Banking Ombudsman award is binding once accepted, and the bank must comply without insisting on surety.

Directions issued under Section 35A of the Banking Regulation Act, 1949 have statutory force, and an award under the Banking Ombudsman Scheme, 1995 becomes binding once the complainant accepts it. The Scheme provides no appeal against the award, and a bank's request to await Reserve Bank permission does not suspend its obligation to comply. Where the challenge concerns only implementation and the insistence on surety, the matter is confined to enforcement rather than review of the Ombudsman's merits. The award was therefore treated as enforceable, and the bank was directed to release the amount without further delay or additional surety.

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Issues: Whether the award passed by the Banking Ombudsman could be enforced by directing the bank to comply with it and release the awarded amount without insisting on furnishing surety.

Analysis: The Banking Ombudsman Scheme, 1995 was framed by the Reserve Bank of India in exercise of power under Section 35A of the Banking Regulation Act, 1949. Directions issued under that provision have statutory force, and the award made under the Scheme is to be treated as binding once the complainant accepts it. The Scheme does not provide an appeal against the award, and the bank's request to await permission from the Reserve Bank did not suspend its obligation to comply. Since the writ petition challenged only the insistence on surety and sought implementation of the award, the Court declined to go into the merits of the Ombudsman's findings and confined itself to enforcement.

Conclusion: The award was held enforceable, and the bank was directed to comply with it and pay the amount awarded without insisting on further delay on the ground of pending representation before the Reserve Bank.

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