ORDER
1. The instant writ application, which has been moved as a public interest litigation, is unique in the history of public interest litigation in this Court or perhaps in the entire country. Unlike the other public interest litigations, where normally any public spirited person or organisation comes before the Court for obtaining relief in favour of persons economically or socially oppressed and unable to approach the Court for vindication of their fundamental or legal right complaining against State action or inaction, in the instant case, the State itself has come up before this Court by way of public interest litigation championing the cause of the numerous small depositors of the three 'different residuary non-banking companies (hereinafter referred to as R.N.B.C.) and for vindication of their legal and constitutional rights. Its uniqueness, however, does not endwith the fact that here the petitioner is the State itself. It is also unique as in the instant application, State, being the petitioner complains against certains actions of the three R.N.B.Cs. and praying for reliefs against them which are admittedly not State or instrumentality of State or even authorities within the meaning of Art. 12 of the Constitution, but companies incorporated under the Companies Act. Such uniqueness of this petition provoked a legal debate as to the maintainability of the writ petition which continued for days, in which all the learned counsels whether for the writ petitioner or for the respondents participated with great ability rendering invaluable assistance to the Court and in which the finest quality of the learned counsels came out.
2. It is the case of the petitioner, State of West Bengal that it seeks to move the instant writ application on behalf of the countless small depositors of the respondent No. 2, M/s. Overland Investments Co. Ltd., respondent No. 6, Verona Commercial Credit and Investments Co. Ltd., and respondent No. 10, Sanchayani Savings (P) Investments Co. Ltd. all of which are residuary non-banking companies and incorporated under the Companies Act. It is contended by the petitioner that since the time of the case of Sanchaita Investments (State of West Bengal v. Swapan Kumar Guha, : 1982CriLJ819 ) the Supreme Court from time to time in its different judgments have been commenting on the mushrooming of different non-banking financial institutions including R.N.B.Cs. and in their alarming function in receiving large deposits from the members of the public and specially from ignorant small depositors having little capital of their own and the probability of syphoning of funds rendering the small depositors penniless depriving them of their live's savings and has been expressing hopes that the State and the Reserve Bank of India should take appropriate steps in public interest to safeguard the interest of such countless small depositors. Ultimately, the Reserve Bank of India in exercise of power under S. 45(3) of the Reserve Bank of India Act, 1934, issued the Residuary Non-Banking Companies (Reserve Bank) Directions, 1987(hereinafter referred to as 1987 Directions) in public interest and specially for safeguarding the interest of the small depositors. Under the said 1987 Directions the Reserve Bank of. India introduced a number of restrictions and requirements which the R.N.B.Cs. are required to follow, for the specific purpose of safeguarding interest of the small depositors and for their security. But now, from the Inspection Report of the Reserve Bank of India as also from the other Audit Report and also from Police Investigations Report, it appears that the aforesaid R.N.B.Cs. being the present respondents herein have been functioning in utter disregard and in violation of the various provisions of the aforesaid 1987 Directions and are also diverting crores of rupees to their subsidiary companies and to their directors jeopardising the interest of the small depositors and said R.N.B.Cs. have now reached such a situation that they are in the brink of a financial disaster and are unable to meet their total deposit liability and to pay back the small depositors their money taken by the said R.N.B.Cs. The details of such lapses on the part of the respondent No. 2, respondent No. 6 and respondent No. 10 have been set out in the writ petition, in the supplementary affidavit and in the additional supplementary affidavit and annexures thereto.
3. It is contended, on the basis of specific complaints, the police has started cases against the respondents Nos. 2 and 6 and their directors in which reports have been' submitted .
4. It is contended by the petitioner that it will appear from all such reports that the respondent No. 2 in clear violation of paragraph 6 of the aforesaid 1987 Directions, which requires investments of not less than 10% of the aggregate deposit liabilities in fixed deposits with Nationalised Banks and not less than 70% in uncumbered approved securities, and therefore, at least 44 crores out of total deposit liability of Rs. 58 crores was required to be invested in the aforesaid manner, only 3.87 crores have been so invested. The investment portfolio of the company during the last 3 years underwent a meta-morphic change, as a result of diversion of its investment from safe, secure and liquid assets to risk prone assets. The company had siphoned off sizeable sum of money to the tune of Rs. 667.25 lakhs in the guise of interest free loam and clean advances to its subsidiaries and group companies owned by Shri A. K. Bhowal and his family members. The company violated the provisions contained in paragraph 8 of the 1987 Directions relating to printed application form soliciting deposits; the company did not issue any advertisement soliciting deposits nor submit a statement in lieu of advertisement to the Bank as required under paragraph 16(2) of the 1987 Directions, the balance-sheet of the company did not reveal the actual liabilities as the company understated the liabilities in violation of the aforesaid 1987 Directions, by transferring a substantial portion of public deposits to Profit and Loss Account treating the same as income. The amount disclosed as deposit liabilities stood at Rs. 2,534.22 lakhs as on 31st March, 1993 as against the actual liabilities of Rs. 5, 799.59 lakhs. Thus, the amount of public deposit mobilised by the company up to March 31,1993 reduced to the extent of maturity paid had been understated by Rs. 3,265.37 lakhs in violation of the provisions of para 12 of the 1987 Direction. The company purchased innumerable number of plots of agricultural lands throughout the districts of West Bengal and in particular at Murshidabad and Burdwan districts. But the same could not produce the documents pertaining to land and buildings at Burdwan involving an amount to the tune of Rs. 151.36 lakhs. Nothing had been recorded in the Board meetings for involving such huge amount of money in landed properties. Funds were diverted to the various subsidiaries of the company by verbal order. Out of total amount of loans and advances amounting to Rs. 1010.05 lakhs, the subsidiaries and group companies of Overland Investment Ltd. enjoyed a sum of Rs. 667.26 lakhs i.e. 66.06% totally free of interest. The end-use of such funds tent to the subsidiaries and group companies was never ascertained. There are no papers or documents with the company for verifying details of such transactions.
