BSE resists RTI Act scanner Reported by Anshika Misra. Mumbai, DNA Court to hear appeal on Feb 4
The Bombay high court will soon decide whether a citizen can seek trade information from a stock exchange under the Right to Information (
RTI) Act.
The Bombay Stock Exchange (BSE) has challenged a June 2007 order of the Central Information Commission (
CIC), which held that stock exchanges are ‘public authorities’ and hence covered under the
RTI Act.
The
CIC order was passed in response to three appeals filed by persons who had been refused information sought under the
RTI Act by the Jaipur Stock Exchange, the National Stock Exchange (NSE)and the BSE respectively.
The stock exchanges had refused to provide information stating that the
RTI Act could be used to procure information only from a ‘public authority’ and that they were not covered by any such definition under the
RTI Act.
In June 2007, a five-member bench of the
CIC, however, deemed that stock exchanges were ‘public authorities’ as they were subject to writ jurisdiction. (Writs are judicial orders issued to a state or government body.) Normally, writs are not issued to individuals or private bodies, including public limited companies.
Though stock exchanges are registered as public limited companies, the
CIC held that they still discharge an impotrtant public function as they regulate and control the business of sale and purchase of securities. It added that it is only the grant of recognition by the Securities and Exchange Board of India (Sebi) which allows stock exchanges to function and they "remain under the implicit control of the government through Sebi." The
CIC, thus, directed stock exchanges to appoint information officers as stipulated under the
RTI Act.
In July 2007, the BSE moved he high court seeking a quashing of the June, 2007, order as it had not been served a notice for the hearing and added that the
CIC had "erred" in holding it to be a 'public authority'. In an ad-interim order, chief justice Swatanter Kumar and justice DY Chandrachud had stayed the
CIC order pending hearing of the petition. The matter is listed for hearing on February 4. The NSE has also challenged the
CIC order in the Delhi HC.
The BSE has stated that being amenable to writ jurisdiction does not automatically mean that it falls under the narrow definition of 'public authority' under the
RTI Act. It has argued that the grant of recognition as a stock exchange by Sebi is akin to grant of an institutional licence to carry on a particular business or activity.
BSE has added that it is privy to information regarding trading, client identity, arbitration details, investigation reports and surveillance action. Such information largely pertains to third parties and is held in confidence in a fiduciary capacity by the BSE. The information may also be of a sensitive nature and may disrupt investigations and surveillance procedures if made available to the public.
DNA [Daily News & Analysis] Homepage: Mumbai, India, World, breaking news, views, discussions