RBI held to be subject to Right to Information Act

By Vivek Vashi and Krishnendu Sayta, Bharucha & Partners
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The Supreme Court recently decided several transferred matters on the issue of whether the Reserve Bank of India (RBI) can deny information sought by third parties under the guise that divulging of information would violate its fiduciary relationship with banks or be prejudicial to the “economic interest” of the country. The RBI had invoked the exemptions under section 8(1)(a), (d) and (e) of the Right to Information Act, 2005 (RTI Act), to refuse disclosure of even basic information such as details of wilful defaulters.

Vivek_Vashi_-_Bharucha_&_Partners
Vivek Vashi

In RBI v Jayantilal N Mistry, the RBI argued that the RTI Act (being a general act) could not supersede the special statute under which the relevant banks had shared information. Moreover, the RBI should be permitted to refuse disclosure of information which it believed would prejudice the economic interests of the state.

The Supreme Court observed that section 22 of the RTI Act clearly stated that the RTI Act superseded all acts, including the Official Secrets Act. In any event, since the RTI Act was a later statute for a specific purpose, it would override earlier general statutes.

Krishnendu_Sayta_-_Bharucha_&_Partners
Krishnendu Sayta

The court held that the test under section 8 of the RTI Act was whether giving information to the public would be detrimental to the economic interests of the country. Applying the test, the court found that information in relation to currency, foreign investment and proposed expenditure may not be released but information in relation to errant bankers and wilful defaulters ought to be made available.

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Vivek Vashi is the mainstay of the litigation team at Bharucha & Partners, where Krishnendu Sayta is an associate.

bharuchaBharucha & Partners Advocates & SolicitorsCecil Court, 4th Floor, MK Bhushan RoadMumbai-400 039IndiaTel: +91-22 2289 9300Fax: +91-22 2282 3900E-mail: sr.partner@bharucha.in