During August 2013, liquid funds reported inflows of Rs321billion even as income funds observed outflows for the third successive month of Rs84 billion, Morgan Stanley in its research note on domestic mutual funds
During August 2013, equity funds saw marginal inflows of Rs4 billion after reporting outflows of Rs19 billion in the previous month. Similarly, fixed income funds reported inflows of Rs237 billion versus outflows of Rs479 billion in July 2013. This is according to a Morgan Stanley in its research note on domestic mutual funds.
During August 2013, according to Morgan Stanley, liquid funds reported inflows of Rs321 billion even as income funds observed outflows for the third successive month of Rs84 billion. At the aggregate level, the mutual fund industry saw inflows of Rs242 billion.
The trend in equity fund flows is given in the following chart:
At the end of August 2013, the domestic mutual fund industry assets remained at Rs7.6trillion, added the research note.
The fixed income assets under management rose 2% month-on-month to Rs6 trillion in August 2013.
On sector trends, according to Morgan Stanley, in July 2013, as per SEBI, assets under management for Technology continued to see the most month-on-month increase, while assets under management of Financials declined the most. At the end of July 2013, Financials sector continues to enjoy the largest weight in the domestic MF assets under management (at 22.8%) followed by Technology sector (at 13.1%).
Finally, the overall picture for the domestic mutual funds industry is given in the following table:
The new Companies Act has enhanced scope of auditors by mandating internal audit for such class of companies as may be specified, while by imposing civil liability on the auditors, the Act requires auditors to be more cautious and careful while auditing
Following the trend in the US, which replaced its 37 year old Companies Act in 2006, India is also replacing its nearly six decades old law (Companies Act, 1956) with the new Companies Act, 2013 (the Act). The New Act has already been assented by Lok Sabha and Rajya Sabha on 18 December 2012 and 8 August 2013, respectively. It received the nod from the President on 29 August 2013. The Companies Bill, which was in pipeline since five years, has now been enacted as Act no: 18 of 2013 that will replace the 1956 Act.
The 1956 Act had some 658 sections and 14 schedules and the new Act has 470 sections and 7 schedules. This does not mean that the Act has now been made smaller or simpler. The words ‘as may be prescribed’ is appearing at 416 places in the Act, which means a huge amount of law will be enacted by way of rules to be issued by the government in process.
As the Act has already got the assent of the President last month, the Ministry of Corporate Affairs (MCA) has placed on its portal, the draft rules for public comments on 6 September 2013 (Draft Rules) inviting comments till 8 October 2013.
Here are some conflicting provisions in the Draft Rules and the Act relating to rotation of auditors in listed and in certain class of companies to be specified.
Provision under the Act
Among others, one of the major changes, which the new Act is proposing, is that it has now put a restraint on the terms of the auditors. Under the 1956 Act, statutory auditors were to be appointed by companies annually. However, section 139 of the new Act now requires appointment (which has been defined by way of an explanation under sub-section (1) to include re-appointments also) of auditors at every sixth annual general meeting (AGM) and the appointment is to be ratified at every AGM.
On the sixth AGM, the auditor is eligible for reappointment, in terms of section 139 (9), subject, however, to the mandatory retirement provisions of sub-section (2) of the said section.
Additionally, in terms of sub-section (2), in case of listed companies or companies of a class to be notified, there is a bar on reappointment of an auditor, if he has already held: (a) one term of 5 years in case of an individual; or (b) two consecutive terms of 5 years in case of a firm. Once the bar on reappointment applies, there is a mandatory cooling-off period of 5 years.
On one hand, where the Act has enhanced the scope of auditors by mandating internal audit for such class of companies as may be specified, on the other hand, by imposing civil liability on the auditors, the Act now requires auditors to be more cautious and careful while auditing.
Provisions under the Companies Rules, 2013
After the new and strict provisions relating to audit and auditors in the Act, the Draft Rules seems to be another challenge for the chartered accountants. Rule 10 of the Draft Rules deals with provisions relating to audit and auditors.
