The Supreme Court on Friday said it will reconsider its 2015 judgment that mandated RBI to disclose inspection reports of banks as well as details of wilful defaulters. More than 15 PSU and private banks had raised privacy and confidentiality issues while seeking exemption from disclosing any information related to their customers, trade secrets, risk ratings or any unpublished price sensitive information from the Right to Information (RTI) Act.
A Bench led by Justice BR Gavai, without expressing any final opinion, said that “prima facie, we find that the judgment in the case of Jayantilal N Mistry (supra) did not take into consideration the aspect of balancing the right to information and the right to privacy”.
Noting that the right to privacy was declared a fundamental right by a nine-judge bench in KS Puttaswamy case (Aadhar judgment) subsequently in 2017, the apex court rejected the preliminary objections raised against the banks’ pleas, terming them “not sustainable”.
The top court said the banks were not parties to the 2015 judgment and their applications for recall of the decision was rejected on April 28, 2021. However, this court did not foreclose their right to pursue other remedies available to them in law.
Lenders including SBI, PNB and HDFC Bank had vehemently opposed any disclosure of their “highly confidential and sensitive” inspection and risk assessment reports, saying this would be an invasion of right to privacy of their lenders and customers, shareholders and employees.
The banks had challenged the action of the RBI, which issued directions to banks to disclose certain confidential and sensitive information. They said that they being privy to sensitive information like personal details of its account holders, prospective loans and other financial transactions are required to keep such info confidential and maintain privacy as directed by the SC in the Aadhar judgment, which recognises the fact that right to privacy is a sacrosanct facet of fundamental rights. Banks may require the consent of the individual account holders before any such disclosure, they stated.
Public disclosure of information pertaining to commercial confidence, business strategies, internal system, risk management, gas, etc would not serve any larger public interest, but would adversely affect the competitive position of banks in a highly competitive private banking sector in our country, banks had told the top court.