Battle over NPAs: BoB, SBI, RBL, Yes Bank move CIC against RTI orders, RBI backs disclosure

Four major banks — Bank of Baroda, RBL Bank, Yes Bank and State Bank of India — have approached the Central Information Commission (CIC) objecting to the disclosure of sensitive regulatory information such as lists of defaulters, non-performing assets (NPAs), inspection reports and penalty-related documents, even as the Reserve Bank of India (RBI) has maintained that the records are “liable to be disclosed” under the Right to Information (RTI) Act, according to a PTI report. 

The objections stem from multiple RTI applications filed by applicants Dheeraj Mishra, Vathiraj, Girish Mittal and Radha Raman Tiwari, who sought details including the top 100 NPAs and willful defaulters of Yes Bank, inspection reports of SBI and RBL Bank, and documents related to a Rs 4.34 crore monetary penalty imposed on Bank of Baroda following statutory inspection findings. 

After examining the requests, the RBI concluded that the information could be disclosed under the RTI Act and sought the banks’ views under the third-party consultation provision of Section 11. Disagreeing with the RBI’s position, the banks challenged the decision before the CIC, arguing that disclosure would harm their commercial interests and expose confidential supervisory information, the PTI report added. 

Information Commissioner Khushwant Singh Sethi has now referred all the cases to a larger bench of the CIC, citing the significance of the issues involved and the fact that similar matters had earlier been examined by a double bench. Disclosure has been stayed until final adjudication. 

The RBI has consistently relied on the Supreme Court’s landmark 2015 ruling in Jayantilal N Mistry vs RBI, which held that inspection reports, defaulters’ lists and related supervisory information must be disclosed in the larger public interest and that the RBI does not hold such information in a fiduciary capacity for banks, as per the report. 

What banks said

In one case, Bank of Baroda objected to the disclosure of documents relating to a Rs 4.34 crore penalty imposed after statutory inspections. The RBI rejected the bank’s claim that disclosure would adversely affect its business or competitive position, noting that exempt information under Sections 8(1)(d), (e) and (j) of the RTI Act had already been severed. Bank of Baroda has since approached the Supreme Court, seeking reconsideration of the Jayantilal N Mistry judgment. 

RBL Bank similarly opposed disclosure of its inspection reports for 2013-14 and 2016-17. The RBI countered that Supreme Court precedent remains binding and quoted contempt proceedings in which the apex court warned that failure to disclose inspection reports would be viewed seriously. Despite noting that no stay has been granted by the Supreme Court, the CIC has referred the matter to a larger bench. 

Yes Bank has challenged the proposed disclosure of its top NPAs, willful defaulters and inspection reports, even as the RBI reiterated that the RTI Act overrides all earlier laws and that the Supreme Court has explicitly upheld disclosure of such information. 

State Bank of India, meanwhile, objected to the release of show-cause notices and RBI enforcement actions from April 2015 onwards. The RBI held that the documents were disclosable after severing exempt portions, stressing that it is not in a fiduciary relationship with banks and must act in public interest.