Activists using regulators as indirect route to get information about private players
The Central Information Commission (CIC) has directed the Securities and Exchange Board of India (SEBI) to provide certain details related to Reliance Industries Ltd. (RIL) under the Right to Information (RTI) Act. The information sought after was the names of twelve entities that short sold Reliance Petroleum shares in the derivatives segment before RIL sold 4.1% in the cash market to earn over Rs 4,000 crore.
It is to be mentioned that private entities don’t fall under the purview of RTI Act. The RTI Act defines the ‘Public Authority’ which are covered under the RTI Act. However, the Sector regulators established by government like TRAI, SEBI, RBI, etc. are covered under the definition of the ‘Public Authority’ as per the RTI Act. Hence many information seekers are resorting to send applications under the RTI Act to the regulators to get details on companies. For example, an RTI reply by the National Pharmaceutical Pricing Authority (NPPA) had revealed that companies such as Cipla, Ranbaxy and Dr Reddy's Laboratories were penalised hundreds of times for overpricing.
The regulators are in a state of dilemma as to what should be shared with an applicant who files an application under the RTI Act.