Writ petition cannot be issued to prevent Bank from performing its public duty.

(Writ petition filed under Article 226 of Constitution of India praying for issue of a Writ of Mandamus, directing the respondents to forbear from publishing the photographs of the debtors in any newspaper or magazine whatsoever as threatened in the warning notice dated 22.5.2006 issued by the first respondent.)

The question as to whether a Bank/Financial Institution, has the right to publish the photograph of the defaulting borrower in Newspapers, and if such publication offends Article 21 of the Constitution, falls for consideration in this writ petition.

2. The petitioner borrowed a term loan of Rs.6 lakhs from the State Bank of India on 15.5.2001. On the petitioner committing default in payment of the monthly instalments, the Bank issued a notice under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, on 6.2.2006. Subsequently, the Bank also issued a notice dated 22.5.2006, threatening to recover the loan by enforcing the security and bringing it to sale by publishing the details of the properties as well as the photographs of the borrower and the surety in Tamil and English Newspapers.

3. Contending that the publication of his photograph and the photograph of the surety would be violative of Article 21 of the Constitution, the petitioner has filed the above writ petition, seeking a Writ of Mandamus, directing the respondents to forbear from publishing the photographs in any Newspapers or Magazines. The Writ petition was admitted on 15.6.2006 and an interim direction was issued to the respondents not to publish the photographs in any Newspapers or Magazines. The Bank had come up with a petition to vacate the said interim direction and by consent of parties, the writ petition itself was taken for final disposal.

4. I have heard Mr.Amalaraj S.Penikilapatti, learned counsel appearing for the petitioner and Mr.K.Sankaran, learned counsel appearing for the respondents.

5. In the background of an increasing trend among borrowers to avail loans and commit default and later bargain with the Banks and Financial Institutions for the waiver of a portion of the interest and a portion of the principal if possible, the Banks and Financial Institutions were compelled to device innovative methods to secure their interest and also to recover their dues. Some statistics furnished in the Statement of Objects and Reasons to the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, were mind boggling as seen from the following extract:-

"Whereas on 30th September, 1990 more than 15 lakhs of cases filed by the Public Sector Banks and about 304 cases filed by the Financial Institutions were pending in various Courts, recovery of debts involved more than Rs.5,622/- crores in dues of Public Sector Banks and about Rs.391/- crores of dues of the Financial Institutions. The locking up of such huge amount of public money in litigation prevents proper utilisation and recycling of the funds for the development of the country."

6. Even after the enactment of Act No.51 of 1993 and the amendment to the same by Amending Act 1 of 2000, it was felt that the system could not keep pace with change in time. Therefore, with a view to regulate the securitisation and reconstruction of financial assets and enforcement of security interest, the Parliament enacted the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. In the Statement of Objects and Reasons to the said Act, the Law Makers took note of the fact that the Banking and Financial Sector in our country do not have a level playing field as compared to other participants in the Financial Markets in the World and that our existing legal frame work relating to commercial transactions has not kept pace with the changing commercial practices and financial sector reforms. Therefore, obviously with a view to keep pace with the changing commercial practices and financial sector r