Recently, a beleaguered promoter of a beleaguered corporate group filed a Rs 100-crore defamation suit against adversaries for using his picture in a newspaper advertisement. The move was a bit ironical, though understandable, coming as it did amid a huge campaign involving books, pamphlets, media rounds and social media by the group, where it does not refrain from making disparaging remarks about regulators, government officials and others.
In the past, this group has also trained its guns on an academic by filing cases in remote courts for some unfriendly analysis published in a newspaper. Another group, also in trouble with regulators, had filed a case against this writer and some colleagues in a distant Bihar court, four years ago for an article published by my previous employer. That publication is contesting the case.
Then, there are the big boys, who have a pending defamation suit against every business publication in town. They also do not spare books, movies and television, if they don’t like what they see or read.
I remember a former editor who kept documents and evidence pertaining to a decade-old case in his locker, wondering “God knows when they will invoke it.”
These hanging swords, not very different from ones used by Southeast Asian autocrats, create a dangerous imbalance in news flow that goes against the fundamentals of free and fair markets. As one side of the news flow gets restricted this way, the other side, the positive news-flow of which the company is often the primary source, becomes coveted among reporters.
It is such one-sided news-flow that fuelled the Dutch courage of some Hyderabadi billionaires to climb scam tigers they could not dismount from. Even the market regulator, which seeks to restrict information asymmetry through disclosure norms, has little control over what is prevented from being published in this manner.
Prevention of the publishing of material information or analysis that might have significant impact on stock prices through such bullying should ideally be prosecuted as an unfair trade practice by the Securities and Exchange Board of India (Sebi). However, such initiative is yet to be demonstrated by Sebi. Nor has any media house taken such a course for redressal.
This great disservice to investors has continued for years, riding on Sections 499 and 500 of the Indian Penal Code. While concerns have been voiced in editorials and opinion pieces or analyses each time a book is banned or someone is sued, the most definitive and encouraging step has come from the Bharatiya Janata Party’s Subramanian Swamy.
The Supreme Court has last week issued notices to the central government on a Swamy petition seeking to set aside these two sections. The plea has said the IPC provisions put unreasonable restrictions on people's right to free speech and expression, guaranteed under Article 19(1)(a) of the Constitution.
Sections 499 and 500 are the 66(A) of the offline world. These sections have been used to harass independent thinkers and muzzle free speech by people who can spend crores in lawyer fees. If Section 66 (A) of the Information Technology Act has been struck down as unconstitutional, there is no reason why these two draconian sections should survive in this information age. When this Street Food was developing, all those unnamed corporations and their promoters had their names. Then, it was decided they'd hide behind common nouns for the time being, till Swamy wins this for us. Swamy, as our prime minister is fond of saying, ‘May the force be with you’, for this once.
