SC Gives ‘Last Opportunity’ to RBI for Rethinking Its Stance on Disclosures Under RTI
While giving 'one last opportunity', the Supreme Court on Friday asked Reserve Bank of India (RBI) to reconsider its position on disclosure of annual inspection reports of banks, list of wilful defaulters and other details sought by activists under Right to Information (RTI) Act. The apex court just stopped short of issuing a contempt notice against RBI governor, Shaktikanta Das, in this matter.
 
"Though we could have taken a serious view of RBI continuing to violate the directions issued by this Court, we give them a last opportunity to withdraw the disclosure policy insofar as it contains exemptions, which are contrary to the directions issued by this Court. The RBI are dutybound to furnish all information relating to inspection reports and other material apart from the material that was exempted in para 77 of the judgment. Any further violation shall be viewed seriously by this Court," the bench of Justice L Nageswara Rao and Justice MR Shah said in the order.
 
The apex court also directed the central bank to withdraw its non-disclosure policy, which the Court concluded is in violation of the Supreme Court's judgement in 2015. The RBI, as per 2015 judgement, was supposed to disclose the annual audit report of the banks, status of NPAs (non-performing assets) and action taken thereon.

Taking a serious view of the continued defiance by RBI, the court came down heavily asking the central bank to make full disclosure of its annual inspection reports on the financial health of banks including position of NPAs and also withdraw its disclosure norms as they came in the way of making information public on the state of banks under the RTI.

A bench of Justice L Nageswara Rao and Justice MR Shah said: "Any further violation will be viewed seriously."
 
Only last month, the Supreme Court has threatened RBI with contempt proceeding for not disclosing banks' annual inspection reports under the RTI. (Read: Supreme Court Warns RBI of Contempt Proceedings for Not Disclosing Banks' Annual Inspection Reports under RTI)
 
Earlier, both, the apex court as well as central information commission (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.
 
RTI activists Subhash Chander Agrawal and Girish Mittal had moved the top court seeking contempt action against RBI governor for not complying with its 2015 judgement.
 
The petitioners had claimed that RBI and its former governor Dr Urjit Patel had 'willfully and deliberately' disobeyed the apex court's judgement asking the central bank to disclose information under the RTI Act.

The two petitioners sought initiation of contempt of court action against former Governor for not disclosing information as directed by the top court.

One of the contempt petitions filed by Girish Mittal said that RBI refused to provide information sought about the inspection reports of some banks.
 
In the petition, Mumbai-based 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.
 
However, RBI denied the information in January 2016 that such information is exempted under Section 8(1)(e) of the RTI Act and Section 45NB of the Reserve Bank of India Act.
 
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)
 
Last year in November, the CIC too had issued a show-cause notice to Dr Urjit Patel, the then governor of RBI, for not honouring a judgement of the Supreme Court on disclosure of wilful defaulters’ list who had not paid loans of Rs50 crore and more. (Read: RBI Governor Gets Show Cause Notice from CIC for Not Disclosing Defaulters’ List)
 
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.
 
In the order, Prof Acharyulu had stated, "The Commission finds no merit in hiding the names of, details and action against wilful defaulters of big bad loans worth hundreds of crores of rupees. The RBI shall disclose the bad debt details of defaulters worth more than Rs1,000 crore at the beginning, of Rs500 crore or less at later stage within five days and collect such information from the banks in due course to update their voluntary disclosures from time to time as a practice under Section 4(1)(b) of RTI Act."
 
Prof Acharyulu, irked over the denial of information on wilful defaulters who had unpaid loans of Rs50 crore and more, asked the RBI governor to explain why maximum penalty should not be imposed on him for ‘dishonouring’ a verdict from the apex court, which had upheld a decision taken by then information commissioner Shailesh Gandhi, calling for disclosure of names of wilful defaulters.
 
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. 
  • Like this story? Get our top stories by email.

    User

    COMMENTS

    SuchindranathAiyerS

    4 months ago

    If the disclosure causes a run on some banks, will the RBI bail them out? Will the RBI have the resources to do after these have bee transferred to Government?

    Latest Move on RTI Could Reduce Autonomy of Information Commissioners: Reports
    The Indian government’s latest move, a secret proposal that is being considered seeks to undermine the autonomy of information commissioners and the Central Information Commission (CIC), say reports.
     
    According to a report from Huffington Post, the union government, has proposed setting up a committee, which could effectively reduce the autonomy granted to the information commissioners under the Right to Information (RTI) Act. 
     
    As per a proposal, the government plans to set up committees led by bureaucrats, which would sit and decide on complaints against the chief information commissioner (CIC) and the information commissioners (ICs), says other report from the Indian Express.
     
    The government plans to setup two committees of which one would receive and decide on complaints against the CIC and a second one to receive and decide on complaints against ICs. 
     
    This new committee is expected to include the cabinet secretary, secretary of the Department of Personnel Training (DoPT) and a retired chief information commissioner, while the committee for the ICs is expected to include secretary (coordination) in the Cabinet Secretariat, Secretary DoPT and a retired Information Commissioner. 
     
    RTI activist and former central information commissioner Shailesh Gandhi observed, “I believe all positions in government must look at complaint mechanism and monitor them, but the complaint mechanism must be very well thought through.” 
     
    According to Huffington Post, apart from being extremely regressive, the move would be illegal as the RTI Act envisages the ICs as independent institutions and provides several safeguards to insulate them from government control and interference. 
     
    Section 14(1) of the law states that commissioners can be removed only by the President “on the ground of proved misbehaviour or incapacity after the Supreme Court, on a reference made to it by the President, has, on inquiry, reported that the Chief Information Commissioner or any Information Commissioner, as the case may be, ought on such ground be removed”.
     
