Right to Information
Arrogant SEBI’s response to RTI is shocking

SEBI once again adopts an anti-investor attitude by flatly rejecting an RTI on the basis that it “would lead to diversion of the resources of the public authority”, which according to a former CIC, is absurd and untenable

Shailesh Gandhi, former Central Information Commissioner (CIC), is shocked to hear of Securities Exchange Board of India (SEBI) refusal to give information to Moneylife’s Right to Information (RTI) application. Mr Gandhi said, “The information sought which SEBI claims it is on its website, hence using Section 7(9) of RTI Act is absurd. Section 7(9) cannot be a ground for denial of information. SEBI PIO is completely wrong. It is unfortunate that the SEBI PIO is taking such an untenable position.” Moneylife had filed an RTI seeking information on portfolio management services (PMS), in electronic format. Rather than simply providing PMS information on a CD or pen drive, SEBI refused to give information by invoking Section 7(9) of the RTI Act and stated: “PMS Monthly report has already been uploaded on the SEBI website and is therefore in public domain. Collating the information and providing the same to you would lead to diversion of the resources of public authority.”
 

Section 7(9) of the RTI Act states: “An information shall ordinarily be provided in the form in which it is sought unless it would disproportionately divert the resources of the public authority or would be detrimental to the safety or preservation of the record in question.” Does this mean that merely giving information on a CD or a pen drive would “lead to diversion of the resources” or for that matter “be detrimental to the safety” of the records? If SEBI wants to maintain that the information sought is on their (extremely slow) website, what prevents them from providing the same upon inspection or even upon payment for CD?
 

Earlier, SEBI had uploaded information, on PMS companies, in a manner that was inaccessible and did not allow comparison of the performance of various schemes. This was also in response to a Moneylife RTI which we had fought hard for over a year. Not only is the site frustratingly slow, the information is not downloadable. At this rate, it is simply not feasible for a common investor to compare 250 PMS companies within an hour let alone a single day. It will take the average investor weeks to collect ‘incomplete’ information of just 100 PMS companies. It is pertinent to note that SEBI has not uploaded long-term performances of PMS companies on their website, and therefore information is ‘incomplete’. For more details on this, you can access our full exclusive story here: SEBI’s system of reporting PMS data continues to be frustratingly anti-investor. This prompted us to visit SEBI’s premises and seek for entire PMS information in electronic format (i.e. CD or pen drive).
 

Moneylife team visited the premises of SEBI to seek information of PMS companies in electronic format. Upon visiting the premises we did not meet the public information officer (PIO). Instead, the Assistant General Manager, SEBI, Aman Jain, met us but had little or no clue about Section 4. He didn’t know if SEBI had the information on PMS companies in electronic format. He asked us to file a fresh RTI, under Section 6, which we did.
 

SEBI not only did not entertain an onsite inspection of records (i.e. Section 4), it also stonewalled our fresh RTI application (Section 6) in which SEBI has shockingly refused to give information in CD format, citing that the information sought after was very “vague and not specific”! (In our RTI application, we were very specific and even cited the link where information was kept—http://www.sebi.gov.in/sebiweb/investment/PMRReport.jsp). They went on invoke Section 7(9) of the RTI Act.
 

Nagesh Kini, a prominent social activist, says, “This is total contradictory to the way BrihanMumbai Municipal Corporation (BMC) functions, which is friendly when it comes to providing information. They even entertain the public under Section 4 of the RTI Act. They provide you a room, table and all the material and files, allow you to mark the documents you want copied and even provide you with the Xerox facility.” According to a recent news report, the BMC fields the largest number of RTIs in the state, with nearly 1.02 lakh applications, or 16% of the total RTIs filed in Maharashtra.
 

Section 4 of the RTI Act, and its sub-sections, clearly state that information should be easily accessible and should be even provided in the format or medium it has been sought.
 

Section 4(4) states: “All materials shall be disseminated taking into consideration the cost effectiveness, local language and the most effective method of communication in that local area and the information should be easily accessible, to the extent possible in electronic format with the Central Public Information Officer or State Public Information Officer, as the case may be, available free or at such cost of the medium or the print cost price as may be prescribed.” (emphasis ours)
 

Section 4(3) states:  "For the purposes of sub-section (1), every information shall be disseminated widely and in such form and manner which is easily accessible to the public."