Rule 10.4 (4) of the Draft Rules reads as:
“For the purpose of the rotation of auditors:
(i) In case of an auditor (whether an individual or audit firm), the period for which he or it has been holding office as auditor prior to the commencement of the Act shall be taken into account in calculating the period of five consecutive years or ten consecutive years, as the case may be.
(ii) The incoming auditor or audit firm shall not be eligible if such auditor or audit firm is associated with the outgoing auditor or audit firm under the same network of audit firms or is operating under the same trade mark or brand.”
Para (i) above says that for the purpose of rotation of auditors under section 139 (4) (applicable to listed and other to be specified class of companies), the existing term of auditors shall also be taken into account. This is clearly contrary to the language of section 139(2) of the Act, which refers to "one term of 5 years" or "two terms of 5 years each".
Prior to the commencement of the Act, there may be no appointment of auditor for a term of five years at all. Even if an auditor has been holding his office for 5 years under the 1956 Act, it is not one term of 5 years, but 5 terms of one year each. If an auditor gets reappointed, it does not mean the term is any longer than annual. However, under the Act, before issue of Draft Rules, it was predicted that the ‘term’ will be new term starting after notification of the Act. The Draft Rules have, though divergent with the Act, made it clear, the existing term under the 1956 Act will also be counted for calculating the 5 years or 10 years term. It would mean that if the tenure of appointment of auditors under the Act will effectively be 4 years or 9 years and all related conditions are to be read with such term only.
As the Draft Rules are open for public comments till 8 October 2013 only, the chartered accountants should raise objection/ concern over this particular point to MCA.
(The author can be contacted at [email protected])
The denial of information by the PIO appears to be a mere blanket statement not supported by any cogent evidence or material for claiming exemption under Section 8(1)(h) of the RTI Act, the CIC said. This is the 171st in a series of important judgements given by former Central Information Commissioner Shailesh Gandhi that can be used or quoted in an RTI application
The Central Information Commission (CIC), while allowing an appeal, directed the Central Public Information Officer (CPIO) and head of Anti-corruption branch at Central Bureau of Investigation (CBI) to provide information about investigation report in the Ghaziabad Civil Court provident fund (PF) scam. The CPIO had claimed exemption using Sections 8(1)(a) and (h) of the Right to Information (RTI) Act.
While giving the judgement on 1 July 2011, Shailesh Gandhi, the then Central Information Commissioner said, "The CPIO has failed to discharge the burden placed upon him under Section 19(5) of the RTI Act to prove that the denial of information under Section 8(1)(h) of the RTI Act was justified."
Allahabad (Uttar Pradesh) resident Justice RN Mishra (retired), on 12 July 2010, sought from the CPIO information regarding investigation in the provident fund scam in the Ghaziabad Civil Court. Here is the information he sought and the reply provided by the PIO under the RTI Act...
Copy of following documents related with the investigation pertaining to Ghaziabad, Civil Court Provident Fund Scam:
1. FR Part-I
2. FR Part -II
3. Government Examiner of Question Document (GEQD) Expert Report
4. The First Information Report (FIR) lodged by CBI
5. Report of SP, CBI.
The documents including GEQD Opinions and FIR have been submitted in the Court of Special Judge, CBI, UP (East) Anti-Corruption, Ghaziabad along-with the Charge sheet.
The documents like FRs, SP Report would reveal identity of persons who have provided vital information in confidence during the course of investigation of this case.
The case is under trial, disclosure of information as contained in these reports would impede the prosecution of offenders.
In addition, the confidential CBI Reports have been sent to the Supreme Court in sealed cover and the matter is still sub judice. Hence, the details are withheld under Section 8(1) (g) and (h) of RTI Act, 2005.
Not satisfied with the PIO's reply, Justice Mishra (retired) filed a complaint before the CIC. In the complaint, he stated...
"…3. Because the investigation regarding the matter is already over and the documents collected in pursuance of it are public documents and does not impede any process of investigation or prosecution but rather it is to assist the fair and impartial proceedings under the relevant procedure.