5. In the case of Verona Commercial Credit and Investment Company Ltd., it was found inter alia from such reports that deposits liabilities have been understated by a sum of Rs.70 crores in violation of paragraph 12 of the 1987 Directions, the investment in uncumbered fixed deposit was nil as on 31-3-1993 as against requirement of Rs. 11.75 crores under para 6(1)(a)of the 1987 Directions; investment in approved securities was nil as against requirement of Rs. 82.31 crores under para 6(1)(b) of the 1987 Directions; that the sum of Rs. 1.73 crores was given to the Directors and their companies by way of loans and advances in support of which no document was forthcoming and no repayments were shown; that Rs. 14.66 crores were allegedly lent and advanced to the depositors, the details of which are not shown; no document could be produced in support of the claim that Rs. 9.21 crores was cash in hand in the audited balance-sheet for the year ended on 31-3-1994; in violation of para 7 of the 1987 Directions the company credited to the Profit and Loss Account Rs. 30.25 crores and Rs. 21.67 crores being the entire first year's subcription for the year ending with 31-2-1993 and 31-2-1992 respectively.
6. As regards the Sanchayani Savings Investment (P) Ltd., major findings in the said reports against the company are that as against the actual liability of Rs. 115 crores, liability disclosed in the aforesaid balance-sheet as on 31-3-1993 was shown as Rs. 95.23 crores; investment in approved securities was nil as on 31-3-1993; no receipts could be produced showing fixed deposits to the tune of Rs. 12.72 crores as per balance-sheet; no receipts produced for the alleged recurring deposits of Rs. 75 lakhs. Investment according to balance-sheet was only 11.04% as against the required rate of 80% in terms of paras 6(1)(a) and 6(1)(b) of 1987 Directions; in violation of para 5 of the said 1987 Directions the company did not allow interest in the case prematurity/surrender value of deposits; against the huge liability of Rs. 115 crores the paid up capital is a mere Rs. 1.52 lakhs; no materials were produced in support of investments in land and buildings; un-secured loans of Rs. 14 lakhs granted to the companies in which Directors are interested, total loss would amount to Rs. 20.27 crores if instead of 95% subscription liability, full amount of liability is taken into account.
7. It is being contended by the writ petitioner that it will appear because of such unsecured investment of the funds in violation of the various provisions of the 1987 Directions and diversion of funds to its subsidiaries and Directors, the interest of the small depositors of the said R.N.B.Cs. who mostly belong to the lower strata of the society have been seriously jeopardised. The said R.N.B.Cs. have now reached such a position that they are unable to pay back the loan taken from the small depositors and the said respondents are now in the brink of financial disaster; as a result the helpless small depositors are going to be deprived of their life's savings and money and consequentially the right to life of such depositors, which includes livelihood as guaranteed under Article 21 of the Constitution has been seriously affected. It is contended that the aforesaid 1987 Directions although contains various provisions for securing and safeguarding the money of the small depositors, the same does not contain any provision for recovery of the money in case of such misuse and diversion of funds by the R.N.B.Cs. or to compel them to pay back the money to the small depositors and the countless small depositors, who belong to weaker section of the community arc unable to approach the Court for seeking normal remedy available under the existing law for recovery of their money and they are not even aware about the impending financial crisis and disaster. It is contended that such helplessness of the countless small depositors and their inability to approach the Court are often taken advantage of by the R.N.B.Cs. who often create such a financial crisis to avoid repayment of the money to the small depositors. It is because of the aforesaid reasons, the State as the repository of the public interest has come forward to this Court by way of public interest litigation for appropriate relief in favour of such countless small depositors against the aforesaid R.N.B.Cs.
8. It has been contended by the petitioners that having regard to its constitutional obligation under Articles 38, 39, 39-A and 41 of the Constitution as also to the repeated observation of the Supreme Court in different cases that the State and the Reserve Bank should take appropriate steps for securing the interest of the depositors in such matters, the State of West Bengal has decided to move public interest litigation at this stage as it has come to a conclusion under the facts and circumstances of the case that if the situation is allowed to drift in its own course and allowed to be dealt with in the usual way, only the management of the aforesaid R.N.B.Cs. and better off investors will steal a march over the poor, ignorant and the helpless investors. In the prevailing situation if the aforesaid investors are left free to have their rights and obligations adjudicated upon and worked out in their separate and individual actions, there will inevitably be a situation, where the weaker sections of the people will be made to pay the more affluent sections. Under such consideration it has been decided by the State Government to beseech this Court to render justice, social and economic, by framing a positive and equitable scheme for refund out of amicable funds of deposits particularly to the countless small poor and ignorant investors who without such public assistance will be seriously affected in their enjoyment of lives by such unjust deprivation of their lives savings.
9. In the writ petition, the petitioners have freely quoted the observations of the Supreme Court in a number of cases being Sanchaita case (State of West Bengal v. Swapan Kr. Guha, : 1982CriLJ819 ) and the case of Peerless v. Union of India, reported in AIR 1987 SC 1023, where the Supreme Court had the occasion to consider in-depth the functioning of such Non-Banking Finance and Investment Institutions and commented inter alia that the character of business carried on by such companies is adventurous and precarious; most of such businesses are bound to face economic crisis and it is necessary for the authorities to evolve foolproof scheme to see that fraud is not allowed to be played upon persons who are notconversant with the practice of such financial enterprises; the State and the Central Government and the Reserve Bank of India must be given a reasonable opportunity to see if it is possible under the law to institute an enquiry into the affairs of the firm and in the meanwhile to regulate its affairs and some measures are essential in the interest of countless small depositors who otherwise will be ruined by being deprived of their live's savings. Similar observations of the Supreme Court in the case of Reserve Bank v. Timex Finance, reported in : 1991CriLJ1391 , where the Supreme Court was dealing with the legality and validity of the aforesaid 1987 Directions and examined the functioning of the R.N.B.Cs., where the Supreme Court referred to the abovementioned observations of Chinnappa Reddy and Khalid, JJ. of the Supreme Court, have also been quoted.
