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Current Affairs

Keeping RBI inspection report confidential

Date: 20 August 2021 Tags: Judiciary & Judgments

Issue

Writ petition filed by banks to prevent disclosing of inspection report of RBI has been referred to a separate bench by the Supreme Court.

 

Background

The RBI has issued Right To Information notices to various banks to disclose the reports, which has been opposed.

 

Details

  • The issue started in 2015 when the Supreme Court had criticized the RBI for keeping its inspection report of banks confidential.

  • The banking sector was upset with the decision as public disclosure was on the cards. The SC had said that increasing profits of public or private sector was not RBI’s duty.

  • The revealing of such data to the public was RBI’s duty and upholding the Right To Information was utmost important. Then RBI started making such reports public.

  • Only some part of report such as bad loans and borrowers could be made public. Disclosing of complete inspection report and defaulter list was not done.

 

Bank’s arguments

  • Adverse remarks by RBI could move customers away from the bank. This would take profits away as well as affect their performance.

  • The banks also say that privacy is fundamental right and making customer information public will be its violation. Private Banks argue that they do not come under RTI.

  • They also fear that report will disclose mismanagement and malpractices currently plaguing majority of banks.

  • The officials do not want the information on manipulation by clients to be accessible to potential customers in future.

 

RTI Act, 2005

  • It is a legislative act made by the parliament of India to frame rules and procedures regarding citizens' right to information. The Freedom of Information Act, 2002 was replaced by this act.

  • The act envisages to protect fundamental rights to Freedom of Expression and Speech under Article 19(1)(a) and Right to Life and Personal Liberty under Article 21 of the constitution of India.

  • The act covers all constitutional structure, including executive, legislature and judiciary. Bodies that are substantially financed and controlled by the government also come under the ambit of the act.