Skip to main content

Last chance for RBI to give info on bank inspection reports under RTI: SC

The Supreme Court on Friday reprimanded the Reserve Bank of India (RBI) for refusing to disclose information pertaining to the annual inspection report on banks under the Right to Information (RTI) Act, and warned that any further attempts by the banking sector regulator to hold back such information “shall be viewed seriously by the court”.
Though the apex court held the RBI in contempt of court, it gave the regulator “one last opportunity” to withdraw the disclosure policy related to the annual inspection report on banks. The RBI, the court held, was “duty-bound under the law” to provide such information, which was otherwise exempted under law. “Though we could have taken a serious view of the respondents continuing to violate the directions issued by this court, we give them a last opportunity to withdraw the disclosure policy insofar as it contains exemptions which are contrary to the directions issued by this court,” a two-judge Bench of Justice L Nageswara Rao and Justice M R Shah said in their judgment.
Last month, the court had warned the RBI of contempt proceedings for failing to disclose information and given it one week’s time to comply with the directions or “be ready to face the consequences”. The court had in January issued a notice to the RBI on a contempt petition alleging the central bank had not provided information about the inspection conducted on some banks, said to be involved in irregularities inside the Sahara group. The petitioner alleged that the RBI had denied information regarding the inspection report on ICICI Bank, Axis Bank, HDFC Bank, and State Bank of India (SBI) despite clear orders of the top court.
Last chance for RBI to give info on bank inspection reports under RTI: SC The RBI had refused to provide information to the petitioner, claiming “fiduciary relationship” between itself and the banks in question. Such information, the regulator had then said, was exempted from being revealed under Section 8(1) (d) and (e) of the RTI Act. Section 8 allows the government to withhold from public some information in order to “guard national security, sovereignty, national economic interest, and relations with foreign states”.The information to the petitioners was denied by the RBI despite orders from the Central Information Commissioner (CIC) to do so.
However, in January 2015, a two-judge bench of the then Justices M Y Eqbal and C Nagappan, while rejecting this argument by the RBI, had held that the banking sector regulator was supposed to “uphold public interest and not the interest of banks”. The RBI, the Bench had said, was thus “clearly not in any fiduciary relationship with any bank”. “The RBI has no legal duty to maximise the benefit of any public sector or private sector bank, and thus there is no relationship of ‘trust’ between them,” the top court had then said. This behaviour of the banking sector regulator of denying information under RTI would “only attract more suspicion and disbelief in them”, the two-judge Bench had said.One of the petitioners who had sought the information from the RBI under RTI had claimed that there was a loss of nearly ~32,000 crore to the nation due to foreign derivative contract cases. The petitioner had sought a bank-wise breakup of the mark-to-market losses due to these contracts. Another petitioner, who had approached the top court after being denied information by the RBI, had sought to know the details of show-cause notice and fines imposed on various banks.
On June 30, 2016, the RBI uploaded a disclosure policy under which it claimed that the “Public Information Officers (PIO) were directed not to disclose virtually all kinds of information”. One of the exemptions under the new policy was related to the department of banking regulation and said that “information relating to specific supervisory issues emanating from inspection or scrutiny reports received from other supervisory departments” were exempted from disclosure.The RBI had again come out with a new disclosure policy on April 12, 2019. The new policy mentions that information available to a person in his fiduciary relationship can be withheld by the RBI. The RBI said that “each application received under the RTI Act would be examined in light of the provisions of the Act and any decision with respect to non-disclosure by the Bank will be supported by citing the relevant exemption provisions of the RTI Act”.
People familiar with the working of the banking sector regulator, however, said that since the SC order is now in effect and is the stronger of the two, it will be followed.“The respondents (RBI) are duty-bound to furnish all information relating to inspection reports,” the Friday judgment says.The information sought is from Annual Financial Inspection reports, which the RBI prepares as supervisor of banks. These reports focus on statutorily mandated areas of solvency, liquidity and operational health of the bank. It covers areas like capital adequacy, asset quality, management, earning, liquidity and system and control.
The Business Standard, 27th April 2019

Comments

Popular posts from this blog

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

  Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes   The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30%   The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25)   Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6

Jaitley plans to cut MSME tax rate to 25%

Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem

Don't forget to verify your income tax return in August: Here's the process

  An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s