supreme court
supreme court

SC gives Centre, RBI time to devise plan for depositing demonetised currency

The Supreme Court today granted the Centre and the Reserve Bank of India two weeks to consider the option of granting a window to those who could not deposit their demonetised Rs 500 and Rs 1,000 currency notes for a compelling reason.

A bench comprising Chief Justice J S Khehar and Justice D Y Chandrachud asked Solicitor General Ranjit Kumar, representing the Centre, to take instructions on the issue.

“There can be a situation where a person has lost his/her money for no fault. Suppose a person was in jail during the period… We want to know as to why you chose to bar such persons,” the bench said.

The solicitor general then sought time to seek instructions for granting an opportunity to persons to deposit their money on a case-by-case basis.

The bench was hearing a batch of petitions, including one filed by Sudha Mishra seeking a direction to authorities to allow her to deposit demonetised notes as she could not do so during the period specified by the Centre and the RBI.

The Central government had on November 8 last year announced that Rs 500 and Rs 1,000 notes would no longer be legal tender from November 9.

The government also assured the people that demonetised currency notes could be exchanged at banks, post offices and RBI branches till December 30, 2016. If people were unable to deposit them by that day, they could do so till March 31, 2017 at RBI branches after complying with certain formalities.

On March 21, the apex court asked the government why it chose not to create a separate category for those who couldn’t deposit demonetised notes by December 30, 2016 unlike NRIs and people who were abroad.

The Centre informed the court that it had taken a “conscious decision” not to extend the period beyond December 30 last year for exchanging demonetised currency notes.

It also said it was not legally bound to come out with a fresh notification to grant a grace period or a window for depositing scrapped currency notes.

The apex court had on March 6 sought responses of the Centre and RBI on why demonetised notes were not accepted till March 31 as was promised.

On March 10, it sought replies from the Centre and RBI on the plea against tweaking of rules on exchange of demonetised currency.

Prime Minister Narendra Modi’s address to the nation on the evening of November 8 last year on demonetisation and the subsequent notification of the federal bank that banned notes can be exchanged at RBI offices even up to March 31, 2017 were valid assurances which stood breached by the ordinance, counsel for the petitioner, Sudha Mishra, had said.

The plea alleged that the prime minister and RBI had assured people at large that demonetised currency notes could be exchanged till December 30, 2016 and then on March 31, 2017 at RBI branches after complying with formalities.

The petitioner referred to the Specified Bank Notes Cessation of Liabilities Ordinance and said it had breached the assurance.

The Ordinance said only those who were abroad, armed forces’ personnel posted in remote areas or others who could give valid reasons for not being able to deposit the cancelled notes at banks could deposit demonetised notes till March 31 this year after the deadline expired on December 30, 2016.

The Centre had come out with the Ordinance making possession of a large number of scrapped notes a penal offence attracting a monetary fine.


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