Banking secrecy

N THE SUPREME COURT OF INDIA

Civil Appeal Nos. 6350-6374 of 1997 with C.A. 7079/2004 (Arising out of SLP (C) No. 11607/2001)

Decided On: 01.11.2004

Appellants: Distt. Registrar and Collector, Hyderabad and Anr.
Vs.
Respondent: Canara Bank Etc.

JUDGMENT

R.C. Lahoti, C.J.

1. Leave granted in SLP (C) No. 11607/2001.

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Once we have accepted in Govind and in latter cases that the right to privacy deals with 'persons and not places', the documents or copies of documents of the customer which are in Bank, must continue to remain confidential vis-`-vis the person, even if they are no longer at the customer's house and have been voluntarily sent to a Bank.

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Once that is so, then unless there is some probable or reasonable cause or reasonable basis or material before the Collector for reaching an opinion that the documents in the possession of the Bank tend, to secure any duty or to prove or to lead to the discovery of any fraud or omission in relation to any duty, the search or taking notes or extracts therefore, cannot be valid.

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In Smt. Maneka Gandhi Vs. Union of India & Anr., (1978) 1 SCC 248  a 7-Judges Bench decision, P.N. Bhagwati, J. (as His Lordship then was) held that the expression 'personal liberty' in Article 21 is of the widest amplitude and it covers a variety of rights which go to constitute the personal liberty of man and some of them have been raised to the status distinguishing as fundamental rights and give additional protection under Article 19 (emphasis supplied). Any law interfering with personal liberty of a person must satisfy a triple test: (i) it must prescribe a procedure; (ii) the procedure must withstand the test of one or more of the fundamental rights conferred under Article 19 which may be applicable in a given situation; and (iii) it must also be liable to be tested with reference to Article 14. As the test propounded by Article 14 pervades Article 21 as well, the law and procedure authorizing interference with personal liberty and right of privacy must also be right and just and fair and not arbitrary, fanciful or oppressive. If the procedure prescribed does not satisfy the requirement of Article 14 it would be no procedure at all within the meaning of Article 21.