Business
Standard: New Delhi: Saturday, 06 December 2014.
The Central
Information Commission (CIC) has ruled in favour of Reliance Industries Ltd
(RIL) in an appeal seeking details about an investigation by the Securities and
Exchange Board of India (Sebi) into the sale of Reliance Petroleum shares in
2007.
In orders on
two different appeals, its full bench decided (the order was issued on November
28) that Sebi need not disclose the details sought by a citizen, an Arun
Agrawal, under the Right to Information Act (RTI).
It decided a
sufficient case had not been made that such a disclosure would serve the
“public interest”. And, that disclosure of such information would defeat the
purposes for which these had been offered protection in the first place.
NOT
ENTIRELY PRIVATE
· September
2011: RTI application filed by Arun Agrawal to Sebi, seeking details about RIL
matter
· October
2011: CPIO refuses information, saying quasi-judicial proceedings were
underway; Agrawal goes for appeal
· November
2011: Appeals rejected
· November
2012: CIC tells Sebi to disclose details; RIL gets stay from Delhi High Court;
Sebi moves Bombay High Court
· January
2013: Names of some RIL-related entities disclosed, detailing applicants whose
consent orders were rejected
· January
31, 2013: Delhi HC directs CIC to give RIL a hearing
· April
2014: CIC issues notices to 12 entities
· July
2014: Hearing by CIC
· November
28, 2014: Order ruling that Sebi need not disclose details sought by Agrawal
Agrawal says
he will appeal against these verdicts. His petition had initially been rejected
by Sebi, towards the end of 2011. Agrawal appealed and, a year after, the then
central information commissioner, Satyanand Mishra, had said the information
should be given, since, “If as a regulator, Sebi took cognizance of allegations
of any breach of law, rules or regulations by one or more entities for unlawful
private gain, the information generated in the process of its investigation
needs to be disclosed in the public domain. Such disclosure would keep the
general public informed and educated about the risks they may confront in
making investments in the market. It would also prevent many entities from
adopting shortcuts to make profit through unlawful means. The argument that at
the end of the quasi-judicial proceedings the charged entities may be found
innocent cannot be an argument against disclosing the information.”
RIL got a
stay from the high court here, which said the arguments on the mater should be
heard afresh by the appellate body. The latest verdict, overturning the earlier
decision, is the outcome.
The first RIL
appeal was on a petition seeking several details, including the inspection
report in respect of the entities involved with RIL in the (alleged ) short
sale of shares of Reliance Petroleum in November 2007, various applications of
consent order/terms offered by RIL and the entities involved or charged under
the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Regulations,
file notings and the entire file of this case.
In the second
appeal, the appellant sought details of “the name and addresses of the entities
(name of individuals, partners, directors and major shareholders, if companies)
involved in the short sale of shares of Reliance Petroleum in November 2007 and
name of the brokers through whom the short sales deal was routed.” Of these,
the names of 12 entities were revealed in a January 2013 order. Other details
of these 12 and details of the brokers are still not public.
The
commission's latest order said: "The process of probe against RIL
initiated by Sebi is still continuing. So, the disclosure of the requested
information at this stage would impede the said process and defeat the purpose
of the protection granted to such information. No concrete and tangible case of
public interest has been made out by the appellant...we also do not find any
legal flaw in the Sebi stand that the requested information should not be
disclosed at this stage.” The commission also saw merit in the arguments put by
Amit Sibal, counsel for RIL, who said the allegation that there was a
conspiracy between RIL and the 12 entities was baseless. He had argued that
disclosure of the desired information would affect the efficient operation of
Sebi and the confidentiality of sensitive information would not be preserved.
An email to the RIL spokesperson did not elicit any response.
And, that
“the right to negotiation and settle in confidence is fundamental…If the
information is disclosed, it will strike down the policy of Sebi to negotiate.”
Agrawal said:
“It is surprising that the same commission which had earlier found that the
information should be divulged in the public interest now finds that the
information is not in the public interest. There should be some objective
parameters of public interest under the RTI Act. Public interest is suffering
on account of not appointing a Chief Information Commissioner.”
The latter
post has been vacant for three and a half months. On earlier occasions, the
seniormost commissioner was appointed CIC and the post was never left vacant.
While RIL had
got a stay on the first CIC order in the Delhi HC, Sebi had challenged the
order in the Bombay HC. On RIL’s request, the latter had agreed to postpone the
hearing till the Delhi HC decision. However, in an order detailing entities
whose consent orders were rejected in January 2013, Sebi on its own put out the
names of 12 entities that assisted RIL in the 2007 transaction. On January 31,
2013, the Delhi HC set aside the CIC order on the grounds that the CIC did not
give RIL an opportunity to present its case before passing the impugned order.
The court remanded the case back to the commission, directing it to issue
notices to RIL.
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