The Delhi High Court on Wednesday declared the National Stock Exchange (NSE) a 'public authority' under the Right to Information (RTI) Act, 2005. The landmark judgment means that citizens can now enforce their right to seek information from the stock exchange, which was previously not classified as a public body.
Court's Ruling and Implications
A division bench of Chief Justice D.N. Patel and Justice C. Hari Shankar ruled that the NSE performs public functions and is substantially financed by the government, making it a public authority under Section 2(h) of the RTI Act. The court observed that the exchange controls critical infrastructure and has a monopoly over stock trading in India, thus serving a public purpose.
The judgment came on an appeal by the NSE against a 2021 order of the Central Information Commission (CIC) that had directed the exchange to appoint a Public Information Officer and comply with RTI requests. The CIC had held that the NSE is a public authority due to its control by the Securities and Exchange Board of India (SEBI) and its role in the national economy.
Background of the Case
The case originated from an RTI application filed by activist S.C. Agrawal in 2017, seeking details about the NSE's operations and finances. The NSE had refused to disclose information, arguing that it is a private company not covered under the RTI Act. The CIC overruled the NSE's objection, leading to the appeal in the Delhi High Court.
During the hearings, the NSE contended that it is a company limited by shares and not substantially funded by the government. However, the court noted that the NSE was established with government support and continues to receive indirect financial benefits, including tax exemptions and infrastructure support from SEBI.
Reactions and Next Steps
RTI activists hailed the verdict as a victory for transparency. "This ruling ensures that key financial institutions are accountable to the public," said Agrawal. The NSE has not yet announced whether it will appeal the decision to the Supreme Court. The judgment is expected to have wider implications for other stock exchanges and market infrastructure institutions in India.