4. Because there were five documents required through the application dt. 12.07.2010 but the Public Information Officer has declined to submit information regarding the serial no
. 1, 2 & 5 and has over looked the serial no . 3 & 4 on the ground that it is already submitted in the court of Special Judge, CBI, UP (East) Anti-Corruption, Ghaziabad which he cannot do under the act.
5. Because no document can be classified arbitrarily as secret or confidential except as provided for in the Act.
6. Because the information sought are absolutely beyond the purview of Section 8 of the Act No: 22 of 2005 and Official Secret Act, to which the Investigation Officer (IO). is taking shelter.
7. Because as disclosed in the letter of CBI, the Charge Sheet has been submitted and the list of witnesses & documents are given along with the charge sheet. Hence nothing remains confidential. Charge Sheeted person has right to know that who has deposed what against him and what document is relied upon against him.
8. Because the question of security does not arise. Every information or evidence given by any person during the investigation has to be brought on record arid has to be proved by prosecution, hence there is no justification for withholding the names of witnesses and details of documents.
9. Because on the basis of presumption of fear of security cannot be made basis to refuse relevant information.
10 Because the desired information does not in any way in going to impede the process of justice because the investigation is over and Charge Sheet has been filed in court as disclosed in the letter of CBI.
11. Because all the information & evidence collected by
1.0 , has to be placed on record of the case and has to be proved against the accused, hence this is a part of record and cannot be concealed.
12. Because no court has passed any order that any information regarding this case be kept secret, hence the information relating to case cannot with held under the garb of the pending of any transfer application in court.
13. Because even the press and news media are revealing the facts mechanically which means every information is being given to them by CBI but it refuses to give information to the person affected, thus double standard cannot be applied.
14 Because the report of IO on his basis of which the higher authorities have approved charge sheet, cannot be held to be confidential .It is part of investigation and case diary.
15. Because Charge Sheet has been submitted in the case and the Supreme Court's order dt 23.09.2009 says that if Charge sheet is submitted by IO the court concerned shall proceed with the case according to law As such only Transfer Application (TA) is pending before Supreme Court. IOcannot take the shelter of the pendency of TA before the said court.
Information not provided to applicant on incorrect grounds as the information sought does not come within the ambit of Section 8 (1) (g) and (h) RTI Act, 2005."
During the hearing on 1 July 2011 before Mr Gandhi, the then CIC, the PIO stated that the complainant, Justice Mishra (retired), was an accused charge sheeted in the PF Scam case and the trial against him was pending.
The PIO also gave written submissions before the Bench and took the plea that "As per notification dated 9 June 2011 of the Govt. of India, Ministry of Personnel, Public Grievances and Pensions (Annexure 'C') CBI has been included in the Second Schedule of the RTI Act, 2005 at Sr. No. No: 23. Therefore, the RTI Act did not apply to CBI".
The PIO further stated that the complainant had not filed a first appeal but directly approached the CIC by way of a second appeal. The PIO stated that if the information sought was furnished, it would reveal the identity of the persons/ resources who had provided vital information in confidence and impeded the prosecution of the offender. He also claimed exemption under Section 8 (1) (g) and (h) of the RTI Act.
Mr Gandhi then reserved his order at the hearing held on 1 July 2011.
During the next hearing, Mr Gandhi said, the Bench had perused the written submissions of the PIO. The PIO submitted that the complainant, instead of preferring a first appeal before the First Appellate Authority (FAA) had directly filed a second appeal before the CIC. "At the outset, the Bench clarifies that under Section 18 of the RTI Act, it is the duty of the CIC to receive and inquire into a complaint from any person who inter alia has been refused access to any information requested, believes that he or she has been given incomplete, misleading or false information under the RTI Act. There does not appear to be a statutory requirement of filing a first appeal and a complaint may be made directly to the CIC in certain circumstances. In the instant case, access to the information sought has been denied to the applicant. Therefore, he filed a complaint with the CIC under Section 18 of the RTI Act, hence the complaint is in order," the Bench said.
