Central Information Commission
Jayadesh V. vs Reserve Bank Of India on 29 September, 2023
Author: Saroj Punhani
Bench: Saroj Punhani
के ीय सूचना आयोग
Central Information Commission
बाबागंगनाथमाग , मुिनरका
Baba Gangnath Marg, Munirka
नई द ली, New Delhi - 110067
File No : CIC/RBIND/A/2022/600366
Jayadesh V.
(Union Bank of India) ......अपीलकता /Appellant
VERSUS
बनाम
CPIO,
RESERVE BANK OF INDIA,
NODAL CPIO, RTI CELL,
ENFORCEMENT DEPARTMENT,
CENTRAL OFFICE, MEZZANINE FLOOR,
MAIN BUILDING, FORT,
MUMBAI-400001 .... ितवादीगण /Respondent
Date of Hearing : 21/09/2023
Date of Decision : 21/09/2023
INFORMATION COMMISSIONER : Saroj Punhani
(Note: The instant appeal has been filed by the third party i.e. Union Bank of
India aggrieved by an order passed by the FAA, RBI).
Relevant facts emerging from appeal:
RTI application filed on : 26/04/2019
CPIO replied on : 12/07/2019
First appeal filed on : 22/07/2019
First Appellate Authority order : 09/11/2021
2nd Appeal/Complaint dated : 24/12/2021
1
Information sought:
The RTI applicant Girish Mittal filed an RTI application dated 26.04.2019 seeking the following information:
"(a)Kindly provide copies of inspection reports of ICICI Bank, AXIS Bank, Yes Bank, HDFC Bank & State Bank of India from, Bank of Baroda, Punjab National Bank, Union Bank of India from 1st April 2015 till date.
(b)Kindly provide copies of any show cause notices issued to banks mentioned in point(a), response to the show cause notices and action taken, if any, by RBI.
(c) Kindly provide list of defaulters of loans greater than 50 crores as available with RBI.
(d)Copies of case files with file notings on various irregularities detected by RBI in case of Sahara Group of companies and erstwhile Bank of Rajasthan by these entities themselves and their known/unknown promoters.
(e)Kindly provide information on amount spent in form of fees of lawyers, out of pocket expenses along with any other charges spent by RBI in defending the cases against the orders of CIC in High Courts/Supreme Court.
Kindly provide list giving details in each case or provide copies of challans, invoices, bills etc with file notings, approvals et al. This information needs to be provided even if it is not available on consolidated basis and spread across various files.
(f)Kindly provide information on the directory of employees of RBI which is required to be declared as per 4(1)(b)(10) with their email ids. The details on website do not give their, mobile phone s(if paid by RBI) and email id."
The CPIO vide its letter dated 12.07.2019 had sent a notice u/s. 11(3) of the RTI Act to the Appellant bank i.e. Union Bank of India stating as under:
"Please refer to our letter EFD.CO.RTI No. 946/07.03.001/2018-2019 dated May 29, 2019 wherein we had issued a notice under section 11(1) read with section 11(2) of the Right to Information Act, 2005 with respect to a RTI request No. RTI RBIND/R/2019/51887/4 received from Shri Girish Mittal to 2 enable you to make a written submission as to whether the Show Cause Notices, your replies thereto and the Speaking Orders dated July 26, 2017 (2 Orders), August 30, 2018, January 31, 2019 and February 25, 2019 passed by RBI may be disclosed to the applicant or not along with reasons for exemption from disclosure under any clause of RTI Act, 2005.
After considering your response dated June13, 2019 to the above notice, it has been decided to disclose to the applicant the Show Cause Notices, your replies thereto and the Speaking Orders dated July 26, 2017 (2 Orders), August 30, 2018, January 31, 2019 and February 25, 2019 passed by RBI, after severing under section 10 (1) of RTI Act, 2005 the information exempt from disclosure. Accordingly, notice of the decision taken in the matter is hereby being given as required under Section 11(3) of the RTI Act 2005. Copies of the aforesaid documents after duly severing the information exempt from disclosure are enclosed."
Being dissatisfied, the Appellant Bank through its authorized representative filed First Appeal dated 22.07.2019. FAA's order, dated 09.11.2021, upheld the reply of the CPIO.
Feeling aggrieved and dissatisfied, the Appellant bank approached the Commission with the instant Second Appeal.
