 "RBI declines to share details of banks inspection report")
The Reserve Bank of India (RBI) has declined to share details of banks inspection reports citing a section of the transparency law that exempts public authority from disclosing information that may prejudicially affect sovereignty, security or economic interests of the country.
Replying to an RTI query, the central bank also said furnishing the requested information will disproportionately divert the resources of the public authority.
The RBI was asked to provide copies of all the annual financial inspection reports, concurrent audit or inspection reports carried out between 2007 and 2015 on foreign currency derivative contracts sold by the 19 banks that were earlier penalised by it.
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"The requested information pertains to inspection reports of 19 banks for a period of eight years from April 1, 2007 to March 31, 2015. Therefore the total number of reports would be 152 (one report per bank for 19 banks for eight years ie 152)," the RBI said in reply to the RTI query filed by S Dhananjayan, adding, "Furnishing the requested information will disproportionately divert the resources of the public authority."
Further, disclosure of the requested information could prejudicially affect the economic interest of the state and hence exempt from disclosure under Section 8 (1) (a) of the RTI Act, 2005, it said.
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The Section bars "information, disclosure of which would prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State, relation with foreign State or lead to incitement of an offence".
The RBI had in 2011 imposed penalties on 19 banks "for contravention of various instructions issued by the Reserve Bank in respect of derivatives, such as failure to carry out due diligence in regard to suitability of products, selling derivative products to users not having risk management policies and not verifying the underlying or adequacy of underlying and eligible limits under past performance route".
The RBI also declined to share file notings giving details of the proceedings that had resulted in the levy of penalties.
"Disclosure of the requested information could prejudicially affect the economic interests of the state and hence exempt from disclosure," it said.
The Supreme Court in an order late last year observed that the RBI and the banks have sidestepped the general public's demand to give the requisite information on the pretext of "fiduciary relationship" and "economic interest".
"This attitude of the RBI will only attract more suspicion and disbelief in them. RBI as a regulatory authority should work to make the banks accountable to their actions," the apex court had said.