The PIO has further submitted that as per the notification dated 9 June 2011 (the Notification) of the Department of Personnel and Training (DOPT), Ministry of Personnel, Public Grievances and Pensions, CBI was included in the Second Schedule of the RTI Act at Serial No23. As per Section 24 of the RTI Act, the provisions of the RTI Act would not apply to certain organisations and hence, as per the said notification, the provisions of the RTI Act would not apply to CBI, except when the information pertained allegations of corruption and human rights violations.
Section 24(1) of the RTI Act stipulates inter alia that nothing contained in the RTI Act shall apply to the intelligence and security organisations specified in the Second Schedule, being organisations established by the Central Government or any information furnished by such organisations to that Government. Further, Section 24(2) of the RTI Act provides inter alia that the Central Government may, by notification in the Official Gazette, amend the Second Schedule by including therein any other intelligence or security organisation established by that Government and on the publication of such notification, such organisation shall be deemed to be included in the Second Schedule.
Under Section 24(2) of the RTI Act, the DOPT, Ministry of Personnel, Public Grievances and Pensions has, vide the said notification stated as follows:
"GSR 442 (E).- In exercise of the powers conferred by sub- section (2) of Section 24 of the Right to Information Act, 2005 (22 of 2005), the Central Government hereby makes the following further amendments in the Second Schedule to the said Act, namely:-
In the Second Schedule to the Right to Information Act, 2005, after serial number 22 and the entry relating thereto, the following serial numbers and entries shall be added, namely:-
23. Central Bureau of Investigation
24. National Investigation Agency
25. National Intelligence Grid" (
From the above, it appears that since CBI has been brought within the Second Schedule of the RTI Act it is exempted from the application of the RTI Act in accordance with Section 24 of the RTI Act. However, on a plain reading of the notification, it does not appear to have a retrospective effect, Mr Gandhi said.
He said, reliance may be placed upon the decision of the Supreme Court of India in P Mahendran vs State of Karnataka (AIR 1990 SC 405) wherein the Court observed as follows:
"It is well- settled rule of construction that every statute or statutory Rule is prospective unless it is expressly or by necessary implication made to have retrospective effect. Unless there are words in the statute or in the Rules showing the intention to affect existing rights the Rule must be held to be prospective. If a Rule is expressed in language, which is fairly capable of either interpretation it ought to be construed as prospective only. In the absence of any express provision or necessary intendment the rule cannot be given retrospective effect except in matter of procedure."
The Bench noted that the DOPT Notification was issued on 9 June 2011 and there was no express stipulation whatsoever that the Notification shall come into force with effect from any date prior to 9 June 2011. Moreover, the Notification does not appear to indicate any intention of affecting existing rights and therefore, must be construed as prospective in nature. Hence, information sought in any RTI application filed prior to 9 June 2011 with CBI must be provided in accordance with the provisions of the RTI Act, the Bench said.
Having established this, the Bench then examined whether the Notification itself was within the letter and spirit of the RTI Act.
The Bench said it perused the CBI website and the relevant extracts thereof have been reproduced below:
"The Central Bureau of Investigation traces its origin to the Special Police Establishment (SPE) which was set up in 1941 by the Government of India. The functions of the SPE then were to investigate cases of bribery and corruption in transactions with the War and Supply Department of India during World War II. Even after the end of the War, the need for a Central Government agency to investigate cases of bribery and corruption by Central Government employees was felt. The Delhi Special Police Establishment Act was therefore brought into force in 1946. The CBI's power to investigate cases is derived from this Act." (Emphasis added)
Mr Gandhi said, the Delhi Special Police Establishment acquired its popular current name, CBI through a Home Ministry resolution dated 1 April 1963. The relevant provisions of the Delhi Special Police Establishment Act, 1946, which describe the powers of CBI, are provided as follows:
"2. Constitution and powers of police establishment
t - (1) Notwithstanding anything in the Police Act, 1861 (5 of 1861), the Central Government may constitute a special police force to be called the Delhi Special Police Establishment 2[***] for the investigation 3 [in any 4 [Union territory]] of offences notified under section 3.
