‘For our satisfaction’: SC orders Centre, RBI to produce demonatisation files
The petitioners said it was important to review the documents to assess if the RBI considered the impact of the withdrawal of such a large volume of currency which caused agony, loss, and hardship to the people of this country
The Supreme Court on Wednesday directed the ministry of finance and the Reserve Bank of India (RBI) to produce files pertaining to the government’s November 2016 decision to outlaw currency notes of ₹500 and ₹1,000.
A five-judge bench headed by justice S Abdul Nazeer reserved its verdict on a bunch of petitions challenging the 2016 decision that resulted in 86.4% of the country’s currency being taken out of circulation. The bench also told the government’s top law officer Attorney General R Venkatramani that it wanted to examine the “relevant records” of RBI and Centre.
Venkatramani reasoned that much of what is contained in the records was captured in the affidavits filed by the Centre and RBI. But the bench, also comprising justices BR Gavai, AS Bopanna, V Ramasubramanian and BV Nagarathna, was insistent. “It is for our satisfaction.”
On Tuesday, senior advocate P Chidambaram who appeared for one of the petitioners questioned the government’s reluctance to part with crucial documents that went into the decision-making process, calling it a “procedural flaw” by the government.
Chidambaram said the bench should examine the government’s letter of November 7 that asked the RBI’s central board to consider the proposal of demonetisation. RBI recommended demonetisation on November 8.
The government undertook demonetisation under Section 26 (2) of the Reserve Bank of India (RBI) Act, 1934 by getting a recommendation from the Central Board of RBI. The provision empowers the government to declare that “any series of bank notes of any denomination shall cease to be legal tender”.
The petitioners said it was important to review the documents to assess if the RBI considered the impact of the withdrawal of such a large volume of currency which caused agony, loss, and hardship to the people of this country.
The Centre has defended its decision by relying on the larger public interest being served by this measure even as it said that it did not close its eyes to the hardships faced by citizens. It also said that the cutoff date of December 30 to deposit old currency notes did not violate the fundamental rights of citizens.
RBI argued that enough measures were put in place to take stock of the situation and once these measures are provided, it was wrong to suggest that the RBI was “thoughtless” in carrying out this exercise.
Over three dozen petitions have been filed against the Centre’s November 8, 2016, decision, accusing it of violating fundamental rights and being contrary to the law laid down under the RBI Act, 1934.
The petitioners questioned the manner in which demonetisation was carried out and argued that the Centre only gave 24 hours to the RBI board to decide and the haste indicated a lack of prior exercise being undertaken to assess the impact of demonetisation on the people and the nation.
