Successful applicants are likely to be those with financial firepower and strong management to handle the transition and growth, ratings agency Fitch said
Global rating agency Fitch today said the 26 applicants for new bank licences in India have to fulfil tough requirements that are likely to lead to only a limited number receiving licences and developing into substantial banks.
The central bank’s objective to address financial inclusion places heavy demands on profitability and capital, and is likely to lengthen the time it takes for a successful applicant to establish a presence, Fitch said in a statement.
The Reserve Bank of India (RBI) requires new banks to open one in four branches in rural areas and fulfil statutory reserve requirements—including placing 4% of deposits with the central bank and holding 23% in government bonds from day one.
“We believe some entities will find the 40% priority-sector lending targets tough, even though they have around three years to meet them. Infrastructure finance companies with large existing loan portfolios that have little or no prior presence in the required sectors are likely to find the target most challenging,” it said.
The strict conditions mean that profitability for new banks is likely to be limited until they secure a strong foothold, it said, adding, the transformation of existing franchises will be slow, as most will have to start from scratch.
Successful applicants are likely to be those with financial firepower and strong management to handle the transition and growth, it said.
The number of applicants is less than the market’s expectation, reflecting the high barriers to entry and regulatory restrictions that limit the competitive advantage of getting a bank licence—especially for established non-bank financial institutions (NBFI), it said.
“We believe the established NBFI applicants may be better placed to switch to bank status. Nevertheless, the move away from their core competencies and well-managed operations into new businesses and unfamiliar risks with additional regulatory hurdles, may put pressure on their capital,” Fitch added.
The CIC said, under Section 10 of the RTI Act, information could be provided after blanking out names of persons who the PIO feels may be endangered. This is the 127th 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 Public Information Officer (PIO) and senior superintendent of police at Central Bureau of Investigation (CBI) to provide copies of final investigation report and note sheets after blanking out names of persons in these records who the PIO feels may be endangered. The PIO had claimed exemption under Section 8(1)(h) of the Right to Information (RTI) Act.
While giving this judgement on 26 July 2011, Shailesh Gandhi, the then Central Information Commissioner said, “...the appellant should be provided the information after blanking out the names of persons in these records who the PIO feels may be endangered, or identify the source of information or assistance given in confidence for law enforcement or security purposes.”
Noida resident AN Gupta, on 4 June 2010, sought copies of investigation reports on investments of Rs175 crore and Rs23.64 crore by HUDCO in privately placed bonds of Tapi Irrigation Development Corporation and Shakti Resorts & Hotels (SRHL), respectively from the PIO of CBI. Here is the information he sought under the Right to Information (RTI) Act...
i) Copies of the complete final investigation reports of the investigating officers and law officers in case of investment of Rs175 crore in privately placed bonds of Tapi Irrigation Development Corporation and Rs23.64 crore in Shakti Resorts & Hotels by HUDCO. (Ref: PE-ACU-VI/CBI/New Delhi).
ii) Photocopies of all the note sheets on which investigation reports in case of Tapi Irrigation Development Corporation and Shakti Resorts & Hotels were processed and finally approved/ rejected by the competent authority.
In his reply, the PIO stated...
“2. In this regard it is intimated that PE 4 (A) 2007-ACU-Vl (relating to the investment made by HUDCO in Tapi Irrigation Development Corporation Bonds) and RC 1 (A)20O8-ACU-VI (relating to advance by HUDCO to Shrishakti Resorts & Hotels) were registered by CBI ACU-VI Branch. Both the said PE and RC were closed after conclusion of the enquiry/ investigation as per the orders of the competent authority.
3. Copy of the enquiry report in PE 4 (A)/2007-Vf, containing five pages can be provided on deposit of the prescribed photocopying charge @ Rs2 per page.
4. As far as providing photocopies of Note sheet, it is to intimate that this is a privileged document which contains comments of all officers of CBI and is exempted u/s 8(1)(g) of RTI Act 2005.
5 As far as providing investigation report/closure report in RC 1 (A)/2008-ACU-VI is concerned, it is intimated that the closure report is still pending consideration before the court of the special judge for CBI cases New Delhi. Since the matter is sub-judice, any information related to the case is exempted under Section 8 (1)(h) of RTI Act 2005.”
Not satisfied with the PIO's reply, Gupta filed his first appeal. The First Appellate Authority (FAA), however, upheld the denial of information by the PIO.
Gupta then approached the CIC with his second appeal.
During the hearing on 8 June 2011, Mr Gandhi, the then CIC, noted that the appellant had sent written submissions to the Commission dated 17 May 2011.
The PIO again claimed exemption under Section 8(1)(h) of the RTI Act for denying the information sought. He stated that CBI had filed for closure of the matter but the court rejected the closure report and directed for further investigation vide its order dated 29 January 2011. Therefore, the information sought was not required to be disclosed as it was covered under the exemption in Section 8(1)(h) of the RTI Act.
Mr Gandhi asked the PIO to establish how disclosure of the information sought would impede the process of investigation or prosecution.
The PIO submitted that the Delhi High Court in its judgment in Surendra Pal Singh vs Union of India WP (C) no16712/2006 dated 10 November 2006 held that “since prosecution of the offender is pending and has not been completed, it cannot be inferred that divulgence of information will not impede the prosecution of the offender. The respondents therefore are justified in claiming exemption under Section 8(1)(h) from disclosure of information sought by the petitioner”.