(2) Subject to any order which the Central Government may make in this behalf, Members of the said police establishment shall have throughout 5 [any 4 [Union territory]] in relation to the investigation of such offences and arrest of persons concerned in such offences, all the powers, duties, privileges and liabilities which police officers of 6 [that Union territory] have in connection with the investigation of offences committed therein.
2. The words "for the State of Delhi" omitted by Act 26 of 1952, sec. 3, (w.e.f. 6-3-1952).
3. Subs. by Act 26 of 1952, sec. 3 for "in that state" (w.e.f. 6-3-1952).
4. Subs. by A.L.O. 1956, for "Part C State".
5. Subs. by A.L.O. 1956, for "the State of Delhi".
6. Subs. by A.L.O. 1956, for "that State"." (Emphasis added)
The Mission and Vision of CBI in its Annual report of 2010 have been provided as follows:
To uphold the Constitution of India and law of the land through in-depth investigation and successful prosecution of offences; to provide leadership and direction to police forces and to act as the nodal agency for enhancing inter-state and international cooperation in law enforcement.
Based on its motto, mission and the need to develop professionalism, transparency, adaptability to change and use of science and technology in its working, the CBI will focus on
1. Combating corruption in public life, curb economic and violent crimes through meticulous investigation and prosecution.
2. Evolve effective systems and procedures for successful investigation and prosecution of cases in various law courts.
3. Help fight cyber and high technology crime.
4. Create a healthy work environment that encourages team-building, free communication and mutual trust.
5. Support state police organizations and law enforcement agencies in national and international cooperation particularly relating to enquiries and investigation of cases.
6. Play a lead role in the war against national and transnational organized crime.
7. Uphold Human Rights, protect the environment, arts, antiques and heritage of our civilization.
8. Develop a scientific temper, humanism and the spirit of inquiry and reform.
9. Strive for excellence and professionalism in all spheres of functioning so that the organization rises to high levels of endeavour and achievement." (Emphasis added)
Further, the FAQs on the CBI website provide an insight on the functioning and mandate of the CBI. The relevant portions have been reproduced below:
"1. Please give brief background of CBI.
During the period of World War II, a Special Police Establishment (SPE) was constituted in 1941 in the Department of War of the British India to enquire into allegations of bribery and corruption in the war related procurements. Later on it was formalized as an agency of the Government of India to investigate into allegations of corruption in various wings of the Government of India by enacting the Delhi Special Police Establishment (DSPE) Act, 1946 . In 1963, the Central Bureau of Investigation (CBI) was established by the Government of India with a view to investigate serious crimes related to Defence of India, corruption in high places, serious fraud, cheating and embezzlement and social crime, particularly of hoarding, black-marketing and profiteering in essential commodities, having all-India and inter-state ramifications. CBI derives its legal powers to investigate crime from the DSPE Act, 1946.
5. What types of Crimes CBI investigates today?
CBI has grown into a multidisciplinary investigation agency over a period of time. Today it has the following three divisions for investigation of crime:-
(i) Anti-Corruption Division - for investigation of cases under the Prevention of Corruption Act, 1988 against Public officials and the employees of Central Government, Public Sector Undertakings, Corporations or Bodies owned or controlled by the Government of India - it is the largest division having presence almost in all the States of India.
(ii) Economic Offences Division - for investigation of major financial scams and serious economic frauds, including crimes relating to Fake Indian Currency Notes, Bank Frauds and Cyber Crime.
(iii) Special Crimes Division - for investigation of serious, sensational and organized crime under the Indian Penal Code and other laws on the requests of State Governments or on the orders of the Supreme Court and High Courts.
The laws under which CBI can investigate Crime are notified by the Central Government under section 3 of the DSPE Act.
6. What is the difference between the nature of the cases investigated by the National Investigation Agency (NIA) and the CBI?
