RBI refuses to disclose names of loan defaulters

SansadTV Bureau
File photo of exterior of Reserve Bank of India in Mumbai.

File photo of exterior of Reserve Bank of India in Mumbai.

The Reserve Bank of India (RBI) has refused to make public the list of loan defaulters with public sector banks despite an order of the Supreme Court in 2015 to make this information public.

The case relates to an RTI application filed by activist Subhash Agrawal who had sought to know the list of people who had defaulted in the loan of Rs one crore and above.

According to the government, the gross non-performing assets (NPA) of the public sector banks stood at Rs 6.06 lakh crore as on December 31, 2016.

The RBI had denied the information citing the clauses of economic interests of the state, the commercial confidence and the information held in fiduciary capacity.

It had also cited the provisions of Section 45-E of the RBI Act, 1934 which prohibits disclosure of credit information.

On December 16, 2015 the apex court had clearly rejected these arguments of the RBI, in a matter filed by another RTI applicant, and ordered disclosure of defaulters’ list, upholding a Central Information Commission (CIC) order.

Still, the Bankers’ Bank cited same arguments to deny information to Agrawal, who escalated the matter to the CIC.

During the hearing, the RBI also said the Supreme Court is hearing a matter in which reports have been sought in a sealed envelop and hence any decision should be avoided.

A two-member CIC bench gave reprieve to the RBI as it agreed to not pass any order till the pending matter, where disclosure of defaulters having dues of over Rs 500 crore towards the banks, was decided by the apex court.

The bench, comprising Information Commissioners Manjula Prasher and Sudhir Bhargava, did not accept Agarwal’s plea that a case was already decided by the Supreme Court in which clear directives have been given and is a law of land, and not a pending case.

In 2015, the apex court had stated that the RBI is supposed to uphold public interest and not the interest of individual banks.

The RBI is clearly not in any fiduciary relationship with any bank, it had said.

“The RBI has a statutory duty to uphold the interest of the public at large, the depositors, the country’s economy and the banking sector,” it had said while directing the RBI to disclose the list of defaulters.

The court had said that the RBI is duty bound to comply with the provisions of the RTI Act.

“The baseless and unsubstantiated argument of the RBI that the disclosure would hurt the economic interest of the country is totally misconceived,” the court had said.

The apex court had said that the facts reveal that banks were trying to cover up their underhand actions, they are even more liable to be subjected to public scrutiny.