    “The Bharatiya Janata Party (BJP) government’s onslaught on the transparency law has not been limited to attempts to compromise the autonomy of information commissions. The government impaired the functioning of the CIC by not making appointments to fill vacancies. Ever since the BJP came to power in 2014, not a single appointment to the CIC has been made unless citizens approach courts and get necessary directions. In 2018, out of a total sanctioned strength of 11 commissioners, the CIC was functioning with just three commissioners. It was finally only on the orders of the Supreme Court that the Chief and four commissioners were selected by the PM-led selection committee,” the report concludes.  
  • Like this story? Get our top stories by email.

    User

    COMMENTS

    GLN Prasad

    4 months ago

    Autonomy does not mean authoritarian. There should be controls and redressal of grievances in every authority. As a common man, I do not perceive any problem to the public in such measures by Govt., and I welcome such move as I expect that ICs will be more cautious in delivering such decisions. Now there is no such review of IC decisions and a common man should go for a writ before HC if he wants a remedy, and some ICs are aware of this weakness and in selected cases, depending on appellants capacity they take their own decisions. After all, ICs are also human beings and not above pressures/influences.

    DoPT Denies Information despite Strictures by Supreme Court on Transparency in CIC Appointments
    Shockingly, despite the Supreme Court order on 15 February 2019 directing the government to be transparent regarding the selection process and appointment of central and state information commissioners (ICs), the DoPT (department of personnel & training), which makes these appointments, recently, denied information under RTI (Right to Information), pertaining to the selection process of some more central ICs. 
     
    • The information that DoPT refused to provide includes: 
    • The list of the 256 applicants;
    • The constitution of the search committee;
    • The number of meetings held and the persons who attended them to select the candidates; and 
    • The criteria adopted in shortlisting the candidates for the recent selection of the four central ICs who have been appointed.
     
    In reply to RTI activist Anjali Bharadwaj’s application, the DoPT has audaciously replied that, “The judgment of the Honourable Supreme Court…is under consideration of the Department. The information relating is exempted under Section 8 (1) (i) of the RTI Act 2005. It would not be conducive to give such information in the manner it is sought since the process of selection is yet to be completed. No such practice is followed in any other equivalent high-level appointments of government.”
     
    So, what information did Ms Bharadwaj ask for that made the DoPt defy the apex court's order and bring it under Section 8 of the RTI Act? The following was her requisition:
    In January 2019, the DoPT had invited applications for four posts of information commissioners in the Central Information Commission. Please provide the following information in this regard:
     
    • Number of applications received by the government in pursuance of the advertisement;
    • Names and particulars of persons who have applied in pursuance of the advertisement;
    • Copies of all documents, records, file notings, correspondence etc related to the process adopted by the government to analyse or shortlist the applications received for consideration for the post of information commissioners;
    • If any search committee has been constituted, please provide the following information related to the said committee:
     
    a) Order regarding the constitution of the committee;
     
    b) Names of the members of the committee;
     
    c) Dates of all meetings of the committee;
     
    d) Agenda of all meetings of the committee;
     
    e) Copy of minutes/discussions/proceedings/verbatim recordings etc of the proceedings of the committee;
     
    f) Names and designations of persons attending the meeting;
     
    g) Criteria adopted by the committee for shortlisting the candidate.
     
    Ms Bharadwaj also sought information on the meetings held to select information commissioners as regards date and agenda of the meetings, minutes of the meetings of the proceedings and persons who attended it.
     
    The DoPt in its reply to Ms Bharadwaj has provided its reply in a paragraph stating that, “the total number of applications received were 256. An advertisement for filling up of the four posts of Information Commissioners in the CIC was put up on the DoPT website on 4 January 2019 and published in the newspapers on 8 January 2019. The last date for receipt of application was 25 January 2019…The instructions and orders issued from time to time relating to Right to Information Act are available in the public domain…”
     
    States Ms Bharadwaj, “It is shocking that the DoPT has denied records on appointment of information commissioners and says they are still considering the SC judgment which ordered transparency in appointments. What are they considering- whether to comply with SC judgment or not?”
     
    It may be recalled that Sudhir Bhargava, an information commissioner, who was a former CIC was appointed as the Chief Central Information Commissioner in January 2019 along with four information commissioners—Vanaja N Sarna (the only lady), formerly, chief of the Central Board of Excise and Customs (CBEC); Yashwardhan Kumar Sinha, former High Commissioner of India to the UK; Suresh Chandra, former Union law secretary and Neeraj Kumar Gupta, secretary in the department of investment and public asset management.
     
    These appointments were not as per the norms laid out for these committees as per the RTI Act. Therefore, Ms Bharadwaj had pointed out in the Supreme Court, “the search committee had, in violation of its mandate, short-listed persons who had not even applied for the post in response to advertisements. Further, the minutes of the search committee meeting revealed that no rational criteria were adopted on the basis of which the short-listing was done. Also, the minutes showed the completely ad-hoc manner of functioning of the search committee, wherein people who were appointed members of the committee, also applied for the post and had to be subsequently replaced and were finally even short-listed. One of the persons who has been appointed- Shri Suresh Chandra, had not even applied for the post.”
     
    As a sequel to her complaint, the SC had directed the government to make the entire selection process transparent by uploading all details on the website. Upholding the right to information as a fundamental right flowing from the Constitution of India, the Court had given significant directions to ensure timely and transparent appointment of information commissioners. However, the DoPT chooses to defy it. 
     
    (Vinita Deshmukh is consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte and is the author of “The Mighty Fall”.)
  • Like this story? Get our top stories by email.

    User

    We are listening!

    Solve the equation and enter in the Captcha field.
      Loading...
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email

    BUY NOW

    online financial advisory
    Pathbreakers
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 3 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)