10. The petitioner has made an application for amendment of the prayers originally made in the writ petition. From the prayers made in the writ petition as also application for amendment, it appears that the petitioner has mainly prayed for appointment of a Commissioner or a Special Officer in respect of each of the respondent Nos. 2, 6 and 10 for taking charge and possession of all movable and immovable assets of the said three R.N.B.Cs.; their Bank Accounts; movable and immovable properties which realiy belonged to the said R.N.B.Cs. and diverted to the subsidiaries and sister concern and/or to their Directors or the dependants or the relatives or agent and employees; to carry out the necessary enquiry and investigation in that regard; attachment of all such properties; preparing a scheme for refund of the deposits along with dues accrued thereon to the depositors of the respondents Nos. 2, 6 and 10 and interim orders in respect thereof.
11. As in course of argument the writ petitioner, after having been served with an order passed by the High Court at Bombay, came to know that on the writ application of one Gaj Kumar Prabhakar Menokar and another, the Bombay High Court passed an injunction against the State of West Bengalrestraining the State which was one of the respondents in the said writ petition, from taking any such action like attachment of the property and appointment of Receiver against respondent No. 10 herein Sanchayani Savings Investment (1) Ltd. the petitioner has now prayed for an order of injunction restraining the respondents Nos. 11, 12 and 13 and the agents, officers and employees of the respondent No. 10, from dealing with, disposing of, transferring or encumbering the movable and immovable properties of the respondent No. 10 and also from operating any Bank Account standing in the name of the respondent No. 10 or any of its office? or branches. In view of such fact the prayer for appointment of Special Officer over properties, movable and immovables, of the respondent No. 10 is not pressed. It has now been prayed in the additional supplementary affidavit that a Special Officer may be appointed to take immediate charge and possession of the properties in the name of respondents Nos. 11,12 and 13 and also the properties standing in the name of agents, dependants, employees of respondents Nos. 11, 12 and 13.
12. The writ application was moved upon notice to all the respondents and at the-very admission stage, all the respondents, excluding the Union of India and Reserve Bank of India, challenged the very maintainability of the writ petition and urged before the Court to decide such question of maintainability as a preliminary point without filing of affidavits. This Court having accepted the aforesaid submission of the respondents that the question of maimainability of the writ petition should be considered as a preliminary point, the learned Counsels appearing for the various contesting respondents addressed the Court at length days together in support of their contention that this writ application is not maintainable and consequentially the relief asked for by the petitioners cannot be granted. The Reserve Bank of India and Union of India supported the writ application and the submissions of the learned Counsel for the petitioners. Since the maintainability of the writ petition was thus being considered as a preliminary point at the instance of therespondents, no direction for affidavit was called for and the Court proceeded on the basis of the pleading of the petitioner in the writ petition, supplementary affidavits, additional supplementary affidavit and application for amendment.
13. It has been contended on behalf of the respondents firstly that the writ petition is wholly misconceived and not maintainable as the State cannot maintain a public interest litigation as the State has no cause of action. The second preliminary objection raised by the respondents is that the controvercies involved in the present application cannot form the subject-matter of the writ petition far less the subject-matter of a public interest litigation. Thirdly, it has been contended by the respondents by way of preliminary objection that the writ application is not maintainable, as a public interest litigation can only be maintained against actions or inactions of the State and/or State authorities and not against R.N.B.Cs. which are the companies incorporated under the Companies Act. It has also been contended by way of preliminary objection that because of existence of alternative remedy under the Companies Act the public interest litigation cannot be maintained.
14. The maintainability of the writ petition, thus have been challenged in all its aspects.
15. In support of the first objection, namely, the State has no locus standi to move a public interest litigation, it has been contended by the respondents, that in a normal litigation undoubtedly the State could not have any locus standi to move this writ application not being aggrieved by the impugned action admittedly State not being a depositor having any right or interest against the private respondents. It has been further contended that if the nature of the public interest litigation is examined, it will appear that even in the public interest litigation the State has no locus standi to move the same. It has been argued inter alia that public interest litigation is intended to vindicate and effectuate public interest by prevention of violation of the rights, constitutional or statutory,or sizeable segments of the society, which owing to poverty, ignorance, social and economic disadvantages cannot themselves assert, their rights and quite often not even aware of those rights. Per Venkatachaliah, J. in Sheela Barse v. Union of India, reported in : AIR1988SC2211 . It has been further submitted on behalf of the respondent No. 7 that public interest litigation lies at the instance of some public spirited person and/ or association against Government and Governmental Agencies and in support of such contention the respondent No. 7 has relied again on the observation of Venkatachaliah, J. in Sheela Barse v. Union of India, para 6, wherein it has been observed that 'the grievance in a public interest action, generally speaking, is about the content and conduct of the governmental action in relation to the Constitutional or Statutory rights or segments of Society and in certain circumstances the conduct of governmental policies.'
16. Mr. Samaraditya Pal, learned Counsel appearing for the respondent No. 7 also took great pains in taking the Court through almost each and every decision of the Supreme Court on public interest litigation including the case of Janata Dal v. H. S. Chowdhury, reported in : 1993CriLJ600 , where the decisions reported in various public interest litigations are summarised and relying on such decision and particularly in the Janata Dal's case, it has been submitted that when the persons directly interested do not complain and do not express any grievance, then a third party even if it is the State cannot seek to champion their cause as a public interest litigation.
17. It has been submitted by Mr. Pal on behalf of the respondent No. 7 that the proposition that the State can also initiate Public Interest Litigation is absurd inasmuch as in that event the State would have to initiate Public Interest Litigation against itself to remedy the denial or non-fulfilment of rights of citizens by the State. It has been further submitted that the contention of the writ petitioners, inter alia that in view of the provisions of the Directive Principles of State Policy the State feels obliged to initiate thisPublic Interest Litigation to champion the cause of small depositor is misconceived as such Directive Principles of State Policy are only applicable in making laws.