Explanation.—For the purposes of sub-sections (3) and (4), ‘disseminated’ means making known or communicated the information to the public through notice boards, newspapers, public announcements, media broadcasts, the internet or any other means, including inspection of offices of any public authority.”(emphasis ours)
 

Section 4(1) of the RTI Act, 2005 states: “Every public authority shall maintain all its records duly catalogued and indexed in a manner and the form which facilitates the right to information under this Act and ensure that all records that are appropriate to be computerised are, within a reasonable time and subject to availability of resources, computerised and connected through a network all over the country on different systems so that access to such records is facilitated.”
 

Furthermore, Section 4(2) states: “It shall be a constant endeavour of every public authority to take steps in accordance with the requirements of clause (b) of sub-section (1) to provide as much information suo motu to the public at regular intervals through various means of communications, including internet, so that the public have minimum resort to the use of this Act to obtain information.”
 

The fact that SEBI refused to provide information under both Section 4 and Section 6 shows the callous attitude of the market regulator towards consumers and Indian citizens. In the meantime, investors will need to spend over one week just to obtain (incomplete) information on PMS companies on SEBI’s excruciatingly slow website.
 

Moneylife plans to file a first appeal.

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COMMENTS

Mahesh Khanna

4 years ago

It is not shocking that SEBI arrogance in reply to RTI application.It is become a practice of CPIO's of various regulatory authorities to avoid giving replies to RTI Application.
Slowly and steadily the RTI is losing its sting and is dying a premature death.The CPIO's are aware that it is easy to frustrate the applicant by giving the information,since it would take more than one year till the final disposal of his appeal before the CIC.

Sandeepan Bose

4 years ago

I have'nt gone through all the reports for all the institutions but it appears there are very few individuals / institutions that us the PMS facility. Originally the lower limit for participation in PMS for individuals was 10 lacs which was increased to 25 lacs .... apparently Finanace Ministry wanted to limit the exposure of people to risk or rather found this a headache for governanace. I guess these funds do not have the acumen that Hedge Funds have globally ... that is what I conclude by the low participation. Anybody has anty idea how these schemes perform ?

REPLY

sathyacumaran

In Reply to Sandeepan Bose 4 years ago

its not pms under the guide of pms all the investors fund is misused by the stock broker if the investor is online client his account is mapped in offline and viceversa this racket is main business of most of the stock broker and loss is booked to investors and profit is booked to broking house we donot know whether there with in the stock broking house the trading without nse bseand sebi knowledge as an whole once this scaM COMES OUT IN MEDIA THIS WOULD BE INDIA BIGGEST SCAM SINCE INDEPENDENCE BUT THIS WOULD BE FINAL CALL FOR INDIAN STOCK MARKET AND PEOPLE WOULD DESIST FROM INVESTING IN THE MARKET HENCE THE DELAY


SATHYA CUMARAN

sathyacumaran

4 years ago

ITS HIGH TIME THAT THE GOVT SHOULD TIGHTEN THE BELTS OF GOVT INSTITUTIONS SUCH SEBI NSE BSE FROM THE HANDS OF CORRUPTION BECAUSE THE POLITICAL CORRUPTION COULD BE CURTAILED BY ELECTION PROCESS BUT THE OFFICIAL CORRUPTION IS LIKE AN LEACH AND THIS WOULD GO GOVT AFTER GOVT AND THEY WOULD NOT BE QUESTIONED EVEN IF THEY ARE QUESTION THEIR COLLEGUE WOULD COME FOR SUPPORT AND IF AT THEY WOULD GO FOR VRS AND SAME RETIREMENT BENEFITS WOULD BE GIVEN SO INORDER TO CURB THE INSTITUTIONAL CORRUPTION THE OFFICIALS SHOULD BE STRICTLY PUNISHED AND RULE SHOULD BE DRAFTED IN SUCH MANNER THAT THEIR RETIREMENT BENEFITS IS CURBED AND FURTHER THEY SHOULD NOT REEMPLOYED IF THE RULE IS BROUGHT THEN ONLY INDIAN ADMINISTRATION COULD KEEP UP IT DIGINITY OTHERWISE WE AS AN JOURNALIST WE HAVE EXPOSE THIS ADMINISTRATIVE LAPSES BEFORE MEDIA AND CHANNEL AND THIS WOULD BE BEGINING AND SERIES OF OTHER DEPARTMENT WOULD FOLLOW


SATHYA CUMARAN

uttamkumar dubey

4 years ago

All the above plights points to poor governance and completely Opaque-irresponsible and unaccountable situation.

