Supreme Court allows Banks’ challenge to RBI’s disclosure of information under RTI Act: HDFC Bank Ltd. vs. Union of India (2022)

Date of the Judgment: 30 September 2022
Citation: 2022 INSC 838
Judges: B.R. Gavai, J., C.T. Ravikumar, J.
Can a previous judgment of the Supreme Court be challenged through a writ petition? The Supreme Court of India recently addressed this critical question in a batch of writ petitions filed by various banks, including private banks, challenging the Reserve Bank of India’s (RBI) directives to disclose confidential information under the Right to Information Act, 2005. The banks argued that this information is exempt under Section 8 of the RTI Act and that the directions infringe upon the privacy of their customers. This judgment examines the maintainability of these petitions in light of prior Supreme Court rulings on the matter.

Case Background

Several banks, including HDFC Bank, filed writ petitions challenging the RBI’s directives to disclose confidential information under the RTI Act. These directives were based on previous Supreme Court judgments that mandated the disclosure of such information. The banks contended that the information sought was exempt under Section 8 of the RTI Act and that the disclosure would violate the privacy of their customers. The banks sought relief from these directives, arguing that they were not parties to the previous judgments and that the court had not considered the right to privacy in those cases.

Timeline:

Course of Proceedings

The writ petitions were filed directly in the Supreme Court because the banks argued that the RBI’s directives were based on the Supreme Court’s previous judgments. The banks contended that they could not approach the High Court for relief because the directives were a direct consequence of the Supreme Court’s decisions. The banks argued that the only remedy available to them was to approach the Supreme Court directly via writ petitions under Article 32 of the Constitution of India. The applicant, Girish Mittal, filed Interlocutory Applications seeking dismissal of the present writ petitions, contending that the present writ petitions are challenging the final judgment of the Supreme Court in the case of Reserve Bank of India vs. Jayantilal N. Mistry.

Legal Framework

The case revolves around the interpretation of several key legal provisions:

• Right to Information Act, 2005: The banks argued that the information sought by the RBI was exempt under Section 8 of the Right to Information Act, 2005.
• Section 11 of the Right to Information Act, 2005: This section mandates that when information relating to a third party is sought, a written notice must be given to such third party, and their submissions must be considered before deciding on disclosure.
• Section 35 of the Banking Regulation Act, 1949: This section deals with the inspection of banks by the RBI. Sub-section (5) of this section specifies the procedure for publishing inspection reports.
• Section 45NB of the Reserve Bank of India Act, 1934: This section emphasizes the confidentiality of certain information related to non-banking companies. Sub-section (4) of this section states that no court or authority can compel the RBI to produce or give inspection of any statement or material obtained by the Bank under this chapter.
• Article 32 of the Constitution of India: This article grants the right to individuals to move the Supreme Court for the enforcement of their fundamental rights.
• Article 137 of the Constitution of India: This article confers the power on the Supreme Court to review its own judgments.

The banks also argued that the right to privacy, recognized as a fundamental right by the Supreme Court in K.S. Puttaswamy and another vs. Union of India and others, was being violated by the RBI’s directives.

Arguments

The arguments presented before the Supreme Court can be categorized as follows:

Arguments of the Applicant (Girish Mittal)

• The issue raised in the present writ petitions has already been settled by the Supreme Court in Reserve Bank of India vs. Jayantilal N. Mistry.
• The Supreme Court in Girish Mittal vs. Parvati V. Sundaram and another held that the RBI was duty-bound to furnish all information relating to inspection reports and other materials.
• A judicial decision cannot be corrected by the Supreme Court in exercise of its jurisdiction under Article 32 of the Constitution of India, relying on Naresh Shridhar Mirajkar and others vs. State of Maharashtra and Anr.
• Judicial proceedings in the Supreme Court are not subject to its writ jurisdiction, relying on A.R. Antulay vs. R.S. Nayak and another.
• The validity of an order passed by the Supreme Court itself cannot be subject to its writ jurisdiction, relying on Anil Kumar Barat vs. Secretary, Indian Tea Association and others.
• The judgment in Jayantilal N. Mistry was delivered after considering rival submissions, and therefore, cannot be reopened.
• The Supreme Court specifically rejected the prayer filed by the Banks for recall of the judgment in Jayantilal N. Mistry.

