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RBI should disclose information regarding banks

Finsec Law Advisors

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The Supreme Court passed a judgment on December 16, 2015, in the case of Reserve Bank of India v. Jayantilal N. Mistry, wherein the RBI and other banks had challenged the orders of the Central Information Commission, which directed them to furnish information as sought by citizens under the Right to Information Act, 2005.

The Court had to determine whether RBI and other banks can deny information sought for under the RTI Act to the citizens on the grounds of economic interest, commercial confidence, fiduciary relationship vis-a-vis public interest. The Court rejected RBI's contentions that the information sought for was exempted under the RTI Act since it was obtained in a fiduciary capacity and providing such information relating to banking would pre-judiciously affect the economic interest of the country. The Court held that exemptions apply to exceptional cases and only with regard to information for which disclosure is unwarranted or undesirable. The Court maintained that the information shared by banks with RBI cannot be brought under the purview of fiduciary relationship. Further, the Court held that RBI does not have a legal duty to maximize any bank's benefit, and thus there is no relationship of 'trust' between them. It was held that RBI has a statutory duty to uphold the interest of the public at large, the country's economy and the banking sector, and hence should act with transparency and provide information regarding private and public banks as sought by citizens under the RTI Act.The judgment will have implications on other regulators, whereby they may have to provide information, gathered through inspection and audit reports, regarding the entities they regulate under the provisions of the RTI Act. However, the regulators will be immune from providing information regarding any pending investigation or if the information affects someone's privacy.