18. On the aforesaid point namely the State cannot have any locus standi to move public interest litigation the respondent No. 2 after adopting the submission made on behalf of the respondent No. 7, has further contended relying on the decision of the Supreme Court in the case of State of Orissa v. Madan Gopal, : [1952]1SCR28 ; in the case of Veerappa v, Raman & Raman, : [1952]1SCR583 ; in the case of K. S. Rashid v. Income-tax Investigation Commission, : [1954]25ITR167(SC) ; and in the case of Calcutta Gas Company Ltd. v. State of West Bengal, : AIR1962SC1044 , that the petitioner has no locus standi and right to file the instant writ application or seek the reliefs sought for inasmuch as the petitioner in no way is aggrieved by the alleged impugned action. It was contended inter alia following the aforesaid decisions of the Supreme Court, the existence of right is foundation of exercise of jurisdiction of the High Court under Article 226 of the Constitution of India and, therefore, it is only at the instance of the aggrieved party appropriate writ can be issued.
19. It cannot be disputed, however, that the concept of Public Interest Litigation, which was initially unknown to our jurisprudence, is a product of recent judicial innovation through judicial activism with intention to bring justice within the reach of the persons, who constitutes the low visibility area of humanity and is economically and socially oppressed and, therefore, unable to approach the Court to vindicate their rights in public interest. The concept of public interest litigation because of the reasons aforesaid is a departure from the age-old concept of 'locus standi' and 'persons aggrieved' so long accepted by the Court. Under such newly innovated concept of public interest litigation which was introduced for the first time by the Apex Court of the land more or less in the decision reported in the case of S. P. Gupta v. Union of India, reported in : [1982]2SCR365 , any public spirited person or association is permitted to go before the Court in public interest to vindicate constitutional or legalright of a determinate class of the society, who are economically or socially oppressed and are unable to approach the Court themselves. The aforesaid concept of public interest litigation introduced by the Apex Court how now come to stay through a number of subsequent decisions of the Supreme Court as also of different High Courts of the country and in that view of the matter it is too late in the day to argue in a public interest litigation that the petitioner has no locus standi to move the application he not being aggrieved by the impugned action. The decisions of the Supreme Court, therefore, in the case of State of Orissa v. Madan Gopal, : [1952]1SCR28 , in the case of Veerappa v. Raman & Raman, : [1952]1SCR583 , in the case of K. S, Rashid v. Income-tax Investigation Commission, : [1954]25ITR167(SC) and in the case of Calcutta Gas Company Ltd. v. State of West Bengal, reported in : AIR1962SC1044 , all of which were arrived at by the Supreme Court prior to the innovation of the concept of public interest litigation and where the Supreme Court had no occasion, therefore, to deal with public interest litigation cannot be helpful in the instant case to determine preliminary objection raised by the respondents. Such decisions not being applicable at all in the instant case, the same may not engage our attention any further.
20. The first question, therefore, which has come up for determination by this Court relating to the aforesaid preliminary objection raised by the respondents is whether a public interest litigation can be initiated by the State when normally a public interest litigation is initiated by any public spirited person or association against omission or commission on the part of the State affecting the fundamental or legal right of a determinate class of persons who are unable to come before the Court.
21. Determination of this question is dependent on the understanding of the concept of the public interest litigation and the object, scope and extent thereof, which again can best be made by going through the different decisions of the Supreme Court on public interest litigation, where the Supreme .Court innovated, developed, nurtured and explained the concept of public interest litigation.
22. In the case of Mumbai Kamgar Sabha v. Abdulbhai Faizultabhai, reported in : (1976)IILLJ186SC , wherein the seed of the concept of Public Interest Litigation was first sown by Krishna Iyer, J., the Supreme Court held thus (at p. 1458 of AIR);--
'Our adjectival branch of jurisprudence, by and large, deals not with sophisticated litigants but the rural poor, the urban lay and the weaker societal segments for whom law will be an added terror if technical misdescrip-tions and deficiencies in drafting pleadings and setting out the cause-title create a secret weapon to non-suit a party. When foul play is absent, and fairness is faulted, latitude is a grace of processual justice. Test litigations, representative actions, pro bono publico and like broadened forms of legal proceedings are in keeping with the current accent of justice to the common man and a necessary disincentive to those who wish to by-pass the real issues on the merits by suspect reliance on peripheral, procedural shortcomings. Even Article 226, viewed in wider perspective, may be amenable to ventilation of collective or common grievances, as distinguished from assertion of individual rights, although the traditional view, backed by precedents has opted for the narrower alternative. Public interest is promoted by a spacious construction of locus standi in our socio-economic circumstances and conceptual latitudinarianism permits taking liberties with individualisation of the right to invoke the higher Courts where the remedy is shared by a considerable number, particularly when they are weaker. Less litigation, consistent with fair process, is the aim of adjectival law.'
23. In the case of Fertilizer Corporation Kamgar Union v. Union of India, reported in : (1981)ILLJ193SC , where the terminology of the public interest litigation was used for the first time, the Supreme Court held thus (at pp. 353-54 of AIR) :--
'We have no doubt that in competition between Courts and streets and dispenser of justice, the rule of law must win the aggrieved person for the law Court and wean him from the law-less street. In simple terms, locus standi must be liberalised to meet the challenges of the times. Ubi jus ibi remedium must be enlarged to embrace all interests of public minded citizens or organisations with serious concern for conservation of public resources and the direction and correction of public power so as to promote justice in its triune facets.
*** *** ****** *** *** The argument is, who are you to ask about the wrong committed or illegal act of the Corporation if you have suffered no personal injury to property, body, mind or reputation? An officious busybody picking up a stray dispute or idle peddlar or blackmail-litigation through abuse of the process of the Court cannot be permitted to pollute the Court instrumentality, for private objectives. Public justice is always and only at the service of public good, never the servant or janitor of private interest or personal motive.
