2023 Supreme(Telangana) 429

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
SUREPALLI NANDA, J.
Mrs.Shobha Gupta – Appellant
Versus
Union of India & others - Respondents
Writ Petition No.16637 OF 2023
Decided on : 29-11-2023

A writ petition is maintainable against a bank to enforce a public duty under RBI circulars, which create a right in the petitioner to avail the moratorium. However, the petitioner must exhaust her alternative remedy of approaching the Debt Recovery Tribunal before seeking relief under Article 226 of the Constitution.

Headnote:

BANKING - NPA - COVID-19 RELIEF - MORATORIUM - ECLGS - MAINTAINABILITY OF WRIT PETITION - ENFORCEMENT OF PUBLIC DUTY - CIRCULAR ISSUED BY RBI - RIGHT TO AVAIL MORATORIUM - DUTY OF BANKS TO IMPLEMENT CIRCULAR - AVAILABILITY OF ALTERNATIVE REMEDY - EXHAUSTION OF STATUTORY REMEDIES - JURISDICTION OF HIGH COURT UNDER ARTICLE 226 - DIRECTIONS TO BANKS TO CONSIDER REPRESENTATION OF BORROWER - WRIT PETITION DISPOSED OFF.

Fact of the Case:

Petitioner, a borrower, filed a writ petition challenging the declaration of her loan account as a Non-Performing Asset (NPA) by the bank. The petitioner contended that the bank failed to implement the COVID-19 relief measures announced by the Reserve Bank of India (RBI), including the moratorium on loan repayments and the Emergency Credit Line Guarantee Scheme (ECLGS). The bank, on the other hand, argued that the petitioner's account was not eligible for these reliefs as it was delinquent prior to the pandemic.

Finding of the Court:

The court held that the writ petition was maintainable as it related to the enforcement of a public duty under the RBI circulars, which created a right in the petitioner to avail the moratorium. The court also observed that the bank had not considered the petitioner's grievance as she had not submitted any representation to the bank or the RBI. However, the court declined to grant the relief sought by the petitioner as she had not exhausted her alternative remedy of approaching the Debt Recovery Tribunal.

Issues: 1. Whether the writ petition is maintainable against the bank? 2. Whether the bank was obligated to implement the RBI circulars providing COVID-19 relief measures? 3. Whether the petitioner was entitled to the moratorium and ECLGS benefits? 4. Whether the petitioner had exhausted her alternative remedy of approaching the Debt Recovery Tribunal?

Ratio Decidendi: 1. The court held that the writ petition was maintainable as it related to the enforcement of a public duty under the RBI circulars, which created a right in the petitioner to avail the moratorium. The court relied on the judgments of the Supreme Court in Anand Mukta Sadguru Shree Mukta v. V.R.Rudani and Others, Ramesh Ahluwalia v. State of Punjab and Others, and M/s. Radhakrishan Industries vs. State of Himachal Pradesh, which held that the High Court has the power to issue writs not only for the enforcement of fundamental rights but also for any other purpose, including the enforcement of public duties. The court also noted that the bank's duty to implement the RBI circulars was a positive obligation owed to the petitioner, and therefore, mandamus could not be denied. 2. The court held that the bank was obligated to implement the RBI circulars providing COVID-19 relief measures. The court relied on the judgment of the Supreme Court in Kamal Kumar Kalia v. Union of India and Another, which directed the RBI to ensure the implementation of the circular dated 27.03.2020 in its letter and spirit. The court also noted that the RBI circulars were issued to protect and preserve the economy of the country on account of the COVID-19 pandemic, and therefore, their enforcement would come within the purview of enforcement of a public duty. 3. The court held that the petitioner was not entitled to the moratorium and ECLGS benefits as she had not submitted any representation to the bank or the RBI. The court observed that the petitioner had not exhausted her alternative remedy of approaching the Debt Recovery Tribunal, and therefore, she could not seek relief under Article 226 of the Constitution. 4. The court held that the petitioner had not exhausted her alternative remedy of approaching the Debt Recovery Tribunal. The court noted that the petitioner had challenged the possession notice issued by the bank under Rule 8(1) of the SARFAESI Act before the Debt Recovery Tribunal, and therefore, she should have pursued her remedy before the Tribunal before approaching the High Court.

Final Decision: The writ petition was disposed off with no order as to costs. The court directed the petitioner to submit a detailed representation to the bank and the RBI within two weeks, and the bank and the RBI were directed to consider the representation and pass appropriate orders within two weeks thereafter.