W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 1 of 47 IN THE HIGH COURT OF DELHI AT NEW DELHI W.P.(C) 6129/2007 Reserved on: 12th March 2010 Decision on: 14th May 2010 KRISHAK BHARTI COOPERATIVE LTD. ..... Petitioner Through: Mr. Om Prakash, Advocate versus RAMESH CHANDER BAWA ..... Respondent in person W.P.(C) 7787/2008 NATIONAL AGRICULTURAL COOPERATIVE FEDERATION OF INDIA LTD. ..... Petitioner Through: Mr. V.P. Singh, Sr. Advocate with Ms. Anju Bhattarcharya, Mr. Om Prakash and Mr. M.I. Chaudhary, Ms. Maninder Acharya, Advocates. versus B.M. VERMA ..... Respondent Mr. Brahm Dutt with Mr. Deepak Pandey, Advocates W.P.(C) 7770/2008 NATIONAL COOPERATIVE CONSUMER FEDERATION OF INDIA LTD. ..... Petitioner Through: Mr. V.P. Singh, Sr. Advocate with Ms. Anju Bhattarcharya, Mr. Om Prakash and Mr. M.I. Chaudhary, Advocates. versus RAJ MANGAL PRASAD ..... Respondent Through: Mr. Brahm Dutt with Mr. Deepak Pandey, Advocates W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 2 of 47 CORAM: JUSTICE S. MURALIDHAR 1. Whether reporters of local paper may be allowed to see the judgment? Yes 2. To be referred to the report or not? Yes 3. Whether the judgment should be referred in the digest? Yes JUDGMENT 14.05.2010 The Question 1. A feature common to the three petitioners - the Krishak Bharti Co-operative Ltd. (KRIBHCO) [the petitioner in W.P. (C) No. 6129/2007], the National Cooperative Consumer Federation of India Ltd. (NCCF) [the petitioner in W.P. (C) No. 7770/2008] and the National Agricultural Cooperative Federation of India Ltd (NAFED) [the petitioner in W.P.(C) No. 7787/2008] – is that each is a society deemed to be registered under the Multi-State Co- operative Societies Act, 2002 („MSCS Act‟). The question for consideration is whether each petitioner is a “public authority” within the meaning of Section 2(h) of the Right to Information Act, 2005 (RTI Act)? The Central Information Commission (CIC) has, by an order dated 9th September 2008 (in the case of NAFED and NCCF) and by an order dated 10th July 2007 (in the case of KRIBHCO) answered the question in the affirmative. The CIC‟s aforementioned orders have been challenged in these petitions. W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 3 of 47 The Context 2. Before proceeding to notice the facts in each of the petitions, it is necessary to interpret the words “public authority” under Section 2 (h) of the RTI Act given the context of the RTI Act and in relation to the MSCS Act. The Statement of Objects and Reasons (SOR) of the RTI Act indicates that in order to ensure greater and more effective access to information, the earlier Freedom of Information Act, 2002 was extensively overhauled. It was envisaged that there would be an appellate machinery with investigating powers to review the decisions of the Public Information Officers. The RTI Act has provisions that make the failure to provide any information as per law punishable with fine. It has “provisions to ensure maximum disclosure and minimum exemptions, consistent with the constitutional provisions, and effective mechanism for access to information and disclosures by authorities.” 3. The preamble to the RTI Act indicates that it is a statute to provide for “setting out the practical regime of right to information for citizens to secure access to information under the control of public authorities, in order to promote transparency and accountability in the working of every public authority, the constitution of a Central Information Commission and State Information Commissions and for matters connected therewith or W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 4 of 47 incidental thereto.” The preamble to the RTI Act notes that “democracy requires an informed citizenry and transparency of information which are vital to its functioning and also to contain corruption and to hold Governments and their instrumentalities accountable to the governed;”. 4. It is in the background of the above „context‟ of the RTI Act that its provisions have to be interpreted. Section 2 which is the definition section begins with the words “In this Act, unless the context otherwise requires…”. The learned author Justice G.P. Singh observes: “When the question arises as to the meaning of a certain provision in a statute, it is not only legitimate but proper to read that provision in its context.” (G.P.Singh, Principles of Statutory Interpretation, 9th Edn. 2004, p.31) In R.S. Raghunath v. State of Karnataka, (1992) 1 SCC 335 it was observed (SCC at p. 347): “It is also well settled that the Court should examine every word of a statute in its context and to use context in its widest sense. In Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd.(1987) 1 SCC 424 it is observed that: “That interpretation is best which makes the textual interpretation match the contextual.” In this case, Chinnappa Reddy, J. noting the importance of the context in which every word is used in the matter of interpretation of statutes held thus: (SCC p. 450, para 33) “Interpretation must depend on the text and the context. They are the bases of interpretation. One may W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 5 of 47 well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statute-maker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place.” 5. In AG v. HRH Prince Ernest Augustus (1957) 1 All ER 49 (at p. 61) it was observed by Sir John Nicholl: “The key to the opening of every law is the reason and the spirit of the law – it is the animus imponentis, the intention of the law-maker, expressed in the law itself, taken as a whole. Hence to arrive at the true meaning of any particular phrase in a statute, that particular phrase is not to be viewed detached from the context – meaning by this as well the title and the preamble as the purview or enacting part of the statute.” 