CIC decisions — Scheduled Banks — Right to Information (RTI) Notes

CIC decisions — Scheduled Banks

When a citizen asks who is defaulting on public-sector-bank loans, the reply used to be that the information was held in “fiduciary confidence” for the borrower. In 2016 the Supreme Court demolished that defence in one of the most quoted RTI judgments of all — the regulator, it held, is a trustee for the public, not a shield for the bank.

The fiduciary defence, defeated

A. Banks and the RBI as public authorities

Nationalised and scheduled banks, and the Reserve Bank of India, are public authorities under s. 2(h). The RBI is a statutory regulator discharging a public function; it cannot claim to be a private confidant of the banks it regulates.

B. The rejection of the s. 8(1)(e) fiduciary claim

Section 8(1)(e) exempts information available to a person in a fiduciary relationship — but a fiduciary acts for the beneficiary’s benefit. The RBI’s inspection reports, defaulter lists and action taken against banks are held to protect the public and the economy, not the banks. So the fiduciary exemption does not apply.

Section 8(1)(e), Right to Information Act, 2005: there shall be no obligation to give any citizen “information available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information”.

In Simple Terms: A fiduciary holds information for someone. The RBI does not hold its inspection data for the banks; it holds it for the public. So s. 8(1)(e) never fits — and even if it did, the larger public interest in a clean banking system would override it.

Reserve Bank of India v. Jayantilal N. Mistry (2016) — the RBI cannot withhold bank inspection reports, defaulter lists and related information under s. 8(1)(e); there is no fiduciary relationship with the banks, and disclosure serves a paramount public interest in transparency of the financial system.

🔑 KEY POINT — a regulator is a public trustee, not a private fiduciary

🔑 RBI v. Jayantilal Mistry (2016) is the anchor case for this topic: a regulator holds information for the public it protects, not for the entities it regulates, so the s. 8(1)(e) fiduciary shield collapses. Individual customers’ account details remain personal under s. 8(1)(j) — but wilful defaulters, inspection findings and regulatory action are disclosable.

🧩 WORKED EXAMPLE — the wilful-defaulter list

Facts. A journalist asks the RBI for its list of large wilful defaulters of public-sector-bank loans and the inspection reports on a bank. The RBI refuses under s. 8(1)(e), claiming a fiduciary duty to the banks.

Rule. The RBI is a public authority; s. 8(1)(e) applies only to genuine fiduciary information and yields to larger public interest; RBI v. Jayantilal Mistry (2016) rejects the fiduciary claim for regulatory data.

Apply. The RBI’s relationship with the banks is regulatory, not fiduciary; it acts for the public. The defaulter list and inspection findings concern the health of public money and carry an overwhelming public interest. Individual small-borrower account data would be severed as personal (s. 8(1)(j)), but the wilful-defaulter information is disclosable.

Conclusion. The refusal fails; the RBI must disclose the defaulter list and inspection reports, redacting only genuinely personal customer data.

flowchart TD
    A["SCHEDULED BANKS & THE RBI"]
    A --> B["Public authorities under s. 2(h)"]
    A --> C["Bank defence: s. 8(1)(e)<br/>'fiduciary relationship'"]
    C --> D["REJECTED — RBI v. Jayantilal Mistry (2016):<br/>regulator holds data FOR THE PUBLIC,<br/>not for the banks"]
    D --> E["Disclose: inspection reports,<br/>wilful-defaulter lists, action taken"]
    D --> F["Withhold: individual customer<br/>account data (s. 8(1)(j))"]
    classDef box fill:#e8f0fe,stroke:#333,color:#111;
    class A,B,C,D,E,F box;

Case Laws

Reserve Bank of India v. Jayantilal N. Mistry (2016) — the leading case: no fiduciary shield for regulatory information; disclosure serves a paramount public interest.
Bhagat Singh v. CIC (2007, Delhi HC) — the burden of establishing the fiduciary (or any) exemption is on the authority.
Girish Ramchandra Deshpande v. CIC (2013) — an individual customer’s private financial data remains personal and exempt under s. 8(1)(j).

📄 Full notes + Question Bank (₹199) — every topic in depth, model answers to all past KSLU questions, in one printable PDF. Get the bundle · 10 Solved Problems · All Right to Information (RTI) topics