The NIA has been constituted after the Mumbai terror attack in November 2008 mainly for investigation of incidents of terrorist attacks, funding of terrorism and other terror related crime, whereas CBI investigates crime of corruption, economic offences and serious and organized crime other than terrorism.
29. Does CBI perform any other important function other than investigation of crime?
Yes. CBI has been notified as the Interpol of India. CBI has a training academy in Ghaziabad, where it organizes training courses in various subjects not only for its own officers but for officers from other countries as well as from State & UT police organizations, vigilance officers of Public Sector Undertakings, Banks etc." (Emphasis added)
Mr Gandhi said, on a careful perusal of the material, it can be ascertained that CBI was established for the purposes of investigation of specific crimes including corruption, economic offences and special crimes. It continues to discharge its functions as a multi- disciplinary investigating agency and is evolving more effective systems for investigation of specific crimes. "Members of CBI have all the powers, duties, privileges and liabilities which police officers have in connection with the investigation of offences. There is no claim in its mandate and functions, as described above, that CBI is involved in intelligence gathering or is a security organisation. Even the additional functions performed by CBI other than investigation of crimes do not include any function, which would lend it the character of an intelligence or security organisation. In view of the same, CBI does not appear to fit the description of an 'intelligence or security organisation' under Section 24(2) of the RTI Act," he said.
Even by virtue of the fact that certain organisations such as CBI, during the course of investigation, may touch upon terrorist- related crimes or matters that may have an impact on the security of the nation, the same cannot be a reason for classifying such an organisation as intelligence or security organisation, the Bench noted.
"If such a claim was to be accepted, it would mean that every organisation which is involved in some investigation or the other, including the police, would come within the realm of Section 24(2) of the RTI Act. The absurdity of this proposition may be seen from an instance where terrorists launch bomb attacks in trains, the Ministry of Railways and other local authorities may obtain certain information which can be classified as 'intelligence' or such information may have an impact on the security of the nation. However, that cannot be a reason for bringing the Ministry of Railways or such other local authorities within the Second Schedule of the RTI Act. It is pertinent to note that on the CBI website, in response to FAQ 6, it has been clearly stated that the CBI investigates crimes of corruption, economic offences, and serious and organized crimes other than terrorism," it said.
Even where organisations such as CBI may obtain certain information that can be classified as 'intelligence' or may have an impact on the security of the nation, the same may be sought to be exempted from disclosure under Section 8(1) of the RTI Act. When Parliament codified the said right in the form of the RTI Act, it took care to lay down 10 exemption clauses in Section 8(1) on the basis of which information may be denied to citizens, unless there was a larger public interest. Here is the list of exemptions under Section 8(1) of the RTI Act:
"8. Exemption from disclosure of information.-
(1) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen,-
(a) information, disclosure of which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State, relation with foreign State or lead to incitement of an offence;
(b) information which has been expressly forbidden to be published by any court of law or tribunal or the disclosure of which may constitute contempt of court;
(c) information, the disclosure of which would cause a breach of privilege of Parliament or the State Legislature;
(d) information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information;
(e) information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information;
(f) information received in confidence from foreign government;
(g) information, the disclosure of which would endanger the life or physical safety of any person or identify the source of information or assistance given in confidence for law enforcement or security purposes;
(h) information which would impede the process of investigation or apprehension or prosecution of offenders;
(i) cabinet papers including records of deliberations of the Council of Ministers, Secretaries and other officers:
Provided that the decisions of Council of Ministers, the reasons thereof, and the material on the basis of which the decisions were taken shall be made public after the decision has been taken, and the matter is complete, or over:
Provided further that those matters which come under the exemptions specified in this section shall not be disclosed;
(j) information which relates to personal information the disclosure of which has no relationship to any public activity or interest, or which would cause unwarranted invasion of the privacy of the individual unless the Central Public Information Officer or the State Public Information Officer or the appellate authority, as the case may be, is satisfied that the larger public interest justifies the disclosure of such information:
Provided that the information, which cannot be denied to the Parliament or a State Legislature shall not be denied to any person."
