The Reserve Bank of India (RBI) after getting strictures and strict warning from the Supreme Court, has finally shared inspection reports of four banks under the Right to Information (RTI) Act with activist Girish Mittal about a fortnight ago.
RBI, in a letter on 26 June 2019, wrote to Mr Mittal, that "In compliance with the SC judgement (on 26 April 2019), please find enclosed a CD containing inspection reports sought by you...after severing information which is exempted from disclosure under Section 8(1)(j) of RTI Act."
RBI shared inspection reports of ICICI Bank, Axis Bank and HDFC Bank for 2013, 2014 and 2015. For SBI, the period is for four years from 2012 to 2015. "...in view of the stay order by the High Court of Bombay in writ petition no.7711 of 2016 and no.8409 of 2016, we regret our inability to disclose the inspection reports of ICICI Bank, Axis Bank and HDFC Bank for the year 2012 at this state," the central bank said. The first of our analyses of these reports is out today.
Its is on SBI, done by our columnist R Balakrishnan.
Mumbai-based Mr Mittal had been trying to get information from the central bank on inspection reports of ICICI Bank, Axis Bank, HDFC Bank and State Bank of India (SBI) under the RTI Act. However, instead of sharing copies of the reports, the RBI tried not to share the reports citing fiduciary relations at every stage.
RBI even challenged the decision of central information commission (CIC) before the apex court. However, the Supreme Court repeatedly told RBI to share information. In fact, in March 2019, the apex court even threatened the RBI with contempt proceeding for not disclosing banks' annual inspection reports under the RTI Act.
Earlier, both, the apex court as well as CIC had held that RBI cannot refuse to put in the public domain the annual inspection reports of banks. However, RBI has refused to follow these orders saying that these reports contain 'fiduciary information' as defined under the RTI Act and, hence, cannot be placed in the public domain.
RBI’s repeated refusal to share banks’ inspection reports, prompted Mr Mittal to approach the Supreme Court.
In his petition before the SC, Mr Mittal, represented by senior counsel Prashant Bhushan and Pranav Sachdeva, contended that he had sought information under the RTI Act in December 2015 like copies of inspection reports of ICICI Bank, Axis Bank, HDFC Bank and State Bank of India (SBI) from April 2011 and copies of case files, with file notings on various irregularities detected by RBI in the case of Sahara Group of companies and erstwhile Bank of Rajasthan.
The petition recalled the Supreme Court ruling in a case that RBI is clearly not in any fiduciary relationship with any bank. RBI has no legal duty to maximise the benefit of any public sector or private sector bank and thus there is no relationship of 'trust' between them. (Read: SC issues contempt notice to RBI in RTI case
In the notice, the then central information commissioner Prof Sridhar Acharyulu had also asked the prime minister’s office (PMO), finance ministry and RBI to make public the letter sent by previous governor Raghuram Rajan on bad loans.
Earlier in February 2016, the Supreme Court had directed RBI to furnish a list of the companies which are in default of loans in excess of Rs500 crore or whose loans have been restructured under corporate debt restructuring (CDR) scheme by banks and financial institutions. (Read: Supreme Court asks RBI to submit list of big defaulters
Even in December 2015, the apex court, in a landmark judgement, had told RBI that the banking regulator cannot withhold information citing 'fiduciary relations' under the RTI Act.
Hearing a set of transferred cases, a division bench of Justice MY Eqbal and Justice C Nagappan had said, "From the past we have also come across financial institutions which have tried to defraud the public. These acts are neither in the best interests of the Country nor in the interests of citizens. To our surprise, the RBI as a Watch Dog should have been more dedicated towards disclosing information to the general public under the Right to Information Act. We also understand that the RBI cannot be put in a fix, by making it accountable to every action taken by it. However, in the instant case the RBI is accountable and as such it has to provide information to the information seekers under Section 10(1) of the RTI Act."