6. It is plain that the provisions of the RTI Act have to be interpreted keeping in view the SOR, the Long title and the Preamble to glean the legislative intent and the context. As observed in the above decisions, the other provisions of the RTI W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 6 of 47 Act also indicate its overall context. The expression „right to information‟ has been defined in Section 2(j) to mean the right to information accessible under the Act “which is held by or under the control of any public authority”. The expression „information‟ under Section 2 (f) has been defined to mean “material in any form, including records, documents, memos…..which can be accessed by a public authority under any other law for the time being in force”. Section 4 spells out the obligations of public authorities which include maintenance of all its records, publishing the particulars of its organization, functions, duties, the procedure followed in the decision-making process for the discharge of its functions and so on. What is interesting in the context of the present cases, is that the obligation under Sections 4 (1)(b) (xii) includes the dissemination by such public authority of “the manner of execution of subsidy programmes, including the amounts allocated and the details of beneficiaries of such programmes”. Under Section 4 (2), the public authority is expected to suo motu take steps to provide as much information to the public at regular intervals through various means of communications, including internet, so that “the public have minimum resort to the use of this Act to obtain information”. There can, therefore, be no manner of doubt that the RTI Act casts a statutory obligation on a public authority to disclose the information held by it which is accessible to the public. The overall purpose and context is to usher W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 7 of 47 transparency and accountability into the working of every public authority. 7. The RTI Act, after several amendments to its predecessor statute i.e. the Freedom of Information Act 2002, received the assent of the President and came into force on 12th October, 2005. It is still the initial phase of the implementation of the RTI Act. Not surprisingly, therefore, many institutions and entities are unclear whether they are a „public authority‟ and whether they are therefore required to comply with the statutory requirements under the Act. Section 24 exempts from disclosure information concerning certain organisations which are listed in the Second Schedule. Again this immunity is not a blanket one. It cannot be invoked where the information pertains to either violation of human rights or corruption. 8. The initial attempt by most organizations and entities is to avoid the obligations under the RTI Act. Since the culture of transparency has not fully set in, and old habits die hard, there is a resistance on the part of institutions and entities to avoid being declared a „public authority‟. So it is with the three petitioners, KRIBHCO, NCCF and NAFED. Reading Section 2(h) 9. Now turning to Section 2 (h) of the RTI Act, it reads as under: W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 8 of 47 “2. In this Act, unless the context otherwise requires - (h) “public authority” means any authority or body or institution of self-government established or constituted,-- (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government Organisation substantially financed, directly or indirectly by funds provided by the appropriate Government;” 10. On a plain reading of the provision, the expression “public authority” can mean: (a) an authority or a body or an institution of self-government established or constituted by or under the Constitution, (b) an authority or a body or an institution of self-government established or constituted by a law made by Parliament, (c) an authority or a body or an institution of self-government established or constituted by a law made by the State legislature, (d) an authority or a body or an institution of self-government established or constituted by a notification issued or order made by the appropriate government. 11. While there is no question that each of the three entities, KRIBHCO, NCCF and NAFED, is a „body‟ none of them is either an institution constituted or established “by or under” the Constitution or “by” a central or state legislation. The legislature W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 9 of 47 has made a conscious distinction between “by or under” (which is used in relation to the Constitution) and “by” in relation to a central or state legislation. If, therefore, it was enough for the body to be established “under” a central or state legislation to become a public authority then each body registered or deemed to be registered under the MSCS Act or for that matter every company registered under the Companies Act would be a „public authority‟. However that is not the case here. 12. If, therefore, none of these entities is a body that answers the description of being established or constituted under a Constitution, or by a law made by the Parliament or by the State Legislature, then the question that next arises is, if any of them is a body established or constituted “by notification issued or order made by the appropriate Government” in terms of Section 2 (h) (d) of the RTI