Moneycontrol: New Delhi: Saturday, 04 July 2026.
The judgment marks the beginning of a legal debate on whether entities termed as critical public functions in the securities market, despite being private companies, should be treated as public authorities for the RTI Act.
A recent Delhi High Court
ruling holding that the National Stock Exchange (NSE) is a ‘public authority’
under the Right to Information (RTI) Act could have implications far beyond the
country's largest stock exchange, with legal experts saying the reasoning may
also extend to other stock exchanges, clearing corporations and depositories
operating in India's securities market. Not only the securities market but all
entities under other regulators may come under the ambit of RTI.
The ruling has sparked discussion within legal and market circles over whether the same logic could apply to other market infrastructure institutions (MIIs), including stock exchanges, clearing corporations and depositories, all of which operate under a regulatory framework that requires recognition or registration by SEBI and are subject to continuous oversight.
Former member of SEBI's Data Advisory Committee, Suhas Tuljapurkar, said the judgment could have ramifications well beyond the securities market if its underlying reasoning is applied more broadly. "If the logic that every regulated entity should come under the RTI Act merely because it is subject to regulatory oversight is accepted, then the implications could extend well beyond the securities market," Tuljapurkar said.
He said the Delhi High Court's ruling relied heavily on the Supreme Court's decision in Delhi Stock Exchange Vs KC Sharma, even though the functioning of stock exchanges has undergone a fundamental transformation since the dispute arose in 1992. According to him, applying the same principle across sectors could potentially bring entities regulated by the RBI, IRDAI, CERC, PNGRB, and RERA within the RTI framework. Within the securities market, he said, the impact could extend to stock exchanges, depositories, clearing corporations, registrars and transfer agents (RTAs), mutual funds, alternative investment funds (AIFs) and proxy advisory firms.
Tuljapurkar also cautioned that while transparency is important, it should not come at the cost of exposing sensitive market information that could undermine market integrity.
Tuljapurkar summed up, ” Let us leave the transparency in stock exchanges to their governing boards and SEBI; otherwise, everyone’s shareholding can soon be found on the dark web. "
Neeha Nagpal, Founding and Managing Partner at N & Company Legal, said the judgment's reasoning is not confined to NSE alone. "The ruling unmistakably opens this door, and it would be naïve to assume it closes at NSE's threshold. The reasoning the Delhi High Court applied is not specific to NSE at all." Nagpal said.
She said the court's reasoning rests on two pillars: first, that recognition under Section 4(3) of the Securities Contracts (Regulation) Act is indispensable for a stock exchange to exist and operate; and second, that SEBI exercises deep and pervasive control over such entities on behalf of the Central Government.
According to Nagpal, the same structural framework applies to BSE, depositories such as CDSL and NSDL, and clearing corporations. Nagpal added that the case for depositories may be even stronger because they hold the country's securities in dematerialised form while operating under extensive SEBI oversight. Given the quasi-public functions they perform for millions of investors, she said, extending RTI obligations to such entities would be a natural consequence of the court's reasoning.
Stock exchanges have historically maintained that they are private companies and, therefore, fall outside the ambit of the RTI Act. However, the Delhi High Court took a different view, observing that an exchange cannot be established or function without recognition from the Securities and Exchange Board of India (SEBI) under the Securities Contracts (Regulation) Act (SCRA). The court also noted the extensive regulatory and supervisory control exercised by SEBI and the Central Government over stock exchanges.
Based on these factors, the court held that NSE performs public functions and can be treated as a public authority under the RTI Act.
Legal experts say the principles laid down by the court could be relied upon in future litigation involving similar entities, particularly where they discharge statutory functions that are integral to the securities market.
If upheld by higher courts, investors, listed companies and other stakeholders may be able to seek information relating to regulatory processes, governance and decision-making, subject to the exemptions available under the RTI Act for confidential, commercially sensitive or market-sensitive information.
Experts say that any expansion of the RTI framework to market infrastructure institutions would need to balance between transparency and the need to protect confidential trading, surveillance, and risk-management information, disclosure of which could undermine market integrity.
The judgment marks the beginning of a legal debate on whether entities termed as critical public functions in the securities market, despite being private companies, should be treated as public authorities for the RTI Act.
The ruling has sparked discussion within legal and market circles over whether the same logic could apply to other market infrastructure institutions (MIIs), including stock exchanges, clearing corporations and depositories, all of which operate under a regulatory framework that requires recognition or registration by SEBI and are subject to continuous oversight.
Former member of SEBI's Data Advisory Committee, Suhas Tuljapurkar, said the judgment could have ramifications well beyond the securities market if its underlying reasoning is applied more broadly. "If the logic that every regulated entity should come under the RTI Act merely because it is subject to regulatory oversight is accepted, then the implications could extend well beyond the securities market," Tuljapurkar said.
He said the Delhi High Court's ruling relied heavily on the Supreme Court's decision in Delhi Stock Exchange Vs KC Sharma, even though the functioning of stock exchanges has undergone a fundamental transformation since the dispute arose in 1992. According to him, applying the same principle across sectors could potentially bring entities regulated by the RBI, IRDAI, CERC, PNGRB, and RERA within the RTI framework. Within the securities market, he said, the impact could extend to stock exchanges, depositories, clearing corporations, registrars and transfer agents (RTAs), mutual funds, alternative investment funds (AIFs) and proxy advisory firms.
Tuljapurkar also cautioned that while transparency is important, it should not come at the cost of exposing sensitive market information that could undermine market integrity.
Tuljapurkar summed up, ” Let us leave the transparency in stock exchanges to their governing boards and SEBI; otherwise, everyone’s shareholding can soon be found on the dark web. "
Neeha Nagpal, Founding and Managing Partner at N & Company Legal, said the judgment's reasoning is not confined to NSE alone. "The ruling unmistakably opens this door, and it would be naïve to assume it closes at NSE's threshold. The reasoning the Delhi High Court applied is not specific to NSE at all." Nagpal said.
She said the court's reasoning rests on two pillars: first, that recognition under Section 4(3) of the Securities Contracts (Regulation) Act is indispensable for a stock exchange to exist and operate; and second, that SEBI exercises deep and pervasive control over such entities on behalf of the Central Government.
According to Nagpal, the same structural framework applies to BSE, depositories such as CDSL and NSDL, and clearing corporations. Nagpal added that the case for depositories may be even stronger because they hold the country's securities in dematerialised form while operating under extensive SEBI oversight. Given the quasi-public functions they perform for millions of investors, she said, extending RTI obligations to such entities would be a natural consequence of the court's reasoning.
Stock exchanges have historically maintained that they are private companies and, therefore, fall outside the ambit of the RTI Act. However, the Delhi High Court took a different view, observing that an exchange cannot be established or function without recognition from the Securities and Exchange Board of India (SEBI) under the Securities Contracts (Regulation) Act (SCRA). The court also noted the extensive regulatory and supervisory control exercised by SEBI and the Central Government over stock exchanges.
Based on these factors, the court held that NSE performs public functions and can be treated as a public authority under the RTI Act.
Legal experts say the principles laid down by the court could be relied upon in future litigation involving similar entities, particularly where they discharge statutory functions that are integral to the securities market.
If upheld by higher courts, investors, listed companies and other stakeholders may be able to seek information relating to regulatory processes, governance and decision-making, subject to the exemptions available under the RTI Act for confidential, commercially sensitive or market-sensitive information.
Experts say that any expansion of the RTI framework to market infrastructure institutions would need to balance between transparency and the need to protect confidential trading, surveillance, and risk-management information, disclosure of which could undermine market integrity.
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