Connect with Us
Moneylife - Facebook Moneylife - Twitter Moneylife - Linkedin Moneylife - Youtube Moneylife Rss feed
close

Moneylife » Life » Public Interest » Disclosure of fiduciary information under Sec 8 (1) (e) of the RTI Act: This is the true scope of the exclusion clause

Disclosure of fiduciary information under Sec 8 (1) (e) of the RTI Act: This is the true scope of the exclusion clause

Vinod Kothari & Aditi Jhunjhunwala | 01/07/2011 11:14 AM | 

No statutory authority is above the Republic of India. In our democratic setup, the people of India are supreme. The exceptions contained in Section (8) are exceptional pieces of information for which disclosure is not warranted or not desirable for a variety of reasons—but the broad spirit of the RTI Act is full transparency

The RTI Act is one of the rare legislations that empower citizens and bind the bureaucracy. The rest of the laws do exactly the opposite. However, though the purpose of the RTI Act might have been benign, its actual operation continues to be bogged down by the burden of bureaucracy.

At first blush, a PIO (Public Information Officer) hides behind one or the other of the exclusions given under Section (8) of the Act and declines to provide the information under some pretext. The information seeker has the right to file an appeal, but how many people have the time, patience and resources to go for appeals?

Section (8) of the RTI Act enlists some special instances when the authorities are exempted from disclosing information sought for. This includes information that would be prejudicial to national integrity, security or economic interests; would constitute to contempt of court of law; would hamper police investigations; would affect commercial interests like trade secrets; would impede the process of investigation; would affect 'fiduciary' relationships and would harm the person physically.

One of the common exceptions relied upon by the authorities is that the information being sought is with the regulatory agency in "fiduciary relationship" [Sec 8 (1) (e)]. This article explains the meaning of information in fiduciary capacity in Sec. 8 (1) (e) and how, in most cases, the information held by a regulator cannot be said to be information held in a fiduciary capacity.

The plea of fiduciary relationship, advanced by several regulatory bodies has not impressed us. Fiduciary relationship is not to be equated with privacy and confidentiality. It is one where a party stands in a relationship of trust to another party and is generally obliged to protect the interest of the other party.  While entrusting any information under any Act, rule, proceedings etc., that is no agreement between the provider of the information and the regulatory authority that the information provided is to be kept immune from the scrutiny of the public authority. It is to be kept in mind that the RTI Act is premised on disclosure being the norm, and refusal being the exception.

MEANING OF 'FIDUCIARY'

The word "fiduciary" has been defined in Black's Law Dictionary as follows: which reads thus:

    Fiduciary- The term is derived from the Roman Law and means-

As a noun-a person holding the character of a trustee, or a character analogous to that of a trustee, in respect to the trust and confidence involved in it and the scruples of good faith and candor which it requires, or a person having duty created, by his undertaking, to act primarily for another's benefit in matters connected with such undertaking.    

It is evident from the above that a fiduciary is a trustee. In context of information, if the information was reposed with a person for safe-keeping, or a person came to be vested with confidential information, and there is a question of good faith between the information provider or concerned entity, and the person having the information, it can be said that there is a relation of trusteeship.

The Advanced Law Lexicon, 3rd Edition, 2005, defines fiduciary relationship as:

"A relationship in which one person is under a duty to act for the benefit of the other on the matters within the scope of the relationship. Fiduciary relationship usually arises in one of the four situations:

(1) When one person places trust in the faithful integrity of another, who as a result gains superiority or influence over the first,
(2) When one person assumes control and responsibility over another,
(3) When one person has a duty to act or give advice to another on matters falling within the scope of the relationship, or
(4) When there is specific relationship that has traditionally been recognised as involving fiduciary duties, as with a lawyer and a client, or a stockbroker and a customer."

Page
1

Post Comment

More in Moneylife

Punjab National Bank, Raghuram Rajan, Arun Jaitley, Narendra Modi

Eight PSBs to remain headless till January? +1850 views

TODAY'S TOP STORIES

Post your Comment


Alert me when new comment is posted on this article
 Please read our Moderation Policy and Terms of Use before posting


VIDEOS

How Moneylife Foundation’s Free Credit Helpline is important to you

LATEST COMMENT

Excellent article and issue covered my moneylife.I would request ml to carry similar article on how much commissi.. Suketu Shah

MORE

Forcible Do-gooding Sucheta Dalal

SC orders Govt to reveal full black money list tomorrow Moneylife Digital Team

Comment

1 Comment
KAMIL SAYEED

KAMIL SAYEED 3 years ago

Thanks Vinod Sir & Aditi for such a beautiful article... I also share similar views that no statutory authority can be above the Republic of India! All the laws are made by the legislature which comprises of the elected representatives of the people. The legislature derives its legislative powers from the Constitution. The preamble to the Constitution lays down that it is "We the people of India" who has given ourselves this Constitution implying that the ultimate source of the Constitution and all the statutes is we the people of India! Hence legislations like RTI Act cannot be so interpreted that it comes within the trappings of the exceptions provided therein so as to prejudice public interest or the object for which that special law has been made!

Reply »Link » Report abuse
X
Daily Newsletter

1,00,000 Readers

Follow Moneylife
DNL facebook icon DNL linked in icon DNL twitter icon DNL youtube icon DNL rss icon
Moneylife Magazine

What's your say?

Will the cut in diesel price help cool off inflation & lower the govt's subsidy bill?
Yes
No
Can't Say
 
Enter Code : secure code
    change code
VOTE

What you said

Which party would get majority in Maharashtra Assembly Election?

Thanks for casting your votes! View Previous Polls

Join Over 100,000 Awesome Readers

  1. News that Mainstream media does not always cover
  2. Views that are bold and unbiased
  3. Reports that focus on your interests as consumer, investor & citizen