Relevant Facts emerging during Hearing:
The following were present:-
Appellant: Present through Video-Conference.
Respondent: Sunil Kumar Jha, DGM and Suman Choudhary, Legal Officer present through Video-Conference.
Original RTI applicant: Not Present.
The written submissions of the Appellant and the Respondent are taken on record.
The Authorized Representative of the Bank submitted on the lines of the written submissions stating as under:
"3. However, the CPIO, RBI, vide notice dated 12.07.2019 issued to Bank u/s 11 (3) of the Act (Annexure 4) rejected our objection and conveyed the intention to 3 disclose the Show cause notices, bank's replies thereto and the speaking orders dated July 26, 2017 (2 Orders), August 30, 2018, January 31, 2019 passed by RBI, after severing the information exempt from disclosure as per S. 10(1) of the Act.
Aggrieved by the said decision, the Bank filed a First Appeal, on 22.07.2019, before the First Appellate Authority of the RBI on the grounds mentioned in the said Appeal Memo (Annexure 5). The FAA, after considering our appeal, dismissed the said First Appeal vide its order dated 09.11.2021 (Annexure 6). Aggrieved by the order by the FAA, RBI, the present Second Appeal has been preferred before the Hon'ble Central Information Commission by the Bank.
4. It is submitted that the information sought by the Applicant is personal and third- party information that are exempted from disclosure under Section 8 (1) (d),
(e) & (j) of the RTI Act, the disclosure of which has no relationship to any public activity or interest and would cause unwarranted invasion of the privacy of the individual as well as would harm the competitive position of the third parties. In addition to the above, it is pertinent to mention that sending of notice by CPIO, RBI under Section 11 (1) and Section 11 (3) to Union Bank of India expressing its intention to supply the information sought under the RTI Act regarding the individual information of the borrowers of Union Bank of India does not comply with the statutory requirements of Section 11. As per the requirements of Section 11 (1) where a CPIO, as the case may be, intends to disclose any information or record, or part thereof on a request made under the Act, which relates to or has been supplied by a third party and has been treated as confidential by that third party, the CPIO, shall give a written notice to such third party of the request and of the fact that the CPIO intends to disclose the information or record, or part thereof, and invite the third party to make a submission regarding whether the information should be disclosed. Therefore, since the information belongs to the Bank's borrowers and account holders and the Bank is only a custodian of the information related to the accounts of its borrowers and account holders, which it holds in its fiduciary relationship with them, the notice under Section 11 (1) and Section 11(3) should have been sent to the borrowers and account holders and not the Bank.
5. We submit that, our Bank has filed a Writ Petition before the Hon'ble Supreme Court, seeking quashing of the similar dismissal orders passed by the FAA of the RBI in respect of objections of the Bank under Sec. 11 of the RTI Act (in an RTI Application filed by Dheeraj Mishra) and further prayer to direct the RBI, not to disclose without concurrence of Banks, any information/data collected by RBI in course of inspections, audit or specific directions in exercise of its powers as regulator of Banks, including information about customers, management of the banks, business plans, trade secrets, risk ratings and other regulatory information 4 and unpublished price sensitive information. The said Writ Petition has been registered and numbered as W. P. (C) No. 690/2021 and is pending adjudication before the Hon'ble Supreme Court and has since been tagged with other simitar Writ Petitions filed by different Banks, for analogous hearing. A copy of the aforesaid Writ Petition can be submitted to this Hon'ble Commission as and when directed. Hon'ble Supreme Court vide Order dated 30/09/2022 in the Writ Petition No. 1159/2019 [HDFC Bank Ltd. versus Union of India] and a batch of other similar matters, whereby dismissing the Interim Applications filed by Information Applicant(s), the Hon'ble Court observed that, "..42. Without expressing any final opinion, prima facie, we find that the Judgment of this Court in the case of Jayantilal N. Mistry (supra) did not take into consideration the aspect of balancing the right to information and the right to privacy..." It is pertinent to mention here that the aforesaid Writ Petitions are pending adjudication before the Hon'ble Supreme Court.
