PIL on Islamic Banking
Excelsior Correspondent
JAMMU, July 26: In a Public Interest Litigation (PIL) seeking the introduction of Islamic Banking in Jammu and Kashmir, Division Bench of High Court comprising Chief Justice Pankaj Mithal and Justice Javed Iqbal Wani has held that court cannot enter into the realm of policy decision of the Government.
The PIL filed by an NGO namely J&K Peoples Forum in 2018 is seeking directions upon the Union Finance Ministry for issuing necessary notification for the introduction of Shariah compliant windows (Islamic banking) as recommended by Deepak Mohanty Committee as well as in the light of a report of the inter-departmental group of RBI.
The Forum also seeks direction to RBI for taking immediate steps in the constituent banks including the J&K Bank so as to facilitate Shariah compliant windows. The Forum wants J&K Bank Limited to place before the court entire details of Non Performing Accounts (NPAs) and the steps taken for recovery of the outstanding amount in NPAs, saying the same is public money which cannot be allowed to be misappropriated either by the account holders or by the management of the bank.
After hearing both the sides, the DB observed, “a counter affidavit has been filed on behalf of the Reserve Bank of India and it has been stated that in the year 2013, Ministry of Finance, Government of India had requested the Reserve Bank of India to give its opinion on introduction of Islamic Banking in India”.
“An interdepartmental group was constituted under the chairmanship of one Rajesh Verma to examine the feasibility of introducing Islamic Banking in India. The committee vide its report declined to introduce Islamic Banking, however, the Government appointed another committee headed by Deepak Mohanty in the year 2015 to look into the aspect”, the DB observed, adding “the committee in its report submitted to the Reserve Bank of India on 28.12.2015 made certain recommendations permitting interest free banking in certain respects but the report was not accepted by the Government”.
“The Government vide its letter dated 21.03.2017 specifically conveyed its decision that Islamic Banking is not feasible and Shariah Banking Window cannot be opened”, the DB further observed, adding “the decision of the Government is a policy decision which is beyond the purview of judicial review more particularly in a public interest petition”.
The DB held that the court cannot enter into the realm of policy decision of the Government. In case petitioner or any person is aggrieved by the policy decision it may take appropriate steps to challenge it before the proper forum, if advised. Accordingly, the PIL was disposed of.
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