Writ petitions against non-nationalized banks are not maintainable as they do not qualify as 'State' under Article 12, and remedies must be sought through civil suits.

Order :

1. The petitioner has approached this Court invoking its writ jurisdiction of this Court under Article 226 of the Constitution of India and assailed the order dated 30.12.2024, whereby he has been visited with an order of punishment of dismissal from services. Subsequent order dated 20.01.2025, whereby the appeal preferred against such order has been rejected by the respondent no.2 – Appellate Authority, Axis Bank Limited has also been challenged.

2. At the outset, the Court posed a question to Mr. Muktesh Maheshwari, learned counsel for the petitioner that how the writ petition laying challenge to the order of disciplinary authority or Appellate Authority of respondent-Bank (Axis Bank Limited), which is not a nationalized bank, is maintainable? To which, Mr. Maheshwari responded by submitting that the petitioner has been dismissed from service in violation of principles of natural justice and since his fundamental right under Article 16 of the Constitution of India has been infracted, he can maintain the writ petition.

3. Learned counsel further argued that since the petitioner has exhausted the remedy available under By-laws of the Bank, he has no other option but to approach this Court by invoking its writ jurisdiction under Article 226 of the Constitution of India.

4. Learned counsel submitted that in many a cases, civil courts have held that they would not sit as an Appellate Authority over the order(s) passed by the disciplinary authority and the Appellate Authority and, therefore, the writ petition be entertained.

5. Learned counsel further submitted that since the respondent–Bank is also discharging public functions, the present writ petition is maintainable in the light of the judgment of Hon’ble the Supreme Court rendered in the cases of Ramesh Ahluwalia vs. State of Punjab & Ors., reported in (2012) 12 SCC 331 and Zee Telefilms Ltd. & Anr. vs. Union of India & Ors. reported in (2005) 4 SCC 649.

6. Heard learned counsel for the petitioner.

7. It is not in dispute that the respondent – Bank is not a Nationalized Bank. Hence, barring exceptional cases, it cannot be treated to be a ‘State’ or ‘instrumentality of State’ within the meaning of Article 12 of the Constitution of India, more particularly when it comes to dispute relating to employer-employee relationship.

8. True it is, that in the cases of Zee Telefilms Ltd. (supra) and Ramesh Ahluwalia (supra), Hon’ble the Supreme Court has held that an instrumentality, which is discharging public functions is covered in the sweep of ‘State’ under Article 12 of the Constitution of India, but the first question to be considered is, as to whether the functions, which the respondent – Bank is discharging are public functions?

9. According to this Court, the respondent – Bank is accepting deposits, operating saving accounts and advancing loans, which can purely be defined as carrying of business or commercial activities and cannot be said to be public functions by any stretch of imagination.

10. A gainful reference of the judgment of Hon’ble the Supreme Court in the case of Federal Bank Ltd. vs. Sagar Thomas & Ors., reported in (2003) 10 SCC 733 be made, wherein the Apex Court has observed thus:

“There are a number of such companies carrying on the profession of banking. There is nothing which can be said to be close to the governmental functions. It is an old profession in one form or the other carried on by individuals or by a group of them. Losses incurred in the business are theirs F as well as the profits. 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, are such which d