Central Information Commission
T V Sudhakar vs Reserve Bank Of India on 14 July, 2022
Author: Neeraj Kumar Gupta
Bench: Neeraj Kumar Gupta
के ीयसूचनाआयोग
Central Information Commission
बाबागंगनाथमाग ,मुिनरका
Baba Gangnath Marg, Munirka
नई द ली, New Delhi - 110067
ि तीयअपीलसं या/Second Appeal No.CIC/RBIND/A/2020/136602
Kotak Mahindra Bank Ltd. ... अपीलकता /Appellant
Through Authorized Signatory
Mr. T V Sudhakar
VERSUS
बनाम
CPIO ... ितवादी/Respondent
Reserve Bank of India,
Department of Banking Supervision,
Centre-1, World Trade Centre,
Cuffe Parade, Colaba, Mumbai- 400005
Relevant dates emerging from the appeal:-
RTI : 25-11-2019 FA : 05-03-2020 SA : 09-09-2020
Hearing: 16-12-2020,
CPIO : 11-02-2020 FAO : 14-05-2020 15-01-2021 & 11-07-
2022
ORDER
1. The appellant filed an application under the Right to Information Act, The above mentioned matters have been listed before the Commission for hearing on 16-12-2020 & 15-01-2021, wherein the Commission made following observations:-
"The Commission after adverting to the facts and circumstances of the case, hearing both the parties and perusal of records, notes that RBI expressed their desire to disclose the information sought by the original applicant i.e., Shri Kabir Agarwal on the basis of the observations made by the Hon'ble Supreme court in Jayantilal N. Mistry & Anr. vs. Reserve Page 1 of 8 Bank of India in 16.12.2015. Since this order was recalled in Miscellaneous Application No (s) 2342 of 2019 in TC (C) No. 91/2015 (Reserve Bank of India Vs. Jayantilal N. Mistry & Anr.) and likely to be listed February 2021. Hence, in the interest of justice and acceding to the request of both the parties, the instant matter is adjourned. The operation of the CPIO's decision dated 11.02.2020 and FAA's order dated 14.05.2020 shall remain stayed till further order."
2. In view of the above, the aforesaid matter was thus adjourned and listed today for further hearing.
Hearing:
3. Adv. Aayesh Gandhi (Counsel for the Appellant Bank) attended the hearing through video-conferencing. The respondent, Rajalaxmi Sethi, CPIO/ AGM, attended the hearing through video-conferencing. The original appellant remained absent during the hearing.
4. The written submission of parties are taken on record.
5. The Counsel for the Appellant Bank has referred the reply provided by CPIO and order passed by the FAA and submitted that the CPIO, RBI and FAA had violated the principles of natural justice, as they had not given any personal hearing to the Appellant Bank before passing their decisions in the matter. No reasons were given for not offering personal hearing in the first appeal. He further submitted that a careful appreciation of the grounds of appeal would reveal that the FAA has failed to appreciate the legal position and other attendant factors while deciding on the application made by the RTI Applicant. As elucidated in the grounds of appeal, this is a matter of serious concern for the Bank and any disclosure of the Information would cause serious loss, injury and prejudice to the Bank. He further submitted that in accordance with the provisions enshrined under sec. 8(1) (d), information including commercial confidence which has the propensity to harm the competitive position of third party is exempted and as the banking sector is based on commercial trust and confidence, any disclosure without the consent of the concerned customer will not only impact the faith of investors in banks but will also harm the competitive position of the concerned customer. The Hon'ble Commission may be pleased to set aside the Order and remand the case to FAA for re- consideration purely on merits after hearing the Bank. Despite the above, if this Hon'ble Commission is of the view that the decision of the FAA is correct, in Page 2 of 8 such a situation, an opportunity to submit a further redacted version of the Information may be given, which would be in terms of the Jayantilal Judgment (as defined in para (f) of Annexure VI) and the adverse impact on reputation of the Bank owing to the leakage of private, confidential and material information to a certain extent can be contained. The Counsel has further requested to decide the above mentioned matter in the light of the Full Bench judgment of this Hon'ble Commission passed in file no. CIC/VS/A/2013/001488 and CIC/VS/A/2013/001805 dated 11.05.2017 and file no.
CIC/RBIND/A/2021/152460 & Ors. vide order dated 05.05.2022 wherein the Commission has remanded the matters to the CPIO for fresh adjudication by keeping in mind principles of natural justice.