6. Here the appellant Bank wishes to draw the kind attention of the Hon'ble Commission to an order passed by a Division Bench of this Hon'ble Commission dated 05.05.2022 in a bunch of appeals filed by ICICI Bank & others Vs. Reserve Bank of India (Applicant Girish Mittal) wherein while observing that "xxx any decision of redaction or disclosure of information, without waiting for decision in the Writ Petition Nos. 1159/2019 and 768/2021 and others tagged may cause irrevocable damage against right of privacy and protection of commercial interest" have been pleased to direct that "fxxx the respondent public authority if expedient may wait for the outcome in Writ Petition Nos. 1159/2019 and 768/2021 and others tagged or seek clarification from the Hon'ble Court and accordingly decide these RTI applications by following process as enumerated in the earlier paras by the Commission in the interest of principles of natural justice xxx" the appeals have been disposed of.
7. It is further submitted that "show cause notices issued to banks mentioned in point (a), response to the show cause notices and action taken" are part of data examined by RBI and have to be read in its entirety as well as in the appropriate context to have a holistic understanding of the same. The observations made therein are best handled by the respective subject specialists only and making it available to public at large might lead to erroneous interpretations and consequentially, to unwarranted and avoidable impact on the standing of the entire banking system. Hence, disclosure of such information, under no circumstances were supposed to be provided to a third person i.e. the RTI applicant.
8. It is submitted that the CPIO and the FAA failed to appreciate the fact that, disclosure of confidential information to public at large would jeopardize the 5 market value, goodwill and business plans of the Appellant Bank. At the same time the confidential, sensitive and private information of the customers of the bank which are held in fiduciary capacity, if disclosed without their consent, would affect the trust reposed by the public. Needless to mention that would not only affect the functioning of the banking and financial services sector of the country, but such disclosure would also prejudicially affect the Appellant Bank's functioning and business. Thus, to sum up, disclosure of the said information would result in violation of the right to privacy as enshrined in the Article 19(1)(g) of the Constitution. Furthermore, in the absence of any justification, as to how disclosure of the desired information is considered to be in larger public activity or interest, its disclosure would cause unwarranted invasion into the privacy of the individuals/customers. The proposition of the FAA for severed or piece-meal disclosure of the said information under the RTI Act either by redacting some portions or otherwise would present a distorted picture of the business of the Appellant Bank which would prejudicially affect the economic interests of the State thereby harming the overall public sentiment also. Hence, such information has to be exempt from disclosure under section 8(1) (a) of the Act.
9. In view of the fact that the Hon'ble Supreme Court is seized of the legal issue as to whether the desired information is exempt from disclosure under the RTI Act, 2005, and the view which has been taken by the Division Bench of the Hon'ble Commission in file bearing no. CIC/RBIND/A/2021/152460 dated 05.05.2022, "any decision of redaction or disclosure of information, without waiting for decision in the Writ Petition Nos. 1159/2019 and 768/2021 and others tagged may cause irrevocable damage against right of privacy and protection of commercial interest. Hence, the respondent if expedient may walt for the outcome in Writ Petition Nos. 1159/2019 and 768/2021 and others tagged or seek clarification from the Hon'ble Supreme Court and accordingly decide these RTI Applications", it is humbly prayed that the present appeal may be allowed and the order passed by the First Appellate Authority/CPIO dated 09.11.2021/12.07.2019 may please be set aside......."
The Respondent submitted on the lines of the written submissions filed by their CPIO stating as under:
"3. lt is submitted that Shri. Girish Mittal (the applicant) had, vide his RTI application bearing No. RBIND/R/2O19/51887 dated April 26,2019, inter alia, sought for copies of show cause noticcs (SCNs) issued to eight banks [i.e. Punjab National Bank (PNB), State Bank of lndia (SBl), Bank of Baroda (BOB), Axis Bank, Union Bank of lndia (UBl), lClCl Bank, Yes Bank and HDFC Bank and response 6 thereto along with action taken by RBI from April 1, 2015 till the date of his application.
4. Since the above sought information is relating to third parties i.e. eight banks (including UBI), the then CPIO, EFD issued a notice dated May 29,2019 under Section 1 1 (1) read with Section 1 1 (2) of the Right to lnformation Act 2005 (RTl Act) to the appellant informing it about his intention to dlsclose the documents, the details of which were given in the said notice, highlighting the information which is exempt from disclosure under Section 8('l) of the RTI Act. The appellant had filed its objection to the said notice yrde its letter dated June 13,2019. After duly considering the objections raised by the appellant, the CPIO issued a notice dated July 12, 2019 (enclosed as Annex- D) under Section 11(3) of the RTI Act to the appellant communicating his decision to disclose the information to the applicant after severing the information exempted from disclosure as per Section 10(1) of the RTI Act.
