| Actions by public authorities that impact the day-to-day operations and public authorities are funded by the tax paid by the public. However, there is a fine distinction when it comes to the role of entities that are not public authorities, but whose actions may have an element of public interest. |
| To rule that every stock exchange in India is a "public authority", the CIC has primarily relied upon the fact that stock exchanges need recognition from the Securities and Exchange Board of India (SEBI) to act as one. That SEBI has powers to supersede the board of a stock exchange and that exchanges' bye-laws have statutory force has also weighed heavily with the CIC. |
| The CIC has relied upon a decision of the Delhi high court which had ruled that the "deep and pervasive" control of SEBI over stock exchanges would make their actions amenable to a challenge in the high court using the route of writ petitions. However, from an RTI Act perspective, the implications are far more wide-ranging. Any member of the public can now seek information from a stock exchange about any aspect of its functioning and decision-making and the exchange would have to deal with it. |
| This could range from seeking to know its costs, commercial reasons for any decision it takes, and contents of agreements to which it is a party. A refusal to provide information, although it may be based on the grounds specified in the RTI Act, could lead to several layers of appeals. The cost of initiating a request for information is next to nothing and not even commensurate with the commercial nature of playing the stock market. This opens the doors to harassment of commercial enterprises that stock exchanges are, by operators and manipulators whose actions the exchanges may seek to curb. |
| It has not mattered to the CIC that stock exchanges are but companies under Indian company law set up for a commercial purpose of making profit "� they are not departments of the government. If every commercial entity that is under the deep and pervasive control of government, and whose functions are of a public character, is a public authority, the implications would be far-reaching. |
| The CIC's order has exposed the entire gamut of private enterprises that perform functions that have a popular reach to the prospect of being "public authorities". For example, every telecommunication service provider, airline company, airport operator, builder and operator of toll-roads, and in fact, every builder of residential and commercial property, every television channel, radio channel, private taxi operator, tempo, truck and commercial service operator, port operator, bank, stock broker, custodian, mutual fund, insurance company, private schools "� just about every business that needs a licence and whose reach impacts the public "� would be a "public authority". |
| If the Communist Party of India (Marxist) has its way with its proposed retail sector policy (it wants every retailer to be issued a license from government), every retail store would be a public authority "� they would be under the control of the government and their functions would have public character. It should matter little that these enterprises are but commercial enterprises in pursuit of profit. Each of them would have to designate information officers and provide for an appellate process within their organisations. |
| All such institutions ought to have a good public relations policy "� one that has a good means of ensuring that the users of their services and products are well placed and comforted with transparent functioning. Terming them as "public authorities" would only serve to hold the doors of the government ajar for even more intervention. Soon, the Comptroller and Auditor General (CAG) may want to audit such business enterprises (in fact cases of the CAG seeking to enter into the premises to inspect books of such institutions abound). |
| The author is a partner of JSA, Advocates & Solicitors. The views expressed herein are his own. somasekhar@jsalaw.com |
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