Supreme Court Dismisses Recall Applications in RBI Information Disclosure Case: Reserve Bank of India vs. Jayantilal N. Mistry & Anr. (28 April 2021)

Date of the Judgment: 28 April 2021
Citation: M.A. No.2342 of 2019 in Transferred Case (Civil) No.91 of 2015
Judges: L. Nageswara Rao J. and Vineet Saran J.
Can a judgment of the Supreme Court be recalled if affected parties were not heard? The Supreme Court of India recently addressed this question when several banks sought to recall a 2015 judgment that mandated the Reserve Bank of India (RBI) to disclose certain information under the Right to Information Act, 2005. The banks argued they were not heard in the original case and that the judgment violated their right to privacy. The Supreme Court dismissed these recall applications, clarifying the difference between a recall and a review.

Case Background

The case originated from a dispute over the Reserve Bank of India’s (RBI) refusal to disclose certain information requested by respondents, citing exemptions under the Right to Information Act, 2005 (RTI Act). The RBI had claimed that the information was protected due to its fiduciary relationship with banks. The High Courts were transferred to the Supreme Court on request of the RBI. On December 16, 2015, the Supreme Court ruled in Reserve Bank of India v. Jayantilal N. Mistry that the RBI did not have a fiduciary relationship with banks and was obligated to disclose the requested information in the public interest. This judgment directed the RBI to act with transparency and comply with the RTI Act.

Following the 2015 judgment, the RBI issued a disclosure policy on November 30, 2016, which was found to be in violation of the Court’s directions. A subsequent disclosure policy was uploaded on April 12, 2019, and later deleted from the RBI website. The Supreme Court, on April 26, 2019, in Girish Mittal v. Parvati V. Sundaram & Anr., directed the RBI to withdraw exemptions in its disclosure policy that were contrary to the Court’s directions, warning of serious consequences for further violations.

Subsequently, HDFC Bank Limited and other banks filed miscellaneous applications seeking to be impleaded in the case and to recall the 2015 judgment. These banks argued that the judgment had far-reaching consequences and they were not heard before the judgment was passed. They also argued that the judgment violated their right to privacy. The Supreme Court had directed the RBI not to release inspection reports, risk assessment reports, and annual financial inspection reports of the banks, including the State Bank of India on December 18, 2019.

Timeline

Course of Proceedings

The initial proceedings involved writ petitions filed in various High Courts, which were then transferred to the Supreme Court at the request of the RBI. The Supreme Court’s judgment on December 16, 2015, in Reserve Bank of India v. Jayantilal N. Mistry, directed the RBI to disclose the requested information. Following this, contempt petitions were filed alleging willful disobedience of the Court’s directions. The Court found the RBI’s disclosure policies to be in violation of its judgment. Subsequently, miscellaneous applications were filed by various banks seeking recall of the 2015 judgment.

Legal Framework

The case primarily involves the interpretation and application of the Right to Information Act, 2005 (RTI Act), specifically:

• Section 8(1)(a) of the RTI Act: This section exempts from disclosure 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.
• Section 8(1)(d) of the RTI Act: This section exempts from disclosure information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information.
• Section 8(1)(e) of the RTI Act: This section exempts from disclosure information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information.

The Supreme Court also considered the principles of natural justice, the right to privacy under Article 21 of the Constitution of India, and the distinction between a review and a recall of a judgment.

Arguments

Applicants (Banks):

• The banks argued that the 2015 judgment in Jayantilal N. Mistry (supra) had far-reaching consequences for them, and they were not given an opportunity to be heard. They contended that this violated the principles of natural justice.
• They argued that the judgment failed to consider the right to privacy, which is an intrinsic part of the right to life and personal liberty under Article 21 of the Constitution of India, as established in Justice K.S. Puttaswamy (Retd.) & Anr. v. Union of India & Ors..
• The banks submitted that the judgment was per incuriam as it did not consider certain judgments of the Supreme Court.
• They distinguished between a review and a recall, stating that a recall is necessary when a judgment is passed without jurisdiction or without hearing an affected party, while a review is for errors on the face of the record.