5. lt is humbly submitted that the CPIO followed the procedure as contemplated under Section 11 of the RTI Act and duly considered the objections filed by the appellant in response to the notice dated May 29, 2019. Dissatisfied with the decision of the CPIO to disclose the information as sought by the applicant, the appellant preferred first appeal bearing No. RBIND/A/20'19/60340 dated July 22, 2019 before the First Appellate Authority (FAA) of RBl.
6. That the FAA duly considered the contentions raised by the appellant in the appeal and dismissed the first appeal, vrde his common order dated November 09,2021. While dismissing the appeal, the FAA referred to and relied upon the judgement of the Hon'ble Supreme Court in Reserve Bank of lndia v. Jayantilal N Mistry & Orc. (2016) 3SCC 525 and stated that the grounds raised by the appellant in the appeal are no more res integra. The FAA observed that the issues regarding commercial confidence, third party information, fiduciary capacity, economic interest of nation etc. were argued before the Hon'ble Supreme Court in the said case and the Hon'ble Apex Court rejected all these arguments and Article 141 of the Constitution stipulates that the law declared by the Hon'ble Supreme Court shall be binding on all courts within the territory of lndia. The FAA observed that the CPIO intended to disclose the information in question only after duly severing the information exempt from disclosure under Section 8 read with Section 10 of the RTI Act.
XXXXXXXX It is submitted that none of the pre-conditions for remand as identified in the above decision exist in matters such as the present appeal. As the matters are elaborately heard personally before this Commission, it is not necessary to direct further personal before the CPIO or also before the FAA especially when the issue 7 relates to and binding nature of the judgments of the Supreme Court in Jayantilal N. Mistry case and Grh.sh Mittal ease. The CPIO and FAA have been passing orders clearly elucidating the reasons for allowing an application for information under the RTI Act after considering the submissions made by banks and there is no doubt on the reasons that prevailed upon the CPIO and the FAA. Therefore, in view of the above findings of the Courts, it is respectfully submitted that this Hon'ble Commission may dispose of the present appeal without remanding the matter to the CPIO or the FAA.
14.1t is thus submitted that the action taken by the CPIO and the order dated November 09,2021 passed by the FAA are strictly in compliance with the provisions of the RTI Act and the observations of Supreme Court in Jayanatilal N. Mistry (supra) and other cases as mentioned above. Since the CPIO and the FAA have fulfilled their mandate under the RTI Act, 2005, the appeal is devoid of any merit and deserves to be dismissed. The original RTI applicant Shri Girish Mittal submitted that it is the legal duty of the RBI to disclose complete information to him as per Jayantilal Mistry's case."
Decision:
In the facts of the instant case, it is pertinent to note that a decision of a coordinate bench of the Commission in the matter of various third-party banks vs. RBI vide File No. CIC/RBIND/A/2021/152460 + Ors. dated 05.05.2022 covers a detailed discussion inter alia on the same nature of information sought for from the RBI and the reliance placed by RBI on the Jayantilal Mistry case. Suffice to say that the issues raised in the instant case are encapsulated in that same discussion of the coordinate bench in the following manner:
"39. A comprehensive view has to be taken on the objection filed by the institutions. These objectives has to be deliberated and adjudicated in the light of Jayantilal Mistry's case and other judicial pronouncements relevant in such matter, some of which have been referred by the Commission in the above parts as well. The Commission while examining various objections realize that the Writ Petitions filed before the Hon'ble Supreme Court of India is seeking directions of the Supreme Court for non-disclosure of certain aspects of these audit/inspection report and any such guidance in these Writ Petitions will have direct bearing and provide further clarity to the CPIO/FAA in adjudicating various aspects of disclosure/non-disclosure of reports or the information/data which are part of these reports under the provisions of the RTI Act. The Commission takes note that 8 all the cases/second appeals filed herein are based on interpretations of RBI Vs. Jayantilal Mistry case and other relevant judicial pronouncements requesting for full disclosure vis-à-vis with exemptions under Section 8(1) of the RTI Act for non- disclosure of full or parts of these reports.
