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Published On: Sun, Dec 11th, 2016

Notebandi : “The government is not sitting around doing nothing Says Govt.

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indexNEW DELHI : Call it a coincidence or whatever. Last Friday the same day things seem to be moving on the front to minimise the pains of the people from all walks of walks on account of the demonitisation, the Supreme Court of the country heard from the creamy lawyers of the country including the government top attorney, Attorney General Mukul Rastogi on a clutch of petitions across the courts in the country challenging the historic November 8 announcement of the Prime Minis Narendra Modi on withdrawal of Rs. 500 and Rs. 1,000 denomination notes.

The Court is all set to frame a series of questions that it would pose to the Union Government on the entire process behind the decision. Now there is some clarity on what the questions could be on the basis of dispositions from the government as well as all other stake holders.

The Second meeting of the Committee of Chief Ministers, of which the Andhra Pradesh Chief Minister N. Chandrababu Naidu is the Convenor, at a meeting here on Friday reviewed the present situation and asked the Union Government to take more incentives for citizens to move towards digital transactions.

Simultaneously, in a hearing on its decision to impose demonetisation of Rs 500 and Rs 1000 currency notes, the government told the Supreme Court that the problems being faced by people will be over in “10-15 days”.

Attorney General Mukul Rohatgi, representing the government, said it is “not sitting around doing nothing” and claimed no violence or unrest has been reported in the last month.

“The government is not sitting around doing nothing. In 10-15 days, it will all be over,” Rohatgi told a three-judge Supreme Court bench, which is hearing a number of petitions challenging the note ban.

The Supreme Court asked the Centre whether its demonetisation decision was taken in absolute secrecy. The apex court is hearing a plea seeking rationale behind putting the entire nation to “such great difficulties”.

The Supreme Court asked, “When you made the policy on demonetisation, was it confidential?” The three-judge bench has framed nine questions for the adjudication to decide whether demonetisation was unconstitutional or not.

Appearing on behalf of the petitioner, noted lawyer Prashant Bhusan argued that there was no preparation from the government to deal with the impending situation caused by demonetisation.

“There was no cash in ATMs, recalibration was not done well and cooperative banks were being discriminated against,” Prashant Bhushan told the apex court. Senior counsel Kapil Sibal, appearing for another petitioner, told the court that contrary to the government’s claim, there was no cash in the banks.

Former Finance Minister and senior counsel P Chidambaram told the court that all the Reserve Bank of India printing presses can print only 300 crore currency notes per month.

Replacing every demonetised note with a new note will take at least six months, Chidambaram told the court. Last week, the apex court had asked the government to see if something could be done to lessen troubles people were going through since demonetisation was announced on November 8.The matter will be next heard on December 14.

In its observations, the Supreme Court asked the government to state the threshold limit of cash that each account holder can withdraw from banks across the country without being refused.

The bench of Chief Justice TS Thakur, Justice AM Khanwilkar and Justice DY Chandrachud also asked the government to state if it could relax curbs on accepting deposits by the district cooperative banks after imposing certain conditions.

On cash withdrawals, the court asked the Centre to spell out the limit of cash an account holder can withdraw as it was told that though the government said each account holder can withdraw up to Rs 24,000 per week, the banks were instead giving them only Rs 8,000 to Rs 10,000.

The Supreme Court was hearing on a batch of petitions and public interest litigations (PILs) challenging the demonetisation policy of the Central Government. On Monday, the hearing of the matter was adjourned as Chief Justice of India TS Thakur was on leave. The hearing continues to be a non-starter with three adjournments.

Several petitions were filed, including one by Vivek Narayan Sharma, against the policy that has “caused massive upheavals” across the nation. The petitioners have questioned the government’s rationale and modus operandi behind the implementation of the policy, as it has reportedly caused inconvenience to the general public.

On November 23, the Supreme Court in a separate case sought response of all the petitioners, who have challenged the demonetisation move in different high courts. It issued notices to the petitioners on a plea by the Centre seeking transfer of all these matters to either the apex court or one of the high courts.

A three-judge bench, however, refused the Centre’s request to stay the proceedings pending before various high courts, saying people may get “immediate relief” from them.

During the hearing, the bench asked Attorney General Mukul Rohatgi about the appropriate steps considered by the government after demonetisation. Responding to it, the Attorney General said the situation is “much better”.

He told the bench that government had set up a committee that would assess the ground situation in the country on demonetization. Senior Advocate Kapil Sibal and Attorney General Mukul Rohatgi suggested most of the issues which the Court could consider for framing issues for final hearing.
The court noted the following issues raised by the parties:

1. Whether the notification of November 8 is ultra views Section 26(2) of the RBI Act.

2. Whether the notification of November 8 and all subsequent notifications is contrary to Article 300A.

3. Assuming that the notifications have been issued validly under S. 26(2), whether it falls foul of Articles 14 and 19(1)(g).

4. Whether restrictions on withdrawal of money has any basis and whether it violates Articles 14, 19 and 21.

5. Whether the manner in which the notification is sought to be implemented is “procedurally unreasonable”.

6. Whether District Co-operative Banks have been discriminated against by excluding them from accepting deposits, exchanging