Why is demonetisation being kept a closely guarded secret by the RBI and PMO?

Millions of Indians from every corner of the country have stood in queues at banks and automatic teller machines (ATMs), and suffered enormous inconvenience since 8 November 2016 to withdraw their own money. There has probably never been a decision before (except during wars) which has directly affected every Indian, that too for such a long time.

The wide sweep of their decision itself demands complete transparency about the decision making process, its implementation, public consultations if any, and precise data about distribution of cash to various parts of the country, to each bank and ATM service provider and also whether it was distributed equitably or not.

 

Access to such information comes under Section 4 of the Right to Information (RTI) Act. However, RTI activists find that the Reserve Bank of India (RBI) as well as Prime Minister’s Office (PMO) are refusing to part with information under cover of Section 8 of the RTI Act.

 

Section 4 (C) of the RTI Act makes it binding on the public authority to “publish all relevant facts while formulating important policies or announcing the decisions which affect public.” Under Section 4 (d) of the RTI Act, it is mandatory for the public authority to “provide reasons for its administrative or quasi-judicial decisions to affected persons.”

 

Hence, the RBI should have released information on demonetisation and its implementation on a suo moto basis, says Pune-based RTI activist Vijay Kumbhar. He says, “It is such a public issue of such magnitude that there should no ground for an applicant to file first or second appeal, as every aspect of such a far-reaching decision should be put in the public domain under Section 4, by the RBI, at least now, even if it was not done earlier.” But that is not happening.

 

Hemant Kumar, an Ambala-based RTI activist filed a RTI application with the RBI, seeking documents pertaining to the decision making process of Rs500 and Rs1,000 denomination notes, date wise; file notings and minutes of the meetings of Central Board of Directors of the RBI and their recommendation to the government.

 

Kumar has been denied information by the Central Public Information Officer (CPIO) stating that the information sought by him relates to sensitive matters and hence comes under exemption as per Section 8 (1) (a) of the RTI Act, 2005.

 

This section states, “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.”

 

While Kumar has filed a first appeal, he wonders how this information can be rejected when it is over a month since demonetisation was announced.

 

Punjab-based RTI activist Parvinder Singh Kina has also filed an RTI application with the PMO. He requested information on the date of the decision, copies of letters issues to various authorities and to RBI regarding its implementation, minutes of the cabinet meeting, legal and financial opinion sought on the subject. His application was forwarded to the Ministry of Home Affairs (MHA), which denied information, again under Section 8(i) (a) of the RTI Act.

Noted RTI activist Subhash Chandra Agrawal says, “A recent media report quotes the Secretary, Department of Economic Affairs (DEA) saying, there was no need to go into the process of decision-making regarding the 8th November (2016) demonetisation drive. If the report is true, this is a worrisome departure from the commitment to transparency and accountability voiced by the Prime Minister, time and again.”

In another example, Venkatesh Nayak, a noted RTI activist and research scholar has also been denied information. “On 14 November, within a week of the demonetisation drive, I filed an RTI application with the DEA seeking copies of the Cabinet Note that was approved by the Union Cabinet regarding the decision to demonetise currency notes of Rs1,000 and Rs500 denomination. I also sought to know whether the government had sought people's views on the issue of demonetisation prior to making the decision because the National Democratic Alliance (NDA) Government had taken steps to consult people on several other important policy issues in the past,” he says. Nayak has not received any reply.

 

In another RTI application that he filed with the RBI on this issue, Nayak sought copies of the minutes of all Board meetings of the central bank from the date on which the recommendation to demonetise the Rs1,000 and Rs500 currency notes, communication sent in this regard to the Government, representations received from any person or organisation suggesting demonetisation and all file notings on this subject. He says, “RBI rejected access to its Board meeting minutes and recommendations made to the Government and related file notings under Section 8(1)(a) of the RTI Act. As for representations received from the public, the CPIO has invoked Section 7(9) saying that the information cannot be provided in the form sought as it would lead to disproportionate diversion of resources of the organisation.”

 

Agrawal rightly says that “Selective raids on some limited bank-branches can never bring to book all wrong-doers in respect of malpractices involved in their effort to legalise old currency. The RBI should direct all banks to publish on their websites branch-wise details of the deposit of old currency and disbursal of new currency on each date after 8 November 2016, with link also available on RBI website.’’

 

 
Venkatesh Nayak's analysis on what is wrong with RBI's replies
 
1) There are at least eight grounds for rejecting access to information under Section 8(1)(a), namely, sovereignty and territorial integrity, strategic, scientific, economic, security and defence interests of the State, relations with foreign States and incitement to an offence. The CPIO seems to imply that all of them are equally applicable to queries in the RTI application. To imply that I would use the information to incite an offence without giving me an opportunity to be heard can amount to libel. There is no detailed reasoning as to how Section 8(1)(a) is applicable in the CPIO's decision.

2) Using Section 7(9) to deny access to the representations received from the people about demonetisation is also unlawful. According to Section 7(1) a request for information under the RTI Act may be rejected only for reasons specified in Sections 8 and 9. Section 7(9) is a facilitating clause under which information must be provided in the form in which it was sought unless the two conditions - disproportionate diversion of resources or danger t the safety and preservation of the record apply. If Section 7(9) is invoked, then the public authority has a duty to provide access in some other form that is convenient to it such as inspection or in electronic form etc. A decision from the CIC on this issue is in the 3rd attachment. The CPIO has simply ignored all these issues and rejected the RTI application in toto which is against both the letter and the spirit of the Act. The objective of the RTI Act is fostering greater transparency and accountability in Government. Yet the RBI in this case and in the earlier case, the DEA, seem to be going against the very purpose of the RTI Act.

3) It is not as if the RBI refuses to disclose minutes of meetings of all committees that provide it with advice. For example, the minutes of the meeting of the Committee on Monetary Policy held as recently as 21 December, 2016 are proactively disclosed on its website. The refusal to disclose the minutes of the Board meeting where the decision was taken to recommend demonetisation of the high value currency notes, is perplexing to say the very least.

4) Inaugurating the 10th Annual RTI Convention organised by the CIC in October, 2015, the Hon'ble Prime Minister had said that people should not only have the right to seek copies of official records under RTI, but also demand accountability for the decisions taken by public authorities. It is sad that the Hon'ble PM's vision of transparency is not shared by the officers who work under him. I was not even questioning the wisdom of the decision. Instead I had sought only copies of official records containing details of the decision making process. The RTI Act requires that such information be made public.

5) A couple of weeks ago, while hearing a bunch of petitions, the Hon'ble Supreme Court of India also asked the Attorney General of India whether he would produce the Cabinet Note relating to the demonetisation decision. The Apex Court has since recommended that these petitions be referred to a Constitution Bench.

RBI and DEA have a statutory obligation to be completely transparent and accountable to the people of India on the subject of demonetisation.
 

 

(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”.)

Comments
Mahesh S Bhatt
10 years ago
Oh My Darling Yeh hai India ,Happy New Year 2017 to all.Do listen to this great song of India which goes Yahan pe sab hai thoda thoda .. and para goes,Thoda sa sach thoda jooth,thodsa daan thodsi loot...
Than Yahan pe sab adha adha : .. ( forgot the lyrics)

Lastly yahan pe sab chalta hai ...

Jai Ho Jai Hind Vande Mataram yeh khaali shabd hai Matlab samjgaye us din Vijayi Ho honge Mahesh
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