Mr Gandhi said the right to information is a fundamental right of the citizens. "However, when the fundamental right to information was being codified by way of the RTI Act, the Parliament felt that certain 'intelligence and security organisations' may require greater protection from disclosure of information and therefore stipulated Section 24(1) of the RTI Act. Therefore, even at the cost of abridging the fundamental right to information of citizens, the Parliament identified certain bodies as "intelligence and security organisations" that required to be protected from disclosure of information to serve a greater purpose. These organisations were consequently included in the Second Schedule," he said.
"Given the stature and mandate of CBI, it does not seem plausible that the Parliament could have inadvertently omitted to include CBI in the Second Schedule when the RTI Act was being enacted. By enacting the Notification and bringing CBI within the Second Schedule, the Government appears to have increased the scope of Section 24(2) of the RTI Act, which was not envisaged by the Parliament. By this method the Government could keep adding organisations to the Second Schedule, which do not meet the express criteria laid down in Section 24(2) of the RTI Act and ultimately render the RTI Act ineffective. The Government cannot frustrate a law made by the Parliament by resorting to such colourable administrative fiat," the CIC noted.
"By enacting the Notification and placing CBI in the Second Schedule, the government appears to be claiming absolute secrecy for CBI without the sanction of law," Mr Gandhi said adding that, "The RTI Act was a promise to citizens by Parliament of transparency and accountability. Given that the previous year has been characterized by unearthing of various scams in the Government which are being investigated by CBI, inclusion of CBI in the Second Schedule by the government would be considered to be a step to avoid the gaze and monitoring of citizens in matters of corruption."
"In addition," the Bench said, "Under Section 4(1)(d) of the RTI Act, it is mandated that every public authority shall provide reasons for its administrative or quasi-judicial decisions to affected persons. In the instant case, the CIC has noted that neither in the Notification nor on its website or otherwise, the DOPT or the Ministry of Personnel, Public Grievances and Pensions has provided any reasons for including CBI in the Second Schedule. In the absence of any reasons, the Government's move appears to be arbitrary in nature. It appears an attempt is being made to slip in the CBI with National Investigation Agency and the National Intelligence Grid into Schedule two."
In view of the foregoing reasons, the CIC said it is of the view that the Notification is not in consonance with, either the letter or spirit of the RTI Act, in particular Section 24,- for the following reasons:
1. As observed above, CBI is not an 'intelligence or security organisation', which requirement needs to be satisfied in order for it to be covered under Section 24 of the RTI Act and therefore, it cannot be included in the Second Schedule.
2. No reasons have been provided by the DOPT or the Ministry of Personnel, Public Grievances and Pensions, as required under Section 4(1)( d) of the RTI Act, to justify the inclusion of CBI in the Second Schedule. In the absence of reasons, inclusion of CBI in the Second Schedule along with National Intelligence Agency and National Intelligence Grid appears to be an arbitrary act. The promise made to Citizens under Section 4 (1) (d) of the RTI Act must be fulfilled.
Mr Gandhi said, "This Bench rules that the said notification of 9 June 2011 was not in consonance with the letter or spirit of Section 24 of the RTI Act, since it constricts the citizen's fundamental right in a manner not sanctioned by the law."
The CPIO also claimed exemption under Section 8 (1) (g) and (h) of the RTI Act. He claimed support from the Commission's decisions in Vinod Kumar vs. CBI (CIC/WB/A/2009/000503 dated 27/07/2010) and C Seetharamaiah vs. Commissioner of Customs & Central Excise (CIC/AT/A/2008/01238 dated 07/06/2010).
The CPIO contended that if the information sought was furnished, it would reveal the identity of the persons/ resources that had provided vital information in confidence and impede the prosecution of the offender. "In the Vinod Kumar case, the CIC held that the Criminal Procedure Code (CrPC) specifically debars the disclosure of case diaries and any deviation would necessarily impede the process of prosecution. On this basis, copies of FR I and FR II could not be provided to the appellant under the RTI Act and may be sought access to under the specific circumstances of the Indian Evidence Act, 1872 before the Trial Court, " the PIO said.
