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Why NSE must not be brought under RTI

While entities that most citizens instinctively regard as ‘public institutions’ have increasingly escaped the RTI Act, courts have shown a greater willingness to subject private commercial institutions to it.

Earlier this month, Justice C Hari Shankar and Justice Om Prakash Shukla of the Delhi High Court held that the National Stock Exchange, or NSE, is a “public authority” under the Right to Information Act. The judgment is yet another example of a disturbing irony in RTI jurisprudence. 

While entities that most citizens instinctively regard as “public institutions” have increasingly escaped the RTI Act, courts have shown a greater willingness to subject private commercial institutions to it. Institutions such as the PM CARES Fund, the Prime Minister’s National Relief Fund, and the BCCI — all of which occupy spaces of immense public significance — have successfully resisted the RTI framework. On the other hand, the RTI is being gradually expanded to cover entities performing purely commercial functions. 

The Delhi High Court judgment is problematic as it equates government control with government regulation in classifying NSE as a “public authority”. While Indian court judgments are generally critiqued for their unintended consequences, this judgment has obvious and harmful consequences for the integrity of the securities markets, and more generally, for all regulated entities. Courts appear to have lost sight of why transparency obligations exist for the government and not for private entities performing commercial functions in the first place. 

Confusing regulation with control

The case in question began in 2007 when the NSE challenged the Central Information Commission’s order in the Delhi High Court. Three years later, Justice Sanjiv Khanna held that NSE was subject to the RTI Act. NSE appealed before a two–judge bench of the same court. Sixteen years, 29 hearings, and six bench changes later, the court........

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