Supreme Court Refuses To Stay Demonetisation But Says Citizens Should Not Suffer
The Supreme Court on Tuesday refused to stay the demonetisation of old Rs 500 and Rs 1,000 currency notes but directed the government to submit a report detailing the steps taken to minimise public inconvenience.
"We don't intend to interfere with the policy but we want to know what steps you are taking to reduce inconvenience caused to the public. The common man must not suffer," observed the Chief Justice of India.
The apex court was responding to four public interest litigations (PILs) demanding rollback of the government's decision to withdraw old currency notes.
Senior advocate Kapil Sibal, who was representing one of the petitioners, argued that the Reserve Bank of India's rules and Act provides for discontinuing particular series of currency notes. The petitioners are challenging the constitutional validity of the government's notification on demonetisation and not pressing for a stay on it, he said.
In 1956, demonetisation was done for notes that were issued prior to 1946. These were a series of higher denomination notes that were discontinued. At that time higher denomination notes contributed to only 2 percent of the economy and now it's 85 percent. You can't let a poor man suffer.Kapil Sibal, Senior Advocate
“The government is trying to wipe off bad debts or non-performing assets by collecting all this money and taxing the poor and favouring the rich,” he added.
The Attorney General of India Mukul Rohatgi refuted all arguments by saying that the RBI Act does not require prior notice and said no new law has to be laid down for demonetisation. "The whole exercise is done with a three-fold agenda which includes doing away with fake notes and curbing black money," said the AG.
The Chief Justice of India-led bench asked the government to explain the rationale behind limiting the number of withdrawals and exchange of old notes. "Is the government taking any steps to ensure less inconvenience?" the bench observed.
To this the Attorney General responded, “We are issuing notifications every day to increase the withdrawal limit so that there is no inconvenience. We had to put limits so that the first few who come to the banks do not take away all the money.”
It was necessary for the government to not recalibrate ATMs ahead of the announcement as “the cat would have been out of the bag”, he added.
The AG said new currency worth Rs 55,000 crore has been distributed to banks and post offices so far. "We cannot divulge details of rest of the money being released due to secrecy but hourly distribution is being done. Banks have received 3.25 crore cash through deposits of Rs 500 and Rs 1,000 notes so far," he informed the court.
The apex court will hear the matter next on November 25.
Also Read: Exchanging Old Notes Will Now Leave Indelible Ink On Your Finger
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