Law, as I conceive it, is a social auditor and this audit function can be put into action only when someone with real public interest ignites the jurisdiction. We cannot be scared by the fear that all and sundry will be litigation happy and waste their time and money and the time of the Court through false and frivolous cases. In a society where freedoms suffer from atrophy and activism is essential for participating public justice, some risks have to be taken and more opportunities opened for the public minded citizen to rely on the legal process and not be repelled from it by narrow pedantry now surrounding locus standi.
*** *** ****** *** ***Public interest litigation is part of the process of participate justice and 'standing' in civil litigation of that pattern must have liberal reception at the judicial doorsteps.'.
24. In the case of S. P. Gupta v. Union of India, reported in : [1982]2SCR365 , the Supreme Court crystallised the concept of public interest litigation and explained the object, purpose, scope and limitation of the same by holding thus:--
'It may therefore now be taken as well established that where a legal wrong or a legal injury is caused to a person or to determinate class of persons by reason of violation of any constitutional or legal right or any burden is imposed in contravention of any constitutional or legal provision or without authority of law or any such legal wrong or legal injury or legal burden is threatened and such person or determinate class of persons by reason of poverty, helplessness of disability or socially or economically disadvantaged position, unable to approach the Court for relief, any member of the public can maintain an application for an appropriate direction, order or writ in the High Court under Article 226 and in case of breach of any fundamental right of such person or determinate class of persons, in this Court under Article 32 seeking judicial redress for the legal wrong or injury caused to such person or determinate class of persons. Where the weaker sections of the community are concerned, such as under-trial prisoners languishing in jails without a trial inmates of the Protective Home in Agra or Harijan workers engaged in road construction in the Ajmer District, who are living in poverty and destitution who are barely eking out a miserable existence with their sweat and toil, who are helpless victims of an exploitative society and who do not have easy access to justice, this Court will not insist on a regular writ petition to be filed by the public spirited individual espousing their cause and seeking relief for them. This Court will readily respond even to a letter addressed by such individual acting pro bono publico. It is true that there are rules made by this Court prescribing the procedure for, moving this Court for relief under Article 32 and they require various formalities to be gone through by a person seeking to approach this Court. But it must not be forgotten that procedure is but a handmaiden of justice and the cause of justice can never be allowed to be thwarted byany procedural technicalities. The Court would therefore unhesitatingly and without the slightest qualms of conscience cast aside the technical rules of procedure in the exercise' of its dispensing power and treat the letter of public minded individual as a writ petition and act upon it. Today a vast revolution is taking place in the judicial process, the theatre of the law is fast changing and the problems of the poor are coming to the forefront. The Court has to innovate the new methods and devise new strategies for the purpose of providing access to justice to large masses of people who are denied their basic human rights and to whom freedom and liberty have no meaning. The only way in which this can be done is by entertaining writ petitions and even letters from public spirited individuals seeking judicial redress for the 'benefit of persons who have suffered a legal wrong or a legal injury or whose constitutional or legal right has been violated but who by reason of their poverty or socially or economically disadvantaged position are unable to approach the Court for-relief. It is in this spirit that the Court has been entertaining letters for judicial redress and treating them as writ petitions and we hope and trust that the High Courts of the Country will also adopt this pro-active, goal-oriented, approach. But we must hasten to make it clear that the individual who moves the Court for judicial redress in cases of this kind mifst be acting bona fide with a view to vindicating the cause of justice and if he is acting for personal gain or private profit or out of political motivation or other oblique consideration, the Court should not allow itself to be activised at the instance of such person and must reject this application at the threshold, whether it be in the form of a letter addressed to the Court or even in the form of a regular writ petition filed in Court. We may also point out that as a matter of prudence and not as a rule of law the Court may confine this strategic exercise of jurisdiction to cases where legal wrong or legal injury is caused to a determinate class or group of persons or the constitutional or legal right of such determinate class or group of persons is violated and as far as possible, not entertained cases of individual wrong orinjury at the instance of a third party, where there is an effective legal aid organisation which can take care of such cases.'
25. In the case of Bandhua Mukti Morcha v. Union of India, reported in : [1984]2SCR67 , the Supreme Court held thus (Para 11) :--
'We are so much accustomed to the concepts of Anglo-Saxon jurisprudence which requires every legal proceeding including a proceeding for a high prerogative writ to be cast in a rigid or definitive mould and insist on observance of certain well settled rules of procedure, that we implicitly assume that the same sophisticated procedural rules must also govern a proceeding under Article 32 and the Supreme Court cannot permit itself to be freed from the shackles of these rules even if that be necessary for enforcement of a fundamental right. It was on the basis of this impression fostered by long association with the Anglo-Saxon system of administration of justice that for a number of years this Court had taken the view that it is only a person whose fundamental right is violated who can approach the Supreme Court for relief under Article 32 or in other words, he must have a cause of action for enforcement of his fundamental right. It was only in the year 1981 in the Judges Appointment and Transfer Case, : [1982]2SCR365 , that this Court for the first time took the view that where a person or class of persons to whom legal injury is caused by reason of violation of a fundamental right is unable to approach the Court for judicial redress on account of poverty or disability or socially or economically disadvantaged position, any member of the public acting bona fide can move the Court for relief under Article 32 and a fortiori, also under Article 226, so that the fundamental right may become meaningful not only for the rich and the well-to-do who have the means to approach the Court but also for the large masses of people who are living a life of want and destitution and who by reason of lack of awareness assertiveness and resources unable to seek judicial redress. This view which we took in the Judges Appointment and Transfer Case is clearlywithin the terms of Article 32 if only we look at the language of this Article uninfluenced and uninhibited by any pre-conceptions and prejudices or any pre-conceived notions. While interpreting Article 32, it must be borne in mind that our approach must be guided not by any verbal or formalistic canons of construction but by the paramount object and purpose for which this Article has been enacted as a Fundamental Right in the Constitution and its interpretation must receive illumination from the trinity of provisions which permeate and energise the entire constitution namely, the Preamble, the Fundamental Right, and the Directive Principles of State Policy. Clause (1) of Article 3 confers the right to move the Supreme Court for enforcement of any of the fundamental rights, but it does not say as to who shall have this right to move the Supreme Court nor does it say by what proceedings the Supreme Court may be so moved. There is no limitation in the words of Clause (1) of Article 32 that the fundamental right which is sought to be enforced by moving the Supreme Court should be one belonging to the person who moves the Supreme Court not does it say that the Supreme Court should be moved only by a particular kind of proceeding.
