Non-statutory one time settlement guidelines cannot be enforced by mandamus absent statutory authority.

One time settlement guidelines did not create an enforceable right because they were not shown to have been issued by the Reserve Bank under statutory authority, but only through its Chief General Manager. In the absence of a statutory duty, the guidelines had no statutory flavour and could not be enforced by writ of mandamus in banking recovery matters. Courts will not compel implementation of non-statutory instructions or substitute their view for that of the banking regulator. The appellate tribunal's direction was therefore unsustainable and was set aside.

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Issues: Whether the Reserve Bank of India's one time settlement guidelines, issued through the Chief General Manager, had statutory force so as to create an enforceable right against the bank and justify a writ of mandamus directing settlement under those guidelines.

Analysis: The applicable statutory scheme under the Banking Regulation Act empowered the Reserve Bank of India to determine policy in relation to advances and to issue binding directions to banking companies in the public interest and in the interest of banking policy. The guidelines in question were not shown to have been issued by the Reserve Bank itself under any statutory authority, but by its Chief General Manager. In the absence of a statutory obligation created by those guidelines, they could not acquire statutory flavour. A writ of mandamus cannot be issued to enforce non-statutory instructions, particularly in contractual and banking recovery matters. The settled principle is that courts do not interfere with economic policy or substitute their view for that of the expert banking regulator unless a legally enforceable duty exists.

Conclusion: The one time settlement guidelines did not confer an enforceable legal right and no mandamus could be issued to compel their implementation. The direction of the Appellate Tribunal was unsustainable and was set aside.

Ratio Decidendi: Only directions or policy determinations of the Reserve Bank of India issued under statutory authority have binding force; non-statutory settlement guidelines do not create enforceable rights or duties and cannot be enforced by mandamus.

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