2015 (12) TMI 1775 - SC - Indian Laws

Denial of Information sought - indiscretion disclosure of information - information sought for by the respondents from the petitioner-Bank have been denied mainly on the ground that such information is exempted from disclosure under Section 8(1)(a)(d) and (e) of the RTI Act - RTI Act, 2005. Whether all the information sought for under the Right to Information Act, 2005 can be denied by the Reserve Bank of India and other Banks to the public at large on the ground of economic interest, commercial confidence, fiduciary relationship with other Bank on the one hand and the public interest on the other? Held that - The Right to Information Act, 2005 is a general provision which cannot override specific provisions relating to confidentiality in earlier legislation in accordance with the principle that where there are general words in a later statute it cannot be held that the earlier statutes are repealed altered or discarded - The Preamble of the RTI Act, 2005 itself recognizes the fact that since the revealing of certain information is likely to conflict with other public interests like the preservation of confidentiality of sensitive information , there is a need to harmonise these conflicting interests. It is submitted that certain exemptions were carved out in the RTI Act to harmonise these conflicting interests. In the instant case, the RBI does not place itself in a fiduciary relationship with the Financial institutions (though, in word it puts itself to be in that position) because, the reports of the inspections, statements of the bank, information related to the business obtained by the RBI are not under the pretext of confidence or trust. In this case neither the RBI nor the Banks act in the interest of each other. By attaching an additional fiduciary label to the statutory duty, the Regulatory authorities have intentionally or unintentionally created an in terrorem effect - RBI is a statutory body set up by the RBI Act as India s Central Bank. It is a statutory regulatory authority to oversee the functioning of the banks and the country s banking sector. Under Section 35A of the Banking Regulation Act, RBI has been given powers to issue any direction to the banks in ublic interest, in the interest of banking policy and to secure proper management of a banking company. It has several other far-reaching statutory powers. RBI is supposed to uphold public interest and not the interest of individual banks. RBI is clearly not in any fiduciary relationship with any bank. RBI has no legal duty to maximize the benefit of any public sector or private sector bank, and thus there is no relationship of trust between them. RBI has a statutory duty to uphold the interest of the public at large, the depositors, the country s economy and the banking sector. Thus, RBI ought to act with transparency and not hide information that might embarrass individual banks. It is duty bound to comply with the provisions of the RTI Act and disclose the information sought by the respondents herein - The baseless and unsubstantiated argument of the RBI that the disclosure would hurt the economic interest of the country is totally misconceived. In the impugned order, the CIC has given several reasons to state why the disclosure of the information sought by the respondents would hugely serve public interest, and non-disclosure would be significantly detrimental to public interest and not in the economic interest of India. RBI s argument that if people, who are sovereign, are made aware of the irregularities being committed by the banks then the country s economic security would be endangered, is not only absurd but is equally misconceived and baseless. The exemption contained in Section 8(1)(e) applies to exceptional cases and only with regard to certain pieces of information, for which disclosure is unwarranted or undesirable. If information is available with a regulatory agency not in fiduciary relationship, there is no reason to withhold the disclosure of the same. However, where information is required by mandate of law to be provided to an authority, it cannot be said that such information is being provided in a fiduciary relationship. In the present case, we have to weigh between the public interest and fiduciary relationship (which is being shared between the RBI and the Banks). Since, RTI Act is enacted to empower the common people, the test to determine limits of Section 8 of RTI Act is whether giving information to the general public would be detrimental to the economic interests of the country? To what extent the public should be allowed to get information? The Legislature s intent was to make available to the general public such information which had been obtained by the public authorities from the private body. Had it been the case where only information related to public authorities was to be provided, the Legislature would not have included the word private body . As in this case, the RBI is liable to provide information regarding inspection report and other documents to the general public - Even if we were to consider that RBI and the Financial Institutions shared a Fiduciary Relationship , Section 2(f) would still make the information shared between them to be accessible by the public. The facts reveal that Banks are trying to cover up their underhand actions, they are even more liable to be subjected to public scrutiny. We have surmised that many Financial Institutions have resorted to such acts which are neither clean nor transparent. The RBI in association with them has been trying to cover up their acts from public scrutiny. It is the responsibility of the RBI to take rigid action against those Banks which have been practicing disreputable business practices - 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. Economic interest of a nation in most common parlance are the goals which a nation wants to attain to fulfil its national objectives. It is the part of our national interest, meaning thereby national interest can t be seen with the spectacles(glasses) devoid of economic interest. Thus, the Central Information Commissioner has passed the impugned orders giving valid reasons and the said orders, therefore, need no interference by this Court - case dismissed.

Summary

Issues Involved:
1. Whether the Reserve Bank of India (RBI) and other banks can deny information under the Right to Information Act, 2005 on the grounds of economic interest, commercial confidence, fiduciary relationship, and public interest.
2. Whether the information sought can be disclosed if it is exempt under Section 8(1) of the RTI Act, 2005.
3. The extent to which information can be provided under the RTI Act, 2005.

Issue-wise Detailed Analysis:

1. Denial of Information on Grounds of Economic Interest, Commercial Confidence, Fiduciary Relationship, and Public Interest:
The main issue was whether the RBI and other banks could deny information under the RTI Act, 2005, citing economic interest, commercial confidence, fiduciary relationship, and public interest. The RBI argued that it conducts inspections of banks and financial institutions and that the information collected is held in a fiduciary capacity, which should not be disclosed to the public. The RBI also contended that disclosing such information could harm the economic interests of the banks and the banking system.

2. Exemption under Section 8(1) of the RTI Act, 2005:
The RBI relied on Section 8(1)(a), (d), and (e) of the RTI Act to deny the information. Section 8(1)(a) exempts information that would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific, or economic interests of the State, or lead to incitement of an offense. Section 8(1)(d) exempts 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. Section 8(1)(e) exempts information available to a person in his fiduciary relationship unless the competent authority is satisfied that larger public interest warrants the disclosure.

3. Extent of Information Disclosure:
The Supreme Court held that the RBI does not place itself in a fiduciary relationship with the banks as the information is obtained by the RBI under statutory duty and not under a pretext of confidence or trust. The Court emphasized that the RBI has a duty to act in the interest of the public at large, the depositors, the country's economy, and the banking sector. Therefore, the RBI should act with transparency and disclose information that might embarrass individual banks, as it is duty-bound to comply with the provisions of the RTI Act. The Court also noted that the RBI's argument that disclosing information would harm the economic interests of the country was misconceived. The Court held that the exemptions under Section 8(1) of the RTI Act should be applied in exceptional cases and only with regard to certain pieces of information for which disclosure is unwarranted or undesirable. The Court concluded that the information sought by the respondents should be disclosed as it serves the larger public interest.

Conclusion:
The Supreme Court dismissed the petitions filed by the RBI and other banks, upholding the orders of the Central Information Commission (CIC) directing the disclosure of the requested information. The Court emphasized the importance of transparency and accountability in the functioning of public authorities and the need to empower citizens by providing access to information. The Court held that the RBI and other banks cannot deny information under the RTI Act on the grounds of fiduciary relationship, economic interest, or commercial confidence, as the larger public interest warrants the disclosure of such information.