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2024 Supreme(Online)(CIC) 3747
CENTRAL INFORMATION COMMISSION
ANANDI RAMALINGAM, J
DIVYA MOHTA – Appellant
Versus
Securities and Exchange Board of India (SEBI) Head Office – Respondent
CIC/SEBIH/A/2023/139128
The RTI Act does not obligate public authorities to provide speculative information or opinions, only existing and accessible information.
Headnote:(A) Right to Information Act, 2005 - Section 2(f) - The appellant sought information regarding SEBI's actions against BRH Wealth Kreators Ltd. and related entities, including asset attachments and enforcement actions. SEBI's response indicated that the queries were speculative and not within the definition of 'information' under the Act. (Paras 1, 2, 6, 8)
(B) Public Information Officer's Obligations - The RTI Act does not obligate public authorities to provide information that requires drawing inferences or opinions. The Supreme Court clarified that information must be existing and accessible under the law. (Paras 8)
Facts of the case:
The appellant filed an RTI application seeking detailed information about SEBI's actions against BRH Wealth Kreators Ltd. and related entities, alleging incomplete and misleading responses from SEBI. (Paras 1, 3)
Findings of Court:
The Commission found that the queries were speculative and beyond the scope of the RTI Act's definition of information, leading to the dismissal of the appeal. (Paras 8)
Issues: The main issues included whether SEBI's response constituted adequate information under the RTI Act and the nature of the queries posed by the appellant. (Paras 1, 8)
Ratio Decidendi: The court held that the RTI Act does not require public authorities to provide speculative information or opinions, emphasizing the need for existing and accessible information. (Paras 8)
Result: Appeal dismissed.
O R D E R
1. The Appellant filed an RTI application dated 08.05.2023 seeking information on the following points:
(i) Has SEBI attached any assets and / or properties, including those of the promoters and also directors of BRH Wealth Kreators Ltd?
(ii) If yes, please name the assets and / or properties attached.
(iii) What action Sebi has initiated and I or taken against NSE, BSE, CDSL NSDL and other intermediaries and / or relevant bodies involved / related to the illegal acts of BRH Wealth Kreators Ltd. and HDFC Bank?
(iv) NSE conducted a forensic audit through Ernst & Young ('E & Y" for short) and, in the report dated 26th February 2020, submitted by E&Y it was found that Rs. 116.62/- crores of securities having NIL balance was pledged by BRH which was illegally Invoked by HDFC Bank. NSE had forwarded the forensic audit report – ‘Fiscus-Report BRH Wealth Kreators Private Limited’, to SEBI.
a) Why did the said Forensic Audit Report of BRH gathered and forwarded by NSE, to SEBI, was not relied and / or mentioned in the order dated 21st January 2021, of SEBI against HDFC Bank?
b) Why did the Forensic Audit Report prepared by E&Y of BRH, has not been filed and / or relied upon by SEBI, in Appeal No. 83 of 2021, filed by HDFC Bank against SEBI's order dated 21st January 2021, before Security Appellate Tribunal (SAT) in order to be taken into consideration?
c) How can shares and securities belonging to fully paid clients of SEBI registered broker BRH having NIL (0) outstanding and / or no debit balance can be pledged? Please specify byelaws, rules, regulations and guidelines.
d) Whether shares of the clients held with broker as Margin can be pledged?
(v) I also want the complete information on all the rules / guidelines / law points /
byelaws ln respect of the procedure / rules for broke/s regarding dealing / pledging clients’ shares and securities without their consent, etc./ other related information
2. The CPIO replied vide letter dated 09.06.2023 and the same is reproduced as under:-
“Reply to the Queries 1 and 2:
You may refer to SEBI final order dated January 11, 2023 at www.sebi.gov.in under the head Enforcement - Orders- Orders of Chairperson/Members.
Reply to the Query 3:
Information about any enforcement action taken by SEBI is available on SEBI website www.sebi.gov.in under the head "Enforcement". You may like to refer to this website for updated information from time to time.
Reply to the Queries 4, 6 and 7:
Your queries are hypothetical in nature and are in the nature of seeking clarification/opinion. Accordingly, the same cannot be construed as "information", as defined u/s 2(f) of the RTI Act, 2005.
Reply to the Query 5:
You may refer to SEBI website www.sebi.gov.in under the head "Legal" for SEBI Act, Rules, Regulations, and Circulars.”
3. Dissatisfied with the response received from the CPIO, the Appellant filed a First Appeal dated 16.06.2023 alleging that the information provided was incomplete, false and misleading. The FAA vide order dated 19.07.2023 upheld the reply given by the CPIO.
4. Aggrieved with the FAA’s order, the Appellant approached the Commission with the instant Second Appeal dated 21.09.2023.
5. The appellant’s father attended the hearing through video conference; and on behalf of the respondent Shri Mohd. Atif, CPIO attended the hearing through audio conference.
6. The appellant inter alia relied upon the written submissions extracted as under:
“(I) NSE vide notice dated 30th September 2019, suspended the Kolkata-based SEBI registered broker BMA Wealth Creators Ltd., [renamed as BRH Wealth Kreators Ltd.] with immediate effect for non-compliance with the regulatory provisions of the exchange. The broking house, which has a presence across different States, has a licence to trade in the capital market, futures & options, currency derivatives and MFSS segments.
(II) On 7th October 2019, SEBI suspended and restrained BRH Wealth Kreators Ltd. and seven others from accessing and/or dealing in the Stock Market and ordered the
