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Important Judgements of the Supreme Court in 2015 | Part 5



Catch up on the previous links to this series:


#9. RBI bound to disclosure under RTI

Reserve Bank of India vs. Jayantilal Mistry

Summary:

Coming down heavily on the Reserve Bank of India (RBI) for depriving information under the RTI Act, 2005 in the name of fiduciary relationship between itself and the banks, the Supreme Court has in a landmark decision declared that RBI does not place itself in a fiduciary relationship with the Financial institutions 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.

SC observations:

  • 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 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.
  • The RBI and the Banks have sidestepped the General public’s demand to give the requisite information on the pretext of Fiduciary relationship and Economic Interest.
  • This attitude of the RBI will only attract more suspicion and disbelief in them. RBI as a regulatory authority should work to make the Banks accountable to their actions

Counterview:

  • Information sought for is exempted under Section 8(1)(a), (d) and (e) of the Right to Information Act, 2005
  • As the regulator and supervisor of the banking system, the RBI has discretion in the disclosure of such information in public interest
  • The disclosure of information would prejudicially affect the economic interest of the State
  • Further, if the information sought for is sensitive from the point of adverse market reaction leading to systematic crisis for financial stability

What is RTI Act Section 8?

(1) Notwithstanding anything contained in this Act, there shall be no obligation to give any citizen,—

(a) 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;
(d) 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 of such information;
(e) information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information;

What is a ‘fiduciary relationship’?

  • Where one person places complete confidence in another in regard to a particular transaction or one’s general affairs or business.
  • The relationship is not necessarily formally or legally established as in a declaration of trust, but can be one of moral or personal responsibility, due to the superior knowledge and training of the fiduciary as compared to the one whose affairs the fiduciary is handling

#10. Acid Attack Victims in disability list

Parivartan Kendra vs. Union of India

Summary:

The Supreme Court has directed all the States and Union Territories to consider the plight of Acid Attack victims and take appropriate steps with regard to inclusion of their names under the disability list. Apex court bench of Justices M.Y. Eqbal and C. Nagappan said that State shall upon itself take full responsibility for the treatment and rehabilitation of the victims of acid attack as per the Guidelines provided in Laxmi vs. Union of India.

SC observations:

  • The State has failed to check the distribution of acid falling into the wrong hands even after giving many directions by this Court in this regard. Henceforth, a stringent action be taken against those erring persons supplying acid without proper authorization and also the concerned authorities be made responsible for failure to keep a check on the distribution of the acid.
  • Laxmi’s case doesn’t put a bar on the Govt. to award compensation limited to Rs.3 Lakhs. The State has the discretion to provide more compensation to the victim in the case of acid attack.
  • The enhancement of the Compensation will act in two ways
  1. It will help the victim in rehabilitation
  2. It will also make the State to implement the guidelines properly as the State will try to comply with it in its true sprit so that the crime of acid attack can be prevented in future.

State shall upon itself take full responsibility for the treatment and rehabilitation of the victims of acid attack as per the Guidelines.


Published with inputs from Swapnil

Questions, suggestions and comments


  1. Udit Agarwal

    Is the govts role as the caretaker of the country’s natural resources, a fiduciary relationship between itself and the people? Just asking

    1. Pranav

      Yes, probably because the govt appoints specialists to arrive at worth of resources and auctions/leases them to obtain money by which to finance different developmental activities.

      But I don’t think it could be exempted under RTI except for defense and security purposes.

  2. Udit Agarwal

    Is state aided rehab mandated for any other crime/circumstance?

  3. abhinav sharma

    Has any of the state govt included the names of such ppl in disability list after the courts directives?
    is there any state following this practice well in advance of the directions by the apex court ?
    what guidelines have been issued by the courts in this regard ?

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