Writ maintainability against regulatory inaction upheld where a statutory duty to act justified mandamus and parallel proceedings did not bar relief.

A writ petition under Article 226 was held maintainable where a public regulator vested with statutory supervisory powers and a corresponding duty was alleged to have failed to act against apparent regulatory breaches by a non-banking financial company. The Court treated the Reserve Bank of India's power to inspect, seek information and intervene in the public and depositor interest as amenable to mandamus, and held that parallel proceedings before the NCLT or NCLAT did not bar writ relief because those fora could not compel the regulator to exercise its own statutory powers. It also found that the learned Single Judge did not exceed jurisdiction or breach natural justice when issuing protective directions on the material already on record.

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Issues: (i) whether a writ petition seeking a direction to the Reserve Bank of India to exercise its statutory supervisory powers against a non-banking financial company was maintainable under Article 226; (ii) whether the learned Single Judge exceeded the scope of the maintainability application or violated natural justice by issuing protective directions.

Issue (i): whether a writ petition seeking a direction to the Reserve Bank of India to exercise its statutory supervisory powers against a non-banking financial company was maintainable under Article 226.

Analysis: The record showed admitted supervisory concerns regarding breach of leverage norms, non-submission of documents, and other regulatory irregularities in the affairs of the company. The statutory scheme of the Reserve Bank of India Act was treated as conferring powers on the regulator to inspect, require information, intervene, and take protective action in the public interest and in the interest of depositors. The Court held that where a public authority is vested with statutory power coupled with duty, a failure to act can be corrected through a writ of mandamus. The existence of proceedings before the NCLT or NCLAT did not oust writ jurisdiction because those fora could not compel the Reserve Bank of India to exercise its powers under its own statute.

Conclusion: The writ petition was maintainable and the challenge to maintainability failed.

Issue (ii): whether the learned Single Judge exceeded the scope of the maintainability application or violated natural justice by issuing protective directions.

Analysis: The pleadings and the material placed before the learned Single Judge had already brought on record the alleged regulatory violations and the risk to the corpus of the company. The parties had been heard on both maintainability and merits, and the directions were viewed as protective rather than a final adjudication of the main writ petition. The Court found no substance in the contention that the impugned order had been passed without hearing the appellant or beyond jurisdiction.

Conclusion: The learned Single Judge did not exceed jurisdiction and no violation of natural justice was found.

Final Conclusion: The appeal failed, and the impugned order upholding writ maintainability and permitting protective intervention remained undisturbed, while the parties were left free to pursue their remaining contentions in the main writ proceedings.

Ratio Decidendi: A writ of mandamus may issue under Article 226 where a statutory regulator, despite being vested with supervisory powers coupled with duty, fails to act against apparent regulatory violations, and parallel proceedings before another statutory forum do not bar such relief when that forum cannot grant the same regulatory direction.

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