Arguments of the Writ Petitioners/Banks

• The order rejecting the recall application clarified that the dismissal shall not prevent the applicant-Banks from pursuing other remedies available to them in law.
• Section 11 of the RTI Act requires a notice to be given to the third party when information relating to them is sought, which was not considered in Jayantilal N. Mistry, relying on Chief Information Commissioner vs. High Court of Gujarat and another.
• The right to privacy is a fundamental right, as recognized by the Supreme Court in Supreme Court Advocates-on-Record Association and another vs. Union of India and K.S. Puttaswamy and another vs. Union of India and others.
• No man should suffer because of the mistake of the Court, and the rules of procedure are handmaidens of justice, not its mistress, relying on A.R. Antulay and the maxim “ex debito justitiae”.
• The present petition is tenable, relying on Sanjay Singh and another vs. U.P. Public Service Commission, Allahabad and another.
• Private banks are not a public authority as defined under the RTI Act, relying on Thalappalam Service Cooperative Bank Limited and others vs. State of Kerala and others.
• RBI’s Inspection Reports are so confidential that they cannot even be provided to the Directors individually, relying on a communication issued by the RBI dated 14th March 1998.
• The earlier policy of the RBI was in tune with the provisions of Section 8 of the RTI Act, the provisions of the Reserve Bank of India Act, 1934 and the Banking Regulation Act, 1949.
• The Court will have to strike a balance between public interest and private interest, relying on Bihar Public Service Commission vs. Saiyed Hussain Abbas Rizwi and another.
• Personal information cannot be directed to be disclosed unless outweighing public interest demands it, relying on Girish Ramchandra Deshpande vs. Central Information Commissioner and others.
• HDFC Bank, Kotak Bank, and Bandhan Bank were not parties in the case of Jayantilal N. Mistry.
• Sub-Section (5) of Section 35 of the Banking Regulation Act, 1949 provides a specific procedure for publishing inspection reports, which was not noticed in Jayantilal N. Mistry.
• The provisions of the Credit Information Companies (Regulation) Act, 2005 were not considered in Jayantilal N. Mistry.
• Section 45NB of the RBI Act emphasizes the confidentiality of certain information with regard to non-banking companies, which was not noticed in Jayantilal N. Mistry.
• The RBI’s directions compel the petitioners to disclose information exempted under the RBI Act and other special enactments.
• The judgment in Jayantilal N. Mistry does not notice the judgment in Supreme Court Advocates-on-Record Association and another.
• The law laid down in Jayantilal N. Mistry is no more a good law, requiring reconsideration by a larger Bench, in light of the judgment in K.S. Puttaswamy and another, which recognized the right to privacy as a fundamental right.

The innovativeness of the arguments by the banks lies in their emphasis on the right to privacy as a fundamental right, which was recognized by the Supreme Court after the Jayantilal N. Mistry judgment. They also highlighted the specific provisions of various acts that were not considered in the earlier judgment.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was whether the writ petitions filed by the banks were maintainable, considering the previous judgments of the Supreme Court on the same matter.

Treatment of the Issue by the Court:

Authorities

The Supreme Court considered the following authorities:

• Reserve Bank of India vs. Jayantilal N. Mistry, (2016) 3 SCC 525, Supreme Court of India: This case was the basis of the RBI’s directives to disclose information.
• Girish Mittal vs. Parvati V. Sundaram and another, (2019) 20 SCC 747, Supreme Court of India: This case held that the RBI was duty-bound to furnish all information relating to inspection reports.
• Naresh Shridhar Mirajkar and others vs. State of Maharashtra and Anr., (1966) 3 SCR 744, Supreme Court of India: This case was cited to argue that a judicial decision cannot be corrected by the Supreme Court in its writ jurisdiction.
• A.R. Antulay vs. R.S. Nayak and another, (1988) 2 SCC 602, Supreme Court of India: This case was cited to argue that judicial proceedings in the Supreme Court are not subject to its writ jurisdiction and that no man should suffer due to a mistake of the court.
• Anil Kumar Barat vs. Secretary, Indian Tea Association and others, (2001) 5 SCC 42, Supreme Court of India: This case was cited to argue that the validity of an order passed by the Supreme Court cannot be subject to its writ jurisdiction.
• Khoday Distilleries Ltd. and another vs. Registrar General, Supreme Court of India, (1996) 3 SCC 114, Supreme Court of India: This case was cited regarding the challenge to the correctness of a decision on merits after the appeal and review were dismissed.
• Mohd. Aslam vs. Union of India and others, (1996) 2 SCC 749, Supreme Court of India: This case was cited regarding the maintainability of a petition under Article 32 to challenge a decision on merits.
• Union of India and others vs. Major S.P. Sharma and others, (2014) 6 SCC 351, Supreme Court of India: This case was cited regarding the reopening of a question of fact that has reached finality.
• Rupa Ashok Hurra vs. Ashok Hurra and another, (2002) 4 SCC 388, Supreme Court of India: This case was cited regarding the power of the Supreme Court to reconsider its judgments to prevent abuse of process and cure gross miscarriage of justice.
• Chief Information Commissioner vs. High Court of Gujarat and another, (2020) 4 SCC 702, Supreme Court of India: This case was cited regarding the requirement to give notice to a third party under Section 11 of the RTI Act.
• Supreme Court Advocates-on-Record Association and another vs. Union of India, (2016) 5 SCC 1, Supreme Court of India: This case recognized the right to privacy as an implicit fundamental right.
• K.S. Puttaswamy and another vs. Union of India and others, (2017) 10 SCC 1, Supreme Court of India: This case explicitly and categorically recognized the right to privacy as a fundamental right.
• Sanjay Singh and another vs. U.P. Public Service Commission, Allahabad and another, (2007) 3 SCC 720, Supreme Court of India: This case was cited to argue that the present petition would be tenable.
• Thalappalam Service Cooperative Bank Limited and others vs. State of Kerala and others, (2013) 16 SCC 82, Supreme Court of India: This case was cited to argue that private banks are not a public authority under the RTI Act.
• Bihar Public Service Commission vs. Saiyed Hussain Abbas Rizwi and another, (2012) 13 SCC 61, Supreme Court of India: This case was cited to argue that the Court will have to strike a balance between public interest and private interest.
• Girish Ramchandra Deshpande vs. Central Information Commissioner and others, (2013) 1 SCC 212, Supreme Court of India: This case was cited to argue that personal information cannot be directed to be disclosed unless outweighing public interest demands it.
• Manohar Joshi vs. Nitin Bhaurao Patil and another, (1996) 1 SCC 169, Supreme Court of India: This case was considered in the context of whether a judgment was in conflict with a Constitution Bench judgment.
• S.R. Bommai and others vs. Union of India and others, (1994) 3 SCC 1, Supreme Court of India: This case was considered in the context of whether a judgment was in conflict with a Constitution Bench judgment.

Judgment

In conclusion, the Supreme Court allowed the writ petitions, holding that the preliminary objection regarding maintainability was not sustainable. The Court acknowledged that the banks were not parties to the earlier judgment in Jayantilal N. Mistry and that the right to privacy was not considered in that judgment. The Court emphasized the principle of “ex debito justitiae” and the need to rectify errors to prevent injustice. The Court did not express any final opinion on the other submissions, including whether private banks are public authorities or whether the RBI’s directions compel disclosure of exempted information. The Court held that the matter required a detailed consideration and would be decided on its merits.

Ratio Decidendi

The ratio decidendi of this judgment is that the Supreme Court can entertain writ petitions under Article 32 of the Constitution of India to correct its own judgments when fundamental rights, such as the right to privacy, were not considered in the previous judgments. The Court emphasized that the principle of “ex debito justitiae” allows the Court to rectify errors to prevent injustice, even if it means revisiting its earlier decisions.

Obiter Dicta

The Court made several obiter dicta in this case:

• The Court noted that the right to privacy, recognized as a fundamental right in K.S. Puttaswamy, was not considered in Jayantilal N. Mistry.
• The Court acknowledged that Section 11 of the RTI Act, which requires notice to be given to a third party, was not considered in Jayantilal N. Mistry.
• The Court acknowledged that Section 35(5) of the Banking Regulation Act, the Credit Information Companies Act, and Section 45NB of the RBI Act were not considered in Jayantilal N. Mistry.
• The Court did not express any final opinion on whether private banks are public authorities under the RTI Act.
• The Court did not express any final opinion on whether the RBI’s directions compel disclosure of exempted information.

Flowchart of the Case

Conclusion

The Supreme Court’s judgment in HDFC Bank Ltd. vs. Union of India is significant because it acknowledges the conflict between the Right to Information and the Right to Privacy. By allowing the banks to challenge the RBI’s directives, the Court has recognized that previous judgments may need to be revisited when they fail to consider fundamental rights. This case highlights the importance of balancing public interest with individual privacy and the need for the judiciary to rectify its own errors to prevent injustice. The case will now be heard on its merits, where the Court will delve deeper into the specific provisions of the RTI Act, the Banking Regulation Act, and the Reserve Bank of India Act, along with the fundamental right to privacy.