The CIC then reserved the order till next hearing on 26 July 2011.
During the hearing, Mr Gandhi, based on submissions of the parties and perusal of papers, noted that the investigation report in case of investment in privately placed bonds of Tapi Irrigation Development Corporation by HUDCO was provided to Gupta vide letter dated 19 July 2010. However, the final investigation report in case of investment in privately placed bonds of SRHL by HUDCO was denied by the PIO on the basis of Section 8(1)(h) of the RTI Act, which was upheld by the FAA.
The PIO argued since the court has asked it to further investigate the information sought (about HUDCO’s investment in SRHL) was not required to be disclosed as it was covered under the exemption in Section 8(1)(h) of the RTI Act.
Section 8(1)(h) of the RTI Act provides as follows:
“8. Exemption from disclosure of information.- (1) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen,
(h) information which would impede the process of investigation or apprehension or prosecution of offenders;”
Mr Gandhi said, 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.
Mr Gandhi cited a judgement given by Justice Ravindra Bhat of the Delhi High Court, in Bhagat Singh vs CIC W.P. (C) No. 3114/2007, where it was observed that ...
“13. Access to information, under Section 3 of the Act, is the rule and exemptions under Section 8, the exception. Section 8 being a restriction on this fundamental right, must therefore is to be strictly construed. It should not be interpreted in manner as to shadow the very right itself. Under Section 8, exemption from releasing information is granted if it would impede the process of investigation or the prosecution of the offenders. It is apparent that the mere existence of an investigation process cannot be a ground for refusal of the information; the authority withholding information must show satisfactory reasons as to why the release of such information would hamper the investigation process. Such reasons should be germane, and the opinion of the process being hampered should be reasonable and based on some material. Sans this consideration, Section 8(1)(h) and other such provisions would become the haven for dodging demands for information.
14. A rights based enactment is akin to a welfare measure, like the Act, should receive a liberal interpretation. The contextual background and history of the Act is such that the exemptions, outlined in Section 8, relieving the authorities from the obligation to provide information, constitute restrictions on the exercise of the rights provided by it. Therefore, such exemption provisions have to be construed in their terms; there is some authority supporting this view (See Nathi Devi v. Radha Devi Gupta 2005 (2) SCC 201; B. R. Kapoor v. State of Tamil Nadu 2001 (7) SCC 231 and V. Tulasamma v. Sesha Reddy 1977 (3) SCC 99). Adopting a different approach would result in narrowing the rights and approving a judicially mandated class of restriction on the rights under the Act, which is unwarranted.” (Emphasis added)
From the ruling, the Commission said, it was clear that the PIO, who is denying information under Section 8(1)(h) of the RTI Act, must show satisfactory reasons as to why disclosure of such 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 ground that such disclosure would impede the prosecution of offenders. 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 Delhi High Court,” Mr Gandhi said.
The Commission then rejected the contention of the PIO that the investigation report in case of investment in privately placed bonds of SRHL by HUDCO Ltd was exempted under Section 8(1)(h) of the RTI Act.
Further, the PIO had denied copies of note sheets on which investigation reports in both matters were processed and finally approved/rejected by the competent authority on the basis of Section 8(1)(g) of the RTI Act arguing that disclosure of the information sought 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.
Mr Gandhi said, “The Commission is of the opinion that there is some merit in the contention that disclosure of copies of note sheets on which investigation reports in both matters were processed and finally approved/rejected by the competent authority may attract Section 8(1)(g) of the RTI Act.”
Under Section 10 of the RTI Act, it is possible to severe 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.
While allowing the appeal, Mr Gandhi said, after applying Section 10 of the RTI Act, he comes to a conclusion that the appellant (Gupta) should be provided the information after blanking out the names of persons in these records who the PIO feels may be endangered, or identify the source of information or assistance given in confidence for law enforcement or security purposes.
The CIC also directed the PIO to provide copies of note sheets on which investigation reports in the Tapi matter and SRHL matter were processed and finally approved/ rejected by the competent authority, after blanking out the names of persons in these records who the PIO feels may be endangered, or identify the source of information or assistance given in confidence for law enforcement or security purposes before 22 August 2011.
CENTRAL INFORMATION COMMISSION
Decision No. CIC/SM/A/2011/000313/SG/13671
Appeal No. CIC/SM/A/2011/000313/AG
Appellant : AN Gupta,
District Gautam Budh Nagar (UP)
Respondent : MC Sahni,
PIO & Sr. Superintendent of Police,
Central Bureau of Investigation,
Anti Corruption - II,
5- B, CGO Complex,
9th Floor, Lodhi Road, New Delhi
The company has set up a special team at its head office handle these cases on priority and efforts shall be made to settle maximum claims within 72 hours
Leading private life insurer, Bajaj Allianz Life Insurance, has relaxed its claim settlement norms to ensure faster claim settlement to the Uttarakhand flood victims. The insurer has streamlined the normal procedure which now involves minimum documentation in order to settle all the claims on priority.
The company will settle claims on a confirmation of death by local authority/government of Uttarakhand or the Armed forces involved in rescue operations. A special team has been set up in the company’s head office at Pune to handle these cases on priority and efforts shall be made to settle maximum claims within 72 hours.
Apart from the confirmation from Uttarakhand authorities the company will require
• Photograph of the deceased
• KYC of the nominee/legal heir
The general investigation procedure may be waived off if the prime-facie documents certify the life assured was dead in Uttarakhand floods, the company added.