The Supreme Court on Friday asked the central government if the Reserve Bank of India (RBI) had informed it that demonetisation will result in the withdrawal of over 86% currency in circulation.
Making a query to the Centre as part of its consideration of a bunch of petitions challenging the November 8, 2016 notification, a five-judge Constitution bench said, “Did the RBI inform Government that 86.4% currency would be withdrawn from circulation? This was an enormous action.”
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Under the Reserve Bank of India (RBI) Act Section 26(2), a recommendation by the RBI’s Central Board precedes any decision to demonetise any series of currency notes.
At the time of the note ban, ₹17.97 lakh crore currency was in circulation, of which, the demonetised bank notes valued ₹15.44 lakh crore — constituting 86.4% of the currency in circulation, according to data produced by Congress leader and senior advocate P Chidambaram on Thursday. Of this 98.9% demonetised notes came back, valuing ₹15.31 lakh crore, he added.
Limiting its scrutiny to what weighed with the Centre in arriving at the decision, the bench headed by Justice S Abdul Nazeer said, “If this was informed (by RBI), we would like to know whether the Government would have done it or not.”
{{/usCountry}}Limiting its scrutiny to what weighed with the Centre in arriving at the decision, the bench headed by Justice S Abdul Nazeer said, “If this was informed (by RBI), we would like to know whether the Government would have done it or not.”
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