Increasing time to deposit old notes defeats demonetisation: Centre to SC


Increasing time to deposit old notes defeats demonetisation: Centre to SC

Earlier on July 4, the apex court rapped the Centre and asked them to give another chance to "genuine people to deposit old notes", to which the Centre was given two weeks to respond. The committee has given the RBI chief 15 days time to submit data on deposits of the defunct Rs 500 and Rs 1,000 bank notes.

Noting that these people had over 51 days to deposit and exchange their old notes for the new currency through multiple outlets, the NDA government, in an affidavit filed through the Ministry of Finance, said now there exists "no necessity or any justifiable reason" to provide them a "grace period" till December 30, 2017, as many petitioners have sought in a bunch of petitions.

After being recommended by the Supreme Court to provide the people with a "window of opportunity" to deposit their old currency notes, Centre said the move would defeat the objective of the demonetisation drive.

Any number of "benami" transactions and proxy users for the goal of producing and depositing the old notes would then arise and the departments would have great difficulty in deciding any genuine case from the numerous bogus ones, it said, and sought dismissal of petitions seeking another chance.

Prime Minister Narendra Modi had surprised the nation on November 8 when he declared the old Rs 500 and 1000 notes invalid. The Centre had later introduced a new Rs 500 and Rs 2000 note with the aim of fighting corruption and eliminating black money.

"In other words, what was permitted was exchange and or deposit of specified bank notes during a block period a period up to and including December 30, 2016, either in person or through authorised third person", it said.

The demonetisation of high denomination notes was announced on November 8.

The government had assured the people that demonetised currency notes could be exchanged at banks, post offices and RBI branches till December 30, 2016.

People, however, still had time to exchange the currency notes at designated RBI counters till March 31 after giving valid reasons for not depositing defunct notes in their accounts by December 30.

The Prime Minister's address to the nation on the evening of November 8 past year on demonetization and subsequent notifications of the federal bank that the devalued currency notes can be exchanged at RBI offices even up to March 31, 2017 were valid assurances which stood breached by the ordinance, the counsel for petitioner Sudha Mishra had said.

These, the government said, forced the government to cancel or restrict exemptions granted.