Section 22 of the RTI Act expressly provides that the provisions of the RTI Act shall have effect notwithstanding anything inconsistent therewith contained in the Official Secrets Act, 1923, and any other law for the time being in force or in any instrument having effect by virtue of any law other than the RTI Act.
"Section 173(2) of the CrPC appears to impose a restriction on access to information held by or under the control of a public authority, which is prima facie inconsistent with the RTI Act. Therefore, in accordance with Section 22 of the RTI Act, the provisions of the RTI Act shall override the provisions of CrPC only to the extent the latter prescribes anything inconsistent regarding furnishing of information to citizens. In view of the same, this Bench does not see the relevance of the Vinod Kumar Case as well as the Seetharamaiah Case in the instant matter," Mr Gandhi said.
"Moreover," he said, "it is legally established that information sought can be denied to citizens only on the basis of Sections 8 and 9 of the RTI Act. Section 8(1)(h) of the RTI Act exempts disclosure of information which would impede the process of investigation or apprehension or prosecution of offenders. Merely because the process of investigation or prosecution of offenders is continuing, the bar stipulated under Section 8(1)(h) of the RTI Act is not attracted; it must be clearly established by the PIO that disclosure of the information would impede the process of investigation or apprehension or prosecution of offenders."
"In the instant case, the PIO has denied the information simply on the basis that such disclosure would impede the process of prosecution. However, he has failed to explain how such disclosure would actually be an impediment to the process of prosecution, as laid down above by the High Court of Delhi. The denial of information by the PIO appears to be a mere blanket statement not supported by any cogent evidence or material on the basis of which it can be clearly demonstrated that such disclosure would in fact attract the exemption contained in Section 8(1)(h) of the RTI Act. On this basis, the Bench rejects the contention of the PIO that the information sought was exempted under Section 8(1)(h) of the RTI Act," Mr Gandhi said.
The CPIO also claimed Section 8(1)(g) of the RTI Act for non- disclosure of information and argued that the identity of the persons/ resources that had provided vital information in confidence would be revealed. Mr Gandhi said, the Bench is of the opinion that there is some merit in the contention raised by the Respondent.
Section 10(1) of the RTI Act provides as follows:
"10. Severability.- (1) Where a request for access to information is rejected on the ground that it is in relation to information which is exempt from disclosure, then, notwithstanding anything contained in this Act, access may be provided to that part of the record which does not contain any information which is exempt from disclosure under the RTI Act and which can reasonably be severed from any part that contains exempt information."
Under Section 10 of the RTI Act, it is possible to sever certain portions of the information before disclosing it to an applicant to ensure that information that is exempt from disclosure under the RTI Act is not disclosed. Therefore, this Bench has decided to apply Section 10 of the RTI Act to the information sought by the complainant.
While allowing the complaint, Mr Gandhi directed the CPIO to provide to the complainant copy of the FIR lodged by CBI. "The CPIO is further directed to send copies of FR I, FR II and GEQD Expert report after severing the names and other particulars of persons, the disclosure of which would endanger their life or physical safety or identify the source of information or assistance given in confidence for law enforcement or security purposes. Since the PIO has claimed that the report of SP, CBI has been given in a sealed cover to the Supreme Court, it appears to be exempted from disclosure under Section 8(1)(b) of the RTI Act and therefore need not be provided to the complainant," the Bench said.
CENTRAL INFORMATION COMMISSION
Decision No. CIC/SM/C/2011/000117/SG/13230
Complaint No. CIC/SM/C/2011/000117/SG
Complainant : Justice R N Mishra (Retired)
Allahabad (Uttar Pradesh)
Respondent : Nirbhay Kumar,
PIO & Head of Branch,
CBI, Anti-Corruption Branch,
CGO Complex- I, Kamla Nehru Nagar,
Hapur Road, Ghaziabad (Uttar Pradesh)