*** *** ****** *** ***We may point out that what we have said above in regard to the exercise of jurisdiction by the Supreme Court under Article 32 must apply equally in relation to the exercise of jurisdiction by the High Courts under Article 226, for the latter jurisdiction is also a new constitutional jurisdiction and it is conferred in the same wide terms as the jurisdiction under Article 32 and the same powers can and must therefore be exercised by the High Courts while exercising jurisdiction under Article 226. In fact, the jurisdiction of the High Court under Article 226 is much wider, because the High Courts are required to exercise the jurisdiction not only for enforcement of a fundamental right but also for enforcement of any legal right and there are many rights conferred on the poor and the disadvantaged which are the creation ofstatute and they need to be enforced as urgently and vigorously as fundamental rights.'
26. In the case of Bihar Legal Support Society, New Delhi v. Chief Justice of India, reported in : 1987CriLJ313 , the Supreme Court held thus (Para 2) :--
'Now, we may point out that so far as this Court is concerned, the special leave petitions of 'small men' are as much entitled to consideration as special leave petitions of 'big industrialists'. In fact, this Court has always regarded the poor and the disadvantaged as entitled to preferential consideration than the rich and the affluent, the businessmen and the industrialists. The reason is that the weaker sections of Indian humanity have been deprived of justice for long, long years: they have had no access to justice on account of their poverty, ignorance and illiteracy. They are not aware of the rights and benefits conferred upon them by the Constitution and the law. On account of their socially and economically disadvantaged position they lack the capacity to assert their rights and they do not have the material resources with which to enforce their social and economic entitlements and combat exploitation and injustice. The majority of the people of our country are subjected to this denial of access to justice and overtaken by despair and helplessness, they continue to remain victims of an exploitative society where economic power is concentrated in the hands of a few and it is used for perpetuation of domination over large masses of human beings. This Court has always, therefore, regarded it as its duty to come to the rescue of these deprived and vulnerable sections of Indian humanity in order to help them realise their economic and social entitlements and to bring to an end their oppression and exploitation. The strategy of public interest litigation has been evolved by this Court with a view to bringing justice within the easy reach of the poor and the disadvantaged sections of the community. This Court has always shown the greatest concern and anxiety for the welfare of the large masses of people in the country who are living a life of want and destitution, miseryand suffering and has become a symbol of the hopes and aspirations of millions of people in the country.'
27. In the case of Sheela Barse v. Union of India, reported in : AIR1988SC2211 , the Supreme Court held thus (Para 6):--
'In a public interest litigation, unlike traditional dispute-resolution-mechanism, there is no determination or adjudication of individual rights. While in the ordinary conventional adjudications the party structure is merely bi-polar and the controversy pertains to the determination of the legal consequences of past events and the remedy is essentially linked to and limited by the logic of the array of the parties, in a public interest action the proceedings cut across and transcend these traditional forms and inhibitions. The compulsions for the judicial innovation of the technique of a public interest action is the constitutional promise of a social and economic transformation to usher-in an egalitarian social order and a welfare-State. Effective solutions to the problems peculiar to this transformation are not available in the traditional judicial system. The proceedings in a public interest litigation are, therefore, intended to vindicate and effectuate the public interest by prevention of violation of the rights, constitutional or statutory, or sizeable segments of the society, which owing to poverty, ignorance, social and economic disadvantages cannot themselves assert and quite often not even aware of those rights. The technique of public interests litigation serves to provide an effective remedy to enforce these group-rights and interests. In order that these public causes are brought before the Courts, the procedural techniques judicially innovated specially for the public interest action recognises the concomitant need to lower the locus standi thresholds so as to enable public minded citizens of social action groups to act as conduits between these classes of persons of inherence (sic) and the forum for the assertion and enforcement of their rights. The dispute is not comparable to one between private parties with the result there is no recognition of the status of a Bo minus-Litis for any individual or group ofindividuals to determine the course or destination of the proceedings, except to the extent recognised and permitted by the Court.'
28. In the case of Janata Dal v. H. S. Chowdhury, reported in : 1993CriLJ600 , where the different decisions of the Supreme Court in public interest litigations were summarised, the Supreme Court tried to define the public interest litigation by holding thus:--
'Therefore, lexically the expression 'PIL' means a legal action initiated in a court of law for the enforcement of public interest or general interest in which the public or a class, of the community have pecuniary interest or some interest by which their legal rights or liabilities are affected.'
29. In the said judgment the Supreme Court also quoted with approval the following definition of Public Interest as contained in Strouds Judicial Dictionary and Black's Law Dictionary.
30. In Strouds Judicial Dictionary,Vol. IV (4th Edn.) 'public interest' is defined thus:
'Public Interest--1. A matter of public or general interest does not mean that which is interesting as gratifying curiosity or a love of information or amusement; but that in which a class of the community have a pecuniary interest, or some interest by which their legal rights or liabilities are affected.' (Per Cam-bel,CJ., in R. v. Dedfordshire (18S5) 24 LJQB 81).)
31. In Black's Law Dictionary (6th Edn.), 'public interest' is defined as follows :--
'Public Interest -- Something in which the public, the community at large, has some pecuniary interest, or-some-interest-by which their legal rights or liabilities are affected. It does not mean anything so narrow as mere curiosity, or as the interests of the particular localities, which may be affected by the matters in question. Interest shared by citizens generally in affairs of local, State or national Government......'