And the root cause lies in the weak or no will power by our Legislative bodies,judiciary,and media.

So please discourage this Congress-BJP nexus, and come out openly with family and friends (Keeping ones useless ego or sickness at home)to support Kejriwal. Please give him a clear mandate, anyways he may not be worse than congress-bjp.

Moneylife, request you to pls. extend your support to kejriwal news and views and connect him to this forum.

Your goals are no different from him.

rgds,
uttam

RAMESH VASWANI

4 years ago

We totally agree with your contention, and the matter must be continued to be taken up to its logical conclusion.

All the Best.

sathyacumaran

4 years ago

sebi not only answering to RTI but they donot do justice to the investor what ever complaints we lodged its never heard at all as this only insitution for indian investor they are stuck with sebi arrogant attitude nobody even bother to look into any case lodged with by individual investors as such we feel our basic legtimate right of representation had been misused by sebi we are not sure whether we are in an democractic country or dicatator because sebi and nse bse act as agent of stock brokers in india and infact the employees of sebi nse bse are just puppets in the hands of stock brokers and all the case lodged by stock broker is promptly heard and result is delivered in their favour because after the retirement of sebi or nse bse officials these eretired employees get placed in these broking firms with good position with fat salary apart from pension which they get apart from fringe benefits they derived during their tenure we are not hear to find fault with sebi or nse bse but we are helpless ingetting justice so this comment

sathya cumaran

mm sundram

4 years ago

after all what will be amount the sebi going to spent for providing this and how it will amount the diversion of resources. nobody in the sebi attending the phone in the morning from 10 to 12.30AM and evening after 3.30PM and inbetween the lunch time is one hour. SEBI wasting and spending the hard earned monies from the TAX payers and of course this info which sought for only the TAX paying public and what the sebi officials going to lose. WE should protest vigorously for this callous attitude.,

VK

4 years ago

Being reasonably familiar with many website technologies and backends, it will be good for one to be curious and investigative on how exactly they maintain integrity of their webpage contents, how they manage their content updates, and how such processes they do are audit worthy for reliably referencing the website contents on a given calendar date in the past. My 2p of inputs just in case it is useful. Regards, VK

Pradeep R Hattangadi

4 years ago

The reaction is because Moneylife has caught SEBI with its pants down. What you have asked may not even in the realm of the thinking of the people working in SEBI

Siva

4 years ago

Oh yes, as if they are coming down heavily on insider trading & other malpractices which are rampant in the markets. This needs to be labeled as the most stupid and absurd response a PIO can come with. I hope the other govt agencies haven't noticed this response. If SEBI takes such a stance, a day is not far when a Mutual fund would say that it cannot process my redemption request since it cannot divert any of its personnel for processing the claim.

