Why is it in News?

The Supreme Court has given RBI a last chance to withdraw a November 2016 Disclosure Policy and abide by the Right to Information Act.

About RBI:

  • Reserve Bank of India was established on 1st April, 1935.
  • Reserve Bank of India is the central banking institution, which regulates the monetary policy of the Indian rupee, under the Reserve Bank of India Act, 1934.
  • RBI is not a commercial bank.
  • RBI is the lender of last resort for banks, it looks into the exchange rate of Indian currencies, regulates commercial banks etc.

What is RBI’s Argument against not abiding by the RTI Act?

  • RBI has cited Section 8 of the RTI Act, which exempts the Public Authority to release the information in public domain if it can hamper the state’s economic interest. RBI was pointing that disclosure of sensitive information regarding the annual financial reports of banks will erode the faith of customer in the banking system which can have detrimental effect on the health of the Indian economy.
  • Another argument of RBI was that it gets sensitive information of the banks because of its fiduciary relationship (i.e. mutual trust), so disclosure of such information will lead to breach of trust of the banks.
  • Under RBI Act 1934, sensitive information of banks is confidential and shall not be leaked out.

How Supreme Court countered the Arguments of RBI?

  • SC opined that withholding information is valid (under Section 8 of RTI) only if it serves the larger public interest, disclosure of information will bring in the discipline and this will serve the public interest as compared to hiding the information.
  • SC also opined that RBI gets information from banks because of being a regulator and not because of Fiduciary relationship.
  • SC opined that disclosure of information in public domain will usher in an era of transparency & accountability which is the key to functioning of any institution.

Right to Information (RTI):

  • As per the RTI Act 2005, every citizen has the right to receive a timely response from the government for any information that is sought by them with respect to the functioning of the government.
  • RTI is a fundamental right under Article 19(1) of the Indian constitution.

Under the RTI, every citizen is empowered to:

  • Seek information / ask questions to the government
  • Request for copies of government documents
  • Inspect government documents and works etc.
  • Section 8 of the RTI Act deals with the exemptions under RTI Act.

Central Information Commission (CIC):

Composition of CIC- As per RTI Act, CIC consist of the Chief Information Commissioner and such number of Central Information Commissioners not exceeding 10.

Appointment- Section 12(3) of the RTI Act 2005 provides for the following:

  • i.The Prime Minister, who shall be the Chairperson of the committee;
  • ii.The Leader of Opposition in the Lok Sabha; and
  • iii.A Union Cabinet Minister to be nominated by the Prime Minister

Duration of the Office:

Section 13 of the RTI Act 2005 provides that the Chief Information Commissioner shall hold office for a term of five years from the date on which he enters upon his office and shall not be eligible for reappointment; MPs, MLA etc. are not eligible for the office of CIC.

Powers of CIC/ICs:

CIC has the power of Civil Court (like summoning etc.) when it deals with the matters related to code of Civil Procedure, and its decisions are final and binding on the party.

Source: TH, IE, Livemint