32. Examination of the various decisionsof the Supreme Court on Public Interest Litigation right from the case of S. P. Gupta v. Union of India, : [1982]2SCR365 will reveal that public interest litigation is an outcome of judicial activism and it is ajudicial innovation for ensuring rendering of social and economic justice to the under-privileged and the Supreme Court while nurturing such concept in the case of S. P. Gupta v. Union of India and later on developing and extending the same in subsequent decisions, time and again has recorded that the concept of public interest litigation is still in the process of evolution and while laying down the basic norms and the guidelines of such public interest litigation the Supreme Court has also accepted the fact that there may be public interest litigation of a nature different from one which is commonly faced.
33. In the case of Sheela Barse v. Union of India, : AIR1988SC2211 , the Supreme Court was of the view that in public interest litigation both the party structure and the matters in controversy are sprawling and amorphous, to be defined and adjusted or readjusted as the case may be, ad hoc, according as the exigencies of the emerging situations; the relief to be granted looks to the future and is, generally, corrective rather than compensatory which, sometimes, it also is. The pattern of relief need not necessarily be derived logically from the rights asserted or found. More importantly, the court is not merely a passive, disinterested umpire or onlooker, but has a more dynamic and positive role with the responsibility for the organisation of the proceedings, moulding of the relief and this is important also supervising the implementation thereof.
34. Thus in the Janata Dal v. H. S. Chowdhury's case, : 1993CriLJ600 , the Supreme Court held thus (Paras 59 and 66):--
'Though it is imperative to lay down clear guidelines and propositions; and outline the correct parameters for entertaining a Public Interest Litigation particularly on the issue of locus standi, yet no hard and fast rules have yet been formulated and no comprehensive guidelines have been evolved. There is alsoone view that such adumberation is not possible and it would not be expedient to lay down any general rule which would govern alt cases under all circumstances.
*** *** ****** *** ***Though we have, in our country, recognised a departure from the strict role of locus standi as applicable to a person in private action and broadened and liberalised the rule of standing and thereby permitted a member of the public, having no personal gain or oblique motive to approach the Court for enforcement of the constitutional or legal rights of socially or economically dis-advantaged persons who on account of their poverty or total ignorance of their fundamental rights are unable to enter the portals of the courts for judicial redress, yet no precise and inflexible working definition has been evolved in respect of locus standi of an individual seeking judicial remedy and various activities in the field of PIL. Probably, some reservation and diversity of approach to the philosophy of PIL among some of the Judges of this Court as reflected from the various decisions of this Court, is one of the reasons for this Court finding it difficult to evolve a consistent jurisprudence in the field of PIL. True, in defining the rule of locus standi no 'rigid litmus test' can be applied since the broad contours of PIL are still developing space seemingly with divergent views on several aspects of the concept of this newly developed law and discovered jurisdiction leading to a rapid transformation of judicial activism with a far-reaching change both in the nature and form of the judicial process.'
35. The reason is obvious. On the face of vast revolution that takes place in the judicial process, the theatre of the law is fast changing and the problems of the poor are coming to the forefront. (As observed by the Supreme Court at para 17 in the case of S. P. Gupta v. Union of India, : [1982]2SCR365 ) and to face such a challenge the Court is required to innovate new methods and devise new strategies for the purpose of providing access to justice to large masses of people who aredenied their basic human rights and to whom freedom and liberty have no meaning. The public interest litigation is one of such judicial innovations to meet such challenge. In public , interest litigation the concept of locus standi and 'person aggrieved' is relaxed and petitions even at the instance of the third parties are accepted championing the cause for the determinate class of people socially or economically oppressed and who are unable to approach the Court for protection of their fundamental or other legal right. Under such circumstances, there cannot be a rigid form, invariable structure or unalterable field and fact situation of a public interest litigation.
36. Thus when even a public spirited person or association not having normally any locus standi to move a petition can be allowed to move a public interest litigation in public interest for vindication and protection of the constitutional or legal right of a determinate and oppressed class unable to approach the Court, in my view there cannot be any justification whatsoever to deny such right to the State itself in a fit and proper case to move public interest litigation for protection and vindication of the legal and constitutional right of the underprivileged and of a determinate class of persons who are unable to approach the Court who sometimes are not even unaware of their rights to save themselves from exploitations. It is now the consistent view of the Supreme Court that every action of the State is for public interest and must be for public good and therefore every action of the State is to be tested in the touchstone of the Article 14 of the Constitution. Thus if every action of the State is to be for public interest and for public good, the State can safely be said to be repository of public interest. Under such circumstances if by the impugned action of a body or person amenable to writ jurisdiction complained of, the right and interest of a determinate oppressed class unable to approach the Court, is affected, the State can also be allowed to maintain a public interest litigation in a fit and proper case, particularly in absence of suitable legislation and inability to legislate in the particular field, to protect and vindicate the rights of such determinate classbefore the Court of law and if the basic ingredients of the public interest litigation are found to be present, the application cannot be thrown out at the threshold merely on the ground the petition has been moved by the State.
37. In a public interest litigation, in my view, the emphasis has to be on the object and purpose of the same, namely rendering of social and economic justice to the weak and underprivileged and vindication and protection of their rights and interest they being unable to approach the Court, and not on the person who sets the Court on motion. Any person should be allowed to move the Court, except a busy body, interloper, person having his own interest, publicity seeker etc. The emphasis in the instant case being protection of the rights and interest of the countless small depositors who belong to the weaker section of the society and are unable to approach the Court themselves and to rescue them from their financial ruination, and deprivation of life's savings, there is no reason why State should not be permitted to take up their cause by way of public interest litigation, when the 1987 Direction and the Reserve Bank of India Act, do not contain any provision for rescuing the small depositors from financial ruination by return of their money with dues accrued thereon by the R.N.B.Cs. who have violated the provisions of the 1987 Directions and when it is beyond the competence of the State of West Bengal to bring about any legislation in respect thereof.
38. The submission of Mr. Pal that to permit the State to move a public interest litigation will be an absurd proposition inasmuch as the same would mean that the State is complaining against its own omission or commission, is not tenable. Such submission in my view, obviously emanates from the erroneous conception of the public interest litigation namely that a public interest litigation can be initiated only against State actions or inactions although no such proposition has been laid down in the different decisions of the Supreme Court and the other High Courts in public interest litigations. This point however will be dealt with in detailhereinafter as this is also one of the grounds on which the maintainability of the writ petition has been challenged.