Respondents:

• The respondents argued that the applications for recall were merely attempts to avoid filing review petitions, which are decided by circulation, as held in Delhi Administration v. Gurdip Singh Uban & Ors.
• They contended that the judgment in Jayantilal N. Mistry (supra) was delivered after hearing the RBI and ICICI Bank, and all banks were aware of the proceedings but did not seek impleadment.
• The respondents asserted that the contempt petition was against the RBI, and the banks could not have been made parties to it.
• They argued that it is in the public interest to disclose the information directed by the RBI under the RTI Act.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the miscellaneous applications filed by the banks for recall of the judgment in Jayantilal N. Mistry (supra) are maintainable.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

Judgment

What weighed in the mind of the Court?

The Supreme Court’s decision to dismiss the recall applications was primarily influenced by the following considerations:

• Procedural Propriety: The Court emphasized that the banks were aware of the proceedings in Jayantilal N. Mistry (supra) and had the opportunity to seek impleadment but failed to do so.
• Distinction between Recall and Review: The Court reiterated that recall applications are not meant to be a substitute for review petitions and are only maintainable in cases of lack of jurisdiction or violation of the principles of natural justice, which were not found in this case.
• Substance over Form: The Court focused on the substance of the applications, noting that they were essentially seeking a review of the judgment, regardless of the nomenclature used.
• Finality of Judgments: The Court stressed the importance of finality in judgments and the need to prevent the reopening of concluded cases through frivolous applications.

The Supreme Court reasoned that the applications filed by the banks were essentially seeking a review of the 2015 judgment in Jayantilal N. Mistry (supra). The Court emphasized that recall applications are not a substitute for review petitions and are only maintainable in specific circumstances, such as lack of jurisdiction or violation of natural justice. The Court stated, “The nomenclature given to an application is of absolutely no consequence – what is of importance is the substance of the application.” The Court also highlighted that the banks were aware of the proceedings in the original case and did not take steps to get themselves impleaded, stating, “No effort was made by any of the applicants in the miscellaneous applications to get themselves impleaded when the transferred cases were being heard by this Court.” The Court also relied on its previous judgment in Delhi Administration v. Gurdip Singh Uban & Ors. to reiterate that recall applications should not be entertained except in extraordinary circumstances, stating, “In Delhi Administration v. Gurdip Singh Uban & Ors. (supra), this Court made it clear that applications filed for clarification, modification or recall are often only a camouflage for review petitions.”

Key Takeaways

• Recall applications are not a substitute for review petitions.
• Affected parties must seek impleadment in ongoing proceedings.
• The substance of an application is more important than its nomenclature.
• Finality of judgments is crucial for the judicial system.
• The Court did not address the correctness of the judgment of Jayantilal N. Mistry (supra) and the dismissal of the applications shall not prevent the applicants to pursue other remedies available to them in law.

Directions

The Supreme Court dismissed all the miscellaneous applications. The Court clarified that the dismissal of these applications shall not prevent the applicants from pursuing other remedies available to them in law.

Development of Law

The judgment reinforces the distinction between recall and review applications, emphasizing that recall is not a substitute for review. The ratio decidendi of the case is that recall applications are not maintainable if the affected party was aware of the proceedings and did not seek impleadment. The Court also reiterated the importance of finality of judgments and that the substance of the application is more important than the nomenclature.

Conclusion

In conclusion, the Supreme Court dismissed the miscellaneous applications filed by various banks seeking recall of the 2015 judgment in Reserve Bank of India v. Jayantilal N. Mistry. The Court held that the applications were essentially for review and not recall, emphasizing the importance of procedural propriety, substance over form, and the finality of judgments. The Court clarified that the dismissal of these applications shall not prevent the applicants to pursue other remedies available to them in law.