July 25, 2021

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The World Stock Markets Tips & Targets, News, Views & Updates

Should public know account balance of rich individuals, banks ask Supreme Court

(This story originally appeared in on Jul 20, 2021)

Are citizen entitled to information about bank balances and borrowings by Tatas, Ambanis and Birlas under the RTI Act, the banks asked on Monday while arguing before the Supreme Court that its judgment opening up confidential banking information through RTI would lay bare future business plans for which industrial houses seek credit lines.

Solicitor general Tushar Mehta and senior advocate Mukul Rohatgi, appearing for two large banks State Bank of India and HDFC Bank respectively, told a bench of Justices S Abdul Nazir and Krishna Murari that banking operations and the financial transactions, including the details of individual accounts, are held in confidence by the banks and that the SC judgment would seriously jeopardise the confidential clauses applicable to the banking operations under various statutes.

On April 29 this year, a bench headed by Justice L N Rao had dismissed applications by major banks, including SBI and HDFC, for recalling the SC’s six-year-old judgment directing the banking regulator RBI to provide information under RTI about functioning of banks under the Act.

Mehta said, “How can the bank breach the trust and faith of the account holder just because a RTI activist desires to know what another person’s bank balance is, or what credit lines he has sought for his business empire for a confidential future venture? No one is against transparency in banking operations. But, why should the banks, mandated by statute to maintain confidentiality, reveal information in breach of account holders’ trust and reveal future business plans to rivals, who could get the information by employing an RTI activist’s services?”

Rohatgi said that “We know how and who would use the RTI to seek information about business rivals. If the banks reveal to which sector loans are being given, then there will be no commercial confidentiality for any future project envisioned by an industrial house. A nine-judge bench of the SC has ruled that individual privacy is a part of right to life. Should account holders in banks not enjoy privacy about their bank accounts?”

But, advocate Prashant Bhushan strongly resisted the fresh move by banks to wriggle out of their obligations to provide information sought under RTI through the RBI. “The Supreme Court has rejected their applications seeking recall of the six year-old judgment directing the RBI to provide information about banking activities. All banks through Indian banking Association were parties to the case. It was a highly publicised matter and yet none of the banks, except ICICI, chose to become party to the hearings. Now they cannot argue that they were not heard.”

The bench said that prima facie Bhushan appears to be right and the matters should be listed before a bench headed by Justice L N Rao, which had rejected the recall applications. However, the bench adjourned further hearing to Thursday as Mehta and Rohatgi argued that the original judgment was passed by a bench headed by the then SC Judge F M I Kalifulla.

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