39. This now takes us to the next point of the preliminary objection taken by the respondents namely in any event, the petitioner cannot obtained relief as it is seeking the same against respondents R.N.B.Cs. which are companies incorporated under the Companies Act and are not either State or instrumentality of the State or even an authority within the meaning of Art. 12 of the Constitution and therefore not even amenable to writ juris diction.
40. The submission of Mr. Mukherjee appearing for the petitioner, on the other hand is that even in an ordinary course of event writ lies'even against a person, or body of persons even though the same is not State or instrumentality of the State or an authority within the meaning of Art. 12 of the Constitution, if such a person performs statutory duty or is invested with certain statutory obligations or such a person is performing any public duty or invested with public obligations or duty. It has been submitted on behalf of the petitioner that the fact, 1987 Direction was promulgated for public interest and for protection of the interest of infinite number of small depositors is not beyond any dispute and has been declared to be so by the Supreme Court in the Timex Case, : 1991CriLJ1391 . The respondents, R.N.B.Cs. therefore, because of such 1987 Directions have public obligation and duty to carry on their business only after fulfilling such, public obligation and duties for the protection of the interest of the small depositors, but they not having fulfilled such public duties, obligations but actually having violated them, which has resulted in jeopardising the interest and the legal and constitutional right of the small depositors, even in an ordinary circumstances, a writ would have been maintainable against such R.N.B.Cs. and therefore there is no reason why in a public interest litigation writ cannot be maintained against such a company.
41. Mr. Pal, appearing for the respondent No. 7 in support of his submission that thepublic interest litigation can lie only against the Government and governmental agencies has relied in the decision of the Supreme Court in the case of Sheela Barse v. Union of India reported in : AIR1988SC2211 as also in the case of Janata Dal v. H. S. Chowdhury reported in : 1993CriLJ600 . Mr. Palhas relied on the observations of Venkatachaliah, J. (as the Hon'ble Chief Justice was then) in the case of Sheela Barse to the effect (para 11 of the judgment) that the grievance of the public interest action generally speaking is about the content and conduct of the Government and governmental agencies in relation to the constitutional or statutory rights and segments of society and in certain circumstances the conduct of Government policies.
42. Although Mr. Pal wants this Court to accept the said observations of the Supreme Court as conclusive pronouncement of law that a public interest litigation lies only against the Government and governmental agencies, I am unable to do so. The reference to the aforesaid observations in the aforesaid case of Sheela Barse, clearly indicates that it was never observed by his Lordship that no public interest litigation can be maintained except against Government or governmental agencies. But it was observed by his Lordship that 'generally speaking' grievance in a public interest action is about the content and conduct of the Government action in relation to constitutional or statutory rights of segments of society and in certain circumstances . the conduct of Government policies. The expression used by his Lordship while making such observations to the effect 'generally speaking' can hardly be ignored and the same clearly indicates that generally a public interest action is brought against governmental action. But the very next sentences in the said paragraph makes it abandonedy clear that there is no hard and fast rule in public interest litigation that it can lie only against Government or governmental action, on the contrary, both the party structure and the matters in controversy are sprawling and amorphous to be defined and adjusted or readjusted as the case may be, ad hoc, according to exigencies of the emergingsituation. The entire relevant portion of the aforesaid para 11 of the said judgment may be quoted hereunder:--
'In a public interest litigation, unliketraditional dispute resolution mechanism,there is no determination or adjumcation ofindividual rights. While in the ordinaryconventional adjudications the party structure is merely bi-polar and the controversypertains to the determination of the legalconsequences past events and the remedy isessentially linked to and limited by the logic ofthe array of the parties, in a public interestaction the proceedings cut across and transcend these traditional forms and inhibitions.The compulsion for the judicial innovationthe technique of a public interest action is theconstitutional promise of a social and economic transformation to usher in an equali-tarian social order and a welfare State. Thedispute is not comparable to one betweenprivate parties with the result there is norecognition of the status of a dominus litis forany individual or group of individuals todetermine the course or destitution of theproceedings, except to the extent recognisedand permitted by the Court. The 'rights' ofthose who bring the action on behalf of theother must necessarily be subordinate to the'interests' of those whose benefit the action isbrought. The grievance in a public interestaction, generally speaking, is about thecontent and conduct of Government action inrelation to the constitutional or statutoryrights of segments of society and in certaincircumstances the conduct and Governmentpolicies.-Necessarily, both the party structureand the matters in controversy are sprawlingand amorphous, to be defined and adjusted orreadjusted as the case may be ad hoc'.according as the exigencies of the emergingsituations The proceedings do not partake ofpredetermined private law litigation modelsbut are exigenously determined by variationsof the theme'. '
43. It has also been submitted on behalf of the respondent No. 7 in support of the contention that the public interest litigation can lie only against the action of the Government or governmental agencies, that in thecase of Janata Dal v. H. S. Chowdhury : 1993CriLJ600 (supra) all the cases which the Supreme Court referred to in the said judgment while summarising the law of public interest litigation involved public interest litigation against State action.
44. In all the cases however State action was not complained of. In Asiad case : (1982)IILLJ454SC the complaint was against the action of the contractors in depriving the labourers of their right.
45. That apart, in my view, however, the fact that in most of the different public interest litigations referred to by the Supreme Court in the said case involved public interest litigation against the Slate action or inaction, can hardly be treated as a pronouncement of law by the Supreme Court to the effect that no public interest litigation can lie except against the action of the Government or governmental agencies, particularly, when in none of the decisions it has ever been laid down by the Supreme Court, that public interest litigation cannot lie except against the Government action or inaction or against the Government agencies. On the contrary, the following observations of the Supreme Court in the aforesaid case of Janata Dal : 1993CriLJ600 will indicate that in defining the rule of locus standi no rigid litmus test can be applied as the law is still developing:
'Though we have, in our country, recog