The Bombay High Court has held that the Securities and Exchange Board of India (SEBI) cannot be compelled under the Right to Information Act, 2005, to collect information from a private third party such as the Bombay Stock Exchange (BSE) merely for the purpose of answering an RTI application.
A Division Bench of Justice Manish Pitale and Justice Shreeram V. Shirsat ruled that a public authority is ordinarily required to disclose information that is available with it or under its control when an RTI request is received. The legislation does not require the authority to collect, compile or create information that is not already part of its records.
The High Court consequently quashed a series of orders passed by the Central Information Commission (CIC), which had directed SEBI to obtain information from BSE and furnish it to RTI applicants.
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The dispute arose from RTI applications submitted to SEBI seeking information relating to certain matters involving BSE.
The information sought was not available in SEBI’s existing records and would have required the market regulator to call for it from BSE. The CIC nevertheless held that SEBI was required to obtain the information from the stock exchange and supply it to the applicants.
In its principal order dated May 25, 2009, passed in the matter of Bhoj Raj Sahu, the CIC reasoned that information held by a private body becomes accessible under the RTI Act if a public authority has the legal power to obtain it.
On that basis, the CIC directed SEBI to secure the information from BSE and furnish it within a stipulated period. The same reasoning was subsequently applied in the other matters forming part of the batch.
SEBI and BSE challenged the orders before the Bombay High Court. The impugned directions had remained stayed during the pendency of the writ petitions.
SEBI argued that its status as a public authority and a statutory regulator required it to disclose information already available with it, subject to the exemptions under the RTI Act.
However, the regulator contended that the legislation did not impose an obligation to obtain information from a third party merely because SEBI possessed regulatory powers under its governing statute to call for information from entities such as BSE.
BSE supported this position and challenged the CIC’s interpretation of Section 2(f), which defines “information” to include information relating to a private body that can be accessed by a public authority under any other law in force.
The original RTI applicants, despite being served with notice, did not appear before the High Court to contest the petitions.
Examining Sections 2(f), 2(h), 2(j), 6, 8 and 11 of the RTI Act, the High Court observed that the definition of “information” is undoubtedly broad. Nevertheless, it must be read with the statutory definition of the “right to information” and the other restrictions and safeguards contained in the legislation.
Section 2(j) defines the right to information as the right to access information that is “held by or under the control of” a public authority.
According to the Bench, these provisions demonstrate that the information to be disclosed must ordinarily be held by the public authority when the request is made.
The Court held that the RTI Act does not indicate that a regulatory body, merely because it has statutory powers to seek information from regulated entities, must exercise those powers to collect information for every RTI applicant.
The Bench observed that SEBI’s ability to call for information from third parties while performing its regulatory functions could not automatically be converted into an obligation to procure information solely to satisfy an RTI request.
The High Court relied substantially on the Supreme Court’s ruling in Central Board of Secondary Education v. Aditya Bandopadhyay, in which the Supreme Court clarified that the RTI Act provides access to information that is available and existing.
In that case, the Supreme Court held that where information is not part of the records of a public authority and is not required to be maintained under any law, rule or regulation, the authority cannot be compelled to collect or collate the material and then furnish it to an applicant.
A public authority is similarly not required to draw inferences, make assumptions, generate advice or obtain an opinion specifically for an RTI applicant. References to “opinion” and “advice” in Section 2(f) cover such material only when it already exists in the authority’s records.
The Bombay High Court noted that this principle was subsequently approved by the Constitution Bench of the Supreme Court in Central Public Information Officer, Supreme Court of India v. Subhash Chandra Agarwal.
The Constitution Bench explained that information concerning a private body can fall within Section 2(f) when the public authority is legally entitled to access it. However, any statutory preconditions, limitations or restrictions governing the public authority’s access to such information continue to apply.
The RTI Act’s overriding clause removes restrictions placed on a citizen’s access to information already accessible to a public authority. It does not erase legal restrictions or conditions governing the public authority’s own access to information held by a private body.
The Bench also referred to the Delhi High Court’s decision in Telecom Regulatory Authority of India v. Akshay Kumar Malhotra.
In that case, the Delhi High Court held that a public authority is obligated to disclose only the information it possesses or controls. It is not required to collect information from a private entity or compile or generate information that is neither part of its records nor connected with a statutory obligation to maintain it.
The Bombay High Court found that the same principle applied to SEBI in the present batch of cases.
It also noted that, after the Supreme Court clarified the legal position, the CIC itself had passed subsequent orders declining to direct public authorities such as SEBI to obtain information from third parties like BSE.
Rejecting the CIC’s reasoning, the High Court held that the impugned orders proceeded on the assumption that any information held by a private body automatically becomes accessible to an RTI applicant whenever a public authority has some legal power to obtain it.
The Bench found this interpretation contrary to the law settled by the Supreme Court.
The regulatory power of a public authority to seek information in the performance of its statutory functions cannot, by itself, require that authority to initiate a fresh information-gathering exercise on behalf of an RTI applicant.
Accordingly, the Court held that the CIC could not direct SEBI to obtain information from BSE and then supply it to the applicants.
Allowing all nine writ petitions, the High Court quashed the CIC orders and disposed of all pending applications.
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