Delhi High Court Holds NSE A Public Authority Under RTI Act

New Delhi, Jul 2 (KNN) The Delhi High Court has held that the National Stock Exchange of India (NSE) is a ‘public authority’ under the Right to Information (RTI) Act, 2005, making it subject to the transparency law.

High Court Upholds RTI Applicability to NSE 

A Division Bench comprising Justices C. Hari Shankar and Om Prakash Shukla dismissed the NSE's appeal against a 2010 single-judge ruling that had upheld the Central Information Commission's decision bringing the exchange under the RTI Act.

The court observed that an entity qualifies as a public authority under Section 2(h) of the RTI Act if it is owned, controlled or substantially financed by the appropriate government. 

Relying on the Supreme Court's ruling in Thalappalam Service Cooperative Bank Ltd. v. State of Kerala, the Bench held that the NSE falls within the definition as it is controlled by the appropriate government.

Affirming the earlier judgment, the court said the NSE qualifies as a public authority under the RTI Act despite being incorporated as a private company.

NSE's Arguments Rejected 

The NSE had argued that it is neither owned, controlled nor substantially financed, directly or indirectly, by the government and is only recognised and regulated by the Securities and Exchange Board of India (SEBI). 

It contended that regulatory oversight alone does not make it a public authority.

Rejecting the contention, the High Court upheld the single judge's ruling and dismissed the appeal without imposing any costs.

Impact on MSMEs

The ruling enhances transparency and accountability at the NSE, which can benefit MSMEs by improving access to information on regulatory and operational matters. 

Greater transparency is expected to strengthen investor confidence and create a more predictable environment for MSMEs seeking to raise capital through the capital markets. 

(KNN Bureau)