~My sincere plea to the govt., please scrap this RTI sham. It will save a lot of blushes for you and your citizens. RTI is only leading to anguish and frustration. We are better off not knowing the rot and arrogance of the system
~~ Have recently filed an RTI with RBI. Have a feeling that Section 8(1) will be quoted even though there is a CIC order against the use of the same for that specific info.
~~~Mangoman from a truly truly banana republic.

Nilesh KAMERKAR

4 years ago

Perhaps, one of the most non-serious players in the Indian Capital Markets.

You Be The Judge

Relying on Eyewitness

Mr and Mrs Twichell lived in a house next to the street.
One night, Mr Twichell killed Mrs Twichell. Mr Twichell was convicted and executed. Justice done? Yes? No? Maybe? Here is more of the story.

Mr Twichell hit his wife on the head while they were in the bedroom. She died instantaneously. Mr Twichell then dragged her body to the front room. There he planned an alibi. He bent a poker and covered it with her blood. He then opened the front door and went back to bed. Made it look like some outsider had done the deed.

The next morning, the house-maid went to the front room, as she did every morning, and found the corpse. She ran out onto the road, screaming.

On her story, Mr Twichell was arrested and tried. The maid said that as soon as she found the body, she OPENED the front door and ran out. This meant that only a person staying inside the house could have murdered Mrs Twichell. Mr Twichell was duly convicted and sentenced to death.


 Now it so happens that, in many studies carried out in strictly controlled circumstances, witnesses never agree on what they actually saw. Not even 50% of the witnesses to an incident can even remember, or agree upon, the colour of the clothes the person, or persons, were wearing. Memory can play peculiar tricks and most witnesses, especially after prolonged periods, tend to testify to what they sincerely believe. They genuinely think that they are repeating the honest-to-goodness truth.

In this case, while awaiting his execution in jail, Mr Twichell confessed to his lawyer that he had left the door open and that the maid was not giving the correct story. Obviously, Mr Twichell himself could not have countered her testimony! The later consensus was that as the maid was so used to opening the door every morning, she imagined that she had done the same that day too. She was a creature of habit as we all are. If we take the left turn out of our home every morning, do we not do that instinctively even on that one day we have to turn right?

Now, you be the judge.
A murderer, admittedly a self-confessed one, is tried, convicted and executed. Is justice done? Especially when a man loses his life on false testimony?

To our mind, it was a wrong conviction of the right person. The correct option would have been for the lawyer to bring this point to the attention of the court which would then have recorded Mr Twichell’s testimony, such a confession being a valid one that can be used as evidence in a trial. He could then have been convicted on the basis of new testimony to avoid being set free on the plea of double jeopardy. We would have ordered a mis-trial. In matters of justice, the end cannot justify the means. It is for the judge to sift between truthful testimony, perjury and mistaken beliefs. It is a tough job; but it has to be done.

Now, this case brings to the fore the many subtleties in such instances. Was the maid really, and honestly, mistaken or was she put up by the prosecution to mouth this story? After all, this happened more than a hundred years ago when legal niceties were as rare as hen’s teeth.

Did the door slam itself shut with the wind at night? Did
Mr Twichell, in his anxiety to speed up the cover-up, actually forget to leave the door open and go back to bed believing he had? Did some passer-by, seeing the door ajar, shut it as an act of service?

For those interested in the frailties of the human mind and the tricks it can play, Psychology and the Day’s Work by Prof Edgar James Swift, amongst others, will be interesting.

Our story, however, does not end here. TWICHELL DID MANAGE TO CHEAT THE HANGMAN. His friend, a chemist, smuggled some very potent poison into the prison and Mr Twichell took it. And he, too, died instantaneously. Now, you be the judge. What would you have done to the chemist?

Bapoo Malcolm is a practising lawyer in Mumbai. Please email your comments to [email protected] or [email protected]

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COMMENTS

prakash nandedkar

4 years ago

a very thought provoking

Hero MotoCorp picks up 49.2% stake in Erik Buell Racing

The move is a part of the Indian two-wheeler major’s strategy to enhance technological prowess, post the break up of the erstwhile joint venture with Honda—Hero Honda

India’s largest two-wheeler maker Hero MotoCorp today said it has picked up 49.2% stake in US-based Erik Buell Racing (EBR) for $25 million (about Rs148 crore).

 

The company has incorporated a wholly-owned subsidiary in the US by the name of HMCL (NA), Inc for the purposes of investing in Erik Buell Racing, Inc, Hero MotoCorp (HMC) said in a filing to the BSE.

 

“HMCL(NA) has agreed to invest $25 million in EBR for a total stake of 49.2% in the share capital of EBR. The first tranche of $15 million has been invested by HMCL (NA) on 28 June 2013,” it added.

 

The second tranche of $10 million is proposed to be invested within the next nine months, the company added.

 

The company said it will work with Erik Buell Racing for selling bikes in North America and Europe, chief executive Pawan Munjal told reporters.

 

Last year Hero MotoCorp had entered into technology sourcing pact with EBR as it looked to strengthen its presence in the high-end bike segment.

 

The development is a part of the Indian two-wheeler major’s strategy to enhance technological prowess, post the break up of the erstwhile joint venture with Honda—Hero Honda.

 

The idea behind entering into partnership with EBR was a part of HMC’s overall strategy to have multiple technology sources for different segments and enhance its own R&D capability.

 

In December 2010, the Hero Group and Honda had agreed to end their 26-year-old relationship, with the Indian partner agreeing to buy out Honda’s 26% stake in Hero Honda for Rs3,841.83 crore.

 

The two erstwhile partners had, however, signed a new licensing agreement under which Hero will pay Honda 45 billion yen (about Rs2,450 crore) till 2014.

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