private company, even if regulated by the Reserve Bank of India, is not considered a “State” under Article 12 of the Constitution and is not amenable to writ jurisdiction unless it performs a public duty or function. The relevant portion of the judgment passed in S.Shobha’s case (supra) is reproduced as under:-
“XXX XXX XXX XXX
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; (ii) 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. XXX XXX XXX XXX”
In view of the stand taken by the respondents in their written statements and the law laid down by Hon’ble the Supreme Court, as referred to above, all the writ petitions are dismissed as not maintainable.
Pending applications, if any, also stand disposed of.
Photocopy of this order be placed on the file of connected cases.