6. The representative of the Reserve Bank of India while presenting their case inter alia submitted that the applicant, Shri Kabir Agarwal, vide his RTI application inter alia, sought, details of top 100 accounts of loan defaulters with highest amounts of outstanding debt as on 31.10.2019 etc. They further submitted that the then CPIO issued the notice under Section 11(1) read with Section 11(2) of the Right to Information Act, 2005 (RTI Act) to the third party i.e. appellant bank informing that R BI was required to disclose the information sought by Shri Kabir Agarwal, enabling appellant to make written submission within 30 days from the date of receipt of the notice as to whether the information sought by the applicant might be disclosed or not along with reasons for the same. After considering the response from Appellant Bank, the CPIO decided to disclose the details of top 100 accounts of loan defaulters with highest amounts of outstanding debt as on 31.10.2019 etc. to the applicant. He further submitted that the Hon'ble Supreme Court in RBI vs. Jayantilal N. Mistry &Ors (2016) 3 SCC 525 observed that:-
"RBI is clearly not in any fiduciary relationship with any bank. 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 applicant."
The FAA also observed that the list of borrowers as reported under CRILC by banks forms part of the record maintained by the Reserve Bank and the same is in the possession of the Reserve Bank. Hence the same may be disclosed by RBI. The FAA concluded that there was no merit in the appeal of the appellant and accordingly dismissed the bank's appeal. The respondent further contended Page 3 of 8 that in order to withhold any information sought by the applicant under the RTI Act, such information should fall within any of the exempted items under Section 8 and 9 of the RTI Act. The respondent also contended that the list of such defaulters is reported every quarter along with their names and amount outstanding. It is an automatic compilation and such information is readily available with the Reserve Bank of India.
Decision:
7. The Commission, after hearing the submissions of both the parties and after perusal of records, observes that the original RTI applicant has sought information regarding details of top 100 accounts of loan defaulters with highest amounts of outstanding debt as on 31.10.2019 etc. The CPIO, Reserve Bank of India had issued notices under Section 11(1) and 11(3) to the appellant bank intending to disclose the information. Aggrieved by the decision of the CPIO, the appellant bank had filed first appeal with the First Appellate Authority. The FAA had also dismissed the first appeal of the appellant bank summarily. The Commission observes that the RTI applicant had insisted for disclosure of information as per Jayantilal N. Mistry's case. The Appellant Bank contested that the information sought as a whole is exempted from disclosure under Section 8 (1) (j), Section 8(1) (d) and 8(1) (h) of the RTI Act and that the CPIO/FAA has not passed any reasoned order settling their objections nor gave any opportunity of hearing to them.
8. The Commission takes note of the submissions made by the Bank that the information, proposed to be disclosed is in the nature of credit information and the same was supplied to the Reserve Bank of India in fiduciary capacity as the Regulator under the provisions of the Banking Regulation Act as well as the Credit Information Companies Regulation Act, 2005 (CICRA). Under the provisions of CICRA there is a specific bar on the disclosure of such credit information. Further Section 174 (a) of the Act, clearly mentions that "no credit information shall be disclosed to any person other than its specified users."The large amount of data relating to its clients including their identity, personal details etc. is shared with the regulator, without any redaction or withholding the information, in good faith that these will be objectively analysed in discharge of their statutory obligations to make fair judgment on their functioning without affecting their competitive position.To this extent, there is an element of trust and confidence in sharing the data, both financial and Page 4 of 8 operational, between the RBI and the bank. The information and data of the clients in the hands of Bank also has the element of trust and confidence that such data will not be disclosed or shared against their right to privacy/commercial interest.
9. There are apparently two set of such information which have been shared by the bank with the regulator under statutory obligation. First is the information/data of clients relating to their business/commercial operations, financial transactions, business and commercial strategy which is shared by clients with financial institutions in full trust and confidence and is held by them in fiduciary capacity, protected from disclosure under the RTI Act in their hands. Second set is the information relating to business strategy, decisions, transactions, other operational data etc. of financial institution which may have bearing on their competitive position and also enjoys the exemption from disclosure in their hands, if it is a public authority or otherwise, under the RTI Act. The Commission is of the view that the exemption of disclosure of certain information under Section 8(1) of the RTI Act, 2005 in the hands of financial institutions does not evaporate once such data/information is shared, in good faith and trust, with the regulator under statutory obligations. This aspect is not the ratio of Hon'ble Supreme Court in Jayantilal Mistry's judgment and decision of the regulator to consider redacting such data/information while disclosing the reports is to be aligned with this and other judicial pronouncements of Supreme Court and High Courts covering such aspects.