Act. It is nobody‟s case that any of these entities has been established or constituted only by a notification issued or an order made by the appropriate Government. That leaves us with the remaining limb of Section 2 (h) (d) which is conjoined with the main provision by the words “and includes”. Therefore, in relation to the present cases, what requires to be examined is whether each of these entities is, in terms of Section 2 (h) (d) (i), a body owned, controlled, or substantially financed by the appropriate government, or in terms of Section 2 (h) (d) (ii), a non-government W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 10 of 47 organisation substantially financed directly or indirectly by funds provided by the appropriate government? Implication of “includes” 13. Before embarking on a more detailed analysis it is necessary to recapitulate the law concerning interpretation of the conjunctive “and includes”. The expression “and includes” connotes that those entities which answer the description following those words need not fall within the definition of entities that precede those words. The word “includes” is generally understood in statutory interpretation as enlarging the meaning of the words or phrases in the body of the statute. In CIT v. Taj Mahal Hotel (1971) 3 SCC 550 the Supreme Court was considering whether the word „plant‟ in Section 10 (2) of the Income Tax Act 1922, include sanitary pipes and fittings in a building as well? Section 10 (5) had defined „plant‟ to include “vehicles, books, scientific apparatus, surgical equipment purchased for the purpose of business.” The Court held: “The word “includes” is often used in interpretation clauses in order to enlarge the meaning of the words or phrases occurring in the body of the statute. When it is so used, those words and phrases must be construed as comprehending not only such things as they signify according to their nature and import but also those things which the interpretation clause declares that they shall include.” W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 11 of 47 14. In Mahalakshmi Oil Mills v. State of A.P. (1989) 1 SCC 164 the Supreme Court was construing the meaning of the word „tobacco‟ under the Andhra Pradesh General Sales Tax Act, 1957 which by incorporation referred to definition in the Central Excises and Salt Act, 1944. The latter Act defined „tobacco‟ to mean “any form of tobacco, whether cured or uncured and whether manufactured or not, and includes the leaf, stalks and stems of the tobacco plant, but does not include any part of a tobacco plant while still attached to the earth.” Since an exemption was granted to such products from sales tax, the assesses wanted the expression to be interpreted as widely as possible and the State as narrowly as possible. In the background of these arguments, it was held (SCC, p.168): “We are inclined to accept the contention urged on behalf of the State that the definition under consideration which consists of two separate parts which specify what the expression means and also what it includes is obviously meant to be exhaustive. As Lord Watson observed in Dilworth v. Commissioner of Stamps1899 AC 99 the joint use of the words “mean and include” can have this effect. He said, in a passage quoted with approval in earlier decisions of this Court: (AC pp. 105-06) “Section 2 is, beyond all question, an interpretation clause, and must have been intended by the legislature to be taken into account in construing the expression “charitable devise or bequest,” as it occurs in Section 3. It is not said in terms that “charitable bequest” shall mean one or other of the things which are enumerated, but that it shall “include” them. The word “include” is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 12 of 47 words or phrases must be construed as comprehending, not only such things as they signify according to their natural import, but also those things which the interpretation clause declares that they shall include. But the word “include” is susceptible of another construction, which may become imperative, if the context of the Act is sufficient to show that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to “mean and include”, and in that case it may afford an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expressions.‟ (emphasis ours)” 15. It must straightway be noticed that Section 2 (h) (d) (i) and (ii) have not been happily worded. The provision has added to the confusion rather than clarifying the position. Perhaps an appropriate manner of reading the said provision would be to ask: (i) is the entity in question a body owned by the appropriate government? or controlled by the appropriate government? or substantially financed by the appropriate government? or (ii) is the entity a non-government organisation substantially financed directly or indirectly by funds provided by the appropriate government? 