Workers' participation in bank management requires statutory backing; RBI cannot be compelled to appoint an employee director absent enabling law.

A writ of mandamus against a bank and the Reserve Bank of India was maintainable where the relief was directed principally to the RBI's statutory powers under banking law. However, workers' participation in management under Article 43A is not self-executing and cannot be enforced without an enabling statute. For a banking company governed by the Companies Act and the Banking Regulation Act, directors are appointed under the company law framework subject to section 10A, and the RBI's power under section 35A remains confined to its statutory grounds. In the absence of an express legal provision, neither the bank nor the RBI could be compelled to appoint an employee director or fill the vacancy for that purpose.

---

---

Issues: (i) whether the writ petition was maintainable against the bank and the Reserve Bank of India for a mandamus to compel filling of a board vacancy; (ii) whether the Reserve Bank of India could be directed to secure employee representation on the board of a banking company and require filling of the vacancy caused by retirement of the petitioner.

Issue (i): whether the writ petition was maintainable against the bank and the Reserve Bank of India for a mandamus to compel filling of a board vacancy.

Analysis: The relief sought was against a statutory authority to exercise powers under the Banking Regulation Act, 1949. A challenge to the maintainability of the writ on the ground that the bank was incorporated under the Companies Act was rejected because the mandamus was sought principally against the Reserve Bank of India in relation to statutory duties.

Conclusion: The writ petition was maintainable.

Issue (ii): whether the Reserve Bank of India could be directed to secure employee representation on the board of a banking company and require filling of the vacancy caused by retirement of the petitioner.

Analysis: Article 43A of the Constitution of India embodies the principle of workers' participation in management, but it is not self-executing and requires suitable legislation. In the case of a banking company governed by the Companies Act, 1956 and the Banking Regulation Act, 1949, directors are appointed under the company law subject to the statutory requirements of section 10A. The Reserve Bank's power under section 35A is confined to situations where statutory conditions exist, such as public interest, banking policy, depositor protection, or proper management. In the absence of any statutory provision enabling compulsory nomination of an officer or employee as director, neither the bank nor the Reserve Bank could be compelled to fill the vacancy for the purpose of employee representation.

Conclusion: The petitioner was not entitled to a mandamus directing the Reserve Bank of India to compel appointment of an employee director or to fill the vacancy.

Final Conclusion: The court held that employee participation in management could not be enforced in the absence of an enabling statutory provision, and the Reserve Bank's supervisory powers did not extend to compelling the bank to fill the vacant directorship in the manner sought.

Ratio Decidendi: A writ of mandamus cannot compel a statutory regulator to act beyond the limits of its enabling provisions, and workers' participation in management is enforceable only when backed by a governing statute.

---