10. The Commission further observes that orders simpliciter irrespective of the different objections raised by the appellant bank apparently lacked application of mind or reasons on the part of the CPIO. Reasons for rejection or acceptance of the specific objections raised by them has not been spelt out in the order which has been passed without giving an opportunity of hearing to them.The Commission further observes that the CPIO is free to take decisions on disclosure of information as per provision of RTI Act, 2005 giving a reasoned orders on the objections filed. The CPIO while issuing notice under Section 11 of the RTI Act has given the opportunity to the Appellant Bank to file their objections, if any, against disclosure of information sought but has not found it necessary to give them an opportunity of hearing. While not doing so, the CPIO has not passed any reasoned order covering his deliberations on their objections, his understanding of law or jurisprudence in deciding specific objections, in favor of disclosure etc. Order passed by the CPIO is cryptic, Page 5 of 8 without any reference to objections raised by the Appellant Bank. Similarly, the FAA instead of passing a speaking order have also given a cryptic order to the Appellant Bank. The CPIO and the FAA are expected to apply their mind and pass reasoned order elaborating reasons for accepting /not accepting their objections in his decision before issuing the intent of disclosing the information. Further, no opportunity of personal hearing was given to the appellant nor speaking order have been passed by FAA for not giving such opportunity of hearing. The Commission is of the view that every objection should be dealt and rejected/accepted with a reason and reasons for not giving opportunity of personal hearing should be well reasoned too in view of wider implications.
11. The Commission observes that rightful claims of the RTI applicant has to be adjudicated in the light of specific objections filed by the Appellant Bank, various judicial pronouncements of Hon'ble Supreme Court and High Courts providing guidance on such matters. Opportunity of hearing should necessarily be provided and orders passed by the CPIO and the FAA otherwise should be reasoned, speaking and clear. In the present case, such order should enumerate the principles for disclosure or non-disclosure of list of defaulters of Appellant Bank or various types of data, personal information, commercially sensitive information of clients or institution, specifically excluded disclosures under various Acts, etc.
12. In light of the above observations and considering all the facts and circumstances of the above mentioned cases, the Commission is of the view that contour of the arguments are identical as held in the Full Bench judgment of this Hon'ble Commission passed in file no. CIC/RBIND/A/2021/152460& Ors. vide order dated 05.05.2022. It has been observed that there are minor variations in the matters in hand when compared with the matters already decided by the Commission as above.
13. It has already been stated supra that detailed view in file nos. CIC/RBIND/A/2021/152460 & Ors. dated 05.05.2022 wherein issues of redaction, ratio of Jayantilal Mistry case and other related issues are discussed in detail. Perusal of the relevant paragraphs in Jayantilal Mistry judgment make it clear that the fundamental rights enshrined upon the citizens in form of right to information are not absolute and that the right to information may not draw precedence over right to privacy. Therefore, the Courts need to strike a balance between the rights as well as protections guaranteed to a citizen under Article 19 of the Constitution. Hon'ble Supreme Court of India has held that the disclosure Page 6 of 8 of information relating to banks may be allowed taking into account the circumstances and nature of information sought for and not in a blanket manner. The Commission advised the CPIO to consider taking the relevant references from the said order while deciding the above mentioned cases.
14. Further, the Commission has already outlined the deficiency in the conduct of the CPIO/FAA while hearing such matters and hence is of the opinion that due care has to be taken by according opportunity of personal hearing and making reasoned order with reference to the objections in the hands of the CPIO and later in the hands of FAA, if any appeal is preferred. Hence, the CPIO will be required to adjudicate such RTI applications in the light of the observations of the Commission afresh. The Commission also expects that the CPIO will take view on various objections filed by the Appellant and submissions made by applicant to reach the decision in favor or against on case to case basis. He has to factor the observation of Hon'ble Supreme Court in Jayantilal Mistry case, Commission's judgment dated 05.05.2022 and other relevant judgments. Hence, with these observations the order passed by the CPIO and FAA in this matter is set aside and the case is being remanded to the CPIO for adjudication afresh in line with the Commission full bench decision passed in file nos. CIC/RBIND/A/2021/152460 & Ors. dated 05.05.2022. In case, the appellant/applicant is aggrieved with the order of the CPIO, they are at the liberty to file first appeal before the First Appellate Authority and afterwards second appeal before the Commission.
15. With the above observations, the appeal is disposed of.
16. Copy of the decision be provided free of cost to the parties.
नीरजकु मारगु ा)
Neeraj Kumar Gupta (नीरजकु ा
सूचनाआयु )
Information Commissioner (सू
दनांक / Date : 11-07-2022
Authenticated true copy
(अिभ मािणतस यािपत ित)
S. C. Sharma (एस. सी. शमा ),
Dy. Registrar (उप-पंजीयक),
(011-26105682)
Page 7 of 8
Addresses of the parties:
1. CPIO
Reserve Bank of India,
Department of Banking Supervision,
Centre-1, World Trade Centre,
Cuffe Parade, Colaba, Mumbai- 400005
2. Mr. T V Sudhakar (Appellant Bank)
3. Mr. Kabir Agarwal (Original Appellant)
Page 8 of 8