40. In view of the above observations, the Commission is of the view that the reports generated in the hands of regulatory public authority in discharge of its statutory obligations are information under Section 2 (f) of the RTI Act, as the regulator and the regulated entities are not governed by fiduciary relationship. The orders of the Commission to their effect has been upheld by the Hon'ble Supreme Court in Jayantilal Mistry's case and the position is unchanged even today. Various objections filed by banks/financial institutions, to be examined, analyzed and adjudicated upon, are related to various data and information submitted to the Reserve Bank of India by these financial institutions explaining their operations, commercial decisions, clients data etc. under statutory obligations can be disclosed as such. There are apparently two set of such information which have been shared by the institutions 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 institutions have been bearing on their competitive position which also enjoys the exemption from disclosure in their hands, if it is a public authority or otherwise, under the RTI Act. Some of such data, on case to case basis be sensitive enough for protection of national interest. The Commission is of the view that the protection of disclosure of 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 obligation. Various observations of Hon'ble Supreme Court in Jayantilal Mistry's case also does not indicate so and decision of the regulator to consider redacting such data/information while disclosing the reports is aligned with this and other judicial pronouncements of Supreme Court and High Courts.
41. 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 9 afresh. The Commission also expects that the CPIO will take view on various objections filed by the Banks and Financial Institutions and submissions made by applicant to reach the decision in favour or against redaction of various parts of the report on case to case basis. He has to factor the observation of Hon'ble Supreme Court in Jayantilal Mistry case and other relevant judgments, some of which have been referred in this order as well. Hence, with these observations the orders passed by the CPIO and FAA in these matters are set aside and the cases are being remanded to the CPIO for adjudication afresh. (Emphasis Supplied)
42. It is amply clear that Writ Petition Nos. 1159/2019 and 768/2021 and others tagged are admitted in Hon'ble Supreme Court wherein guidance and direction has been sought on non-disclosure of certain type of information which are essentially the part of the Annual Inspection Report/RAR, etc. These petitions also seek protection of interim communication between regulator and the regulated entity in the process of finalization of these reports or otherwise. It is obvious that decision in these Writ Petitions will provide clarity and guidance to the Public Authority on redaction/non-disclosure of a set of information inspite of being part of these reports which are open to disclosure. At this stage, any decision by the Public Authority will amount to pre-judging the issues pending admitted Writ Petitions before the Hon'ble Supreme Court. Various banks, financial institutions, respondent public authority and the RTI applicant have already impleaded party and are presenting their arguments before the Apex Court.
43. Hence, any decision of redaction or disclosure of information, without waiting for decision in the Writ Petition Nos. 1159/2019 and 768/2021 and others tagged may cause irrevocable damage against right of privacy and protection of commercial interest. Hence, the respondent public authority if expedient may wait for the outcome in Writ Petition Nos. 1159/2019 and 768/2021 and others tagged or seek clarification from the Hon'ble Court and accordingly decide these RTI applications by following process as enumerated in the earlier paras by the Commission in the interest of principles of natural justice. While disclosing the information they should be cautious in taking a considerate view balancing right to privacy, protection of national and commercial interest on one hand vis-à-vis larger public interest. (Emphasis Supplied)
44. It is further observed that similar view has also been taken by the Division Bench of the Commission in file bearing nos. CIC/VS/A/2013/001488 and CIC/VS/A/2013/001805 dated 11.05.2017 wherein the Commission observed that 'Having considered the submissions of both the parties, the Commission observes that since a similar issue is pending adjudication before the Hon'ble Supreme Court in the matter of Central for Public Interest Litigation Vs. Housing & Urban 10 Development Corporation Ltd. &Ors., it would be judicious to await the final outcome from the Hon'ble Supreme Court. However, on receipt of the final outcome from the Hon'ble Supreme Court in the matter, the appellant shall be at liberty to file second appeal afresh, if he so desires. The instant appeals are disposed of'."
The above decision is therefore applicable to the instant case and no separate line of adjudication is warranted in the matter. The stipulations contained in para 41 & 43 to which emphasis has been supplied as above stands endorsed to the Respondent CPIO in the instant case as well and necessary action be taken in this regard.
The appeal is disposed of accordingly.
Saroj Punhani (सरोज पुनहािन) हािन) Information Commissioner (सूचना आयु ) Authenticated true copy (अिभ मािणत स#यािपत ित) (C.A. Joseph) Dy. Registrar 011-26179548/ [email protected] सी. ए. जोसेफ, उप-पंजीयक दनांक / 11