16. It needs to be further clarified that it is not the case of the respondents here that any of these entities is a “non-government organisation substantially financed directly or indirectly by funds provided by the appropriate government”. That takes them out of the purview of Section 2 (h) (d) (ii). Although it must also be noted that in relation to KRIBHCO the CIC wrongly mentions this provision. The Respondents also do not contend that any of these W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 13 of 47 entities is wholly “owned” by the appropriate government. That then leaves us with only the following question to answer in relation to these three entities: Are KRIBHCO, NCCF and NAFED bodies that are either controlled or substantially financed by the appropriate government? That in turn brings up the question as to when it can be said that a „body‟ is “controlled” by the appropriate government and when can it be said that it is “substantially financed” by the appropriate government? “Controlled” 17. The expression “appropriate government” has been defined under Section 2 (a) of the RTI Act. The government which either establishes or controls or constitutes or owns or controls or substantially finances the entity would be the „appropriate government‟. In the context of the entities deemed to be registered under the MSCS Act, it is possible to have more than one appropriate government. This aspect will be discussed in some detail later. However, the expressions “controlled” or “substantially financed” have not been defined. In order to understand whether a body is “controlled” by the appropriate government one would have to examine its organizational structure, its bye-laws and memorandum and articles of association, if any, and the statutory provisions which envisage control over such bodies by the appropriate government. For the W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 14 of 47 limited purpose of understanding the word “controlled”, an examination is also to be undertaken of the pattern of shareholding or any other form of control of such bodies by the appropriate government. It is in this last context that the provisions of the MSCS Act are relevant. These too will be discussed shortly. 18. A this juncture a brief reference may be made to the legal and ordinary meanings of the word “control”. The word “control” has been defined in Black’s Law Dictionary (6th Edn.) to mean “power or authority to manage, direct, superintend, restrict, regulate, govern, administer, or oversee. The ability to exercise a restraining or directing influence over something.” The Shorter Oxford English Dictionary (5th Edn.) defines it as “the act of power of directing or regulating; command, regulating influence” or “a means of restraining or regulating; a check; a measure adopted to regulate prices, consumption of goods etc.” In both senses therefore the key word is “influence” and not necessarily “domination”. 19. The learned Senior Counsel for the petitioners referred to case law concerning the interpretation by the Supreme Court and the High Courts of the expression „State‟ under Article 12 of the Constitution and whether a body is one which is discharging a public function for the purposes of Article 226 of the Constitution. W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 15 of 47 In the considered view of this Court, neither case law is relevant to the questions that arise in the context of the RTI Act. That is why this Court dwelt on the principles governing „contextual‟ interpretation. In the context of the RTI Act it may well be that a body which is neither a “state” for the purposes of Article 12 nor a body discharging public functions for the purpose of Article 226 of the Constitution might still be a „public authority‟ within the meaning of Section 2 (h) (d) (i) of the RTI Act. To state it differently, while a „body‟ which is either a „state‟ for the purposes of Article 12 or a „body‟ discharging public functions for the purpose of Article 226 is likely to answer the description of „public authority‟ in terms of Section 2 (h) (d) (i) of the RTI Act, the mere fact that such body is neither, will not take it out of the definition of „public authority‟ under Section 2 (h) (d) (i) of the RTI Act. To explain further, it will be noticed that in all the decisions concerning the interpretation of the word „state‟ under Article 12 the test evolved is that of “deep and pervasive” control whereas in the context of the RTI Act there are no such qualifying adjectives “deep” and “pervasive” vis-à-vis the word “controlled.” To illustrate, in Pradeep Biswas v. Institute of Chemical Biology 2002 (5) SCC 111, the Supreme Court summarized the „test‟ as under (SCC at p.134): “The picture that ultimately emerges is that the tests formulated in Ajay Hasia are not a rigid set of principles so that if a body falls within any one of them it must, ex hypothesi, be considered to be a State W.P.(C) Nos. 6129/2007, 7787/2008 & 7770/2008 Page 16 of 47 within the meaning of Article 12. The question in each case would be whether in the light of the cumulative facts as established, the body is financially, functionally and administratively dominated by or under the control of the Government. Such control must be particular to the body in question and must be pervasive. If this is found them the body is a State within Article 12. On the other hand, when the control is merely regulatory whether under statute or otherwise, it would not serve to make the body a State.” (emphasis supplied) 20. Therefore while applying the above test to determine if the body in question was “state” the question to be asked was whether there was „pervasive‟ control over the body by the appropriate government and if that was answered in the affirmative then it may “afford an indication whether a corporation is a State agency or instrumentality.” In the considered view of this Court, since Section 2 (h) (d) (i) RTI Act uses the word “controlled” without any qualification as to the degree of control, it is not to enough show that there is “no deep or pervasive control” over these entities by the appropriate Government. The question is not whether there is “deep” control, whether there is “dominance” by the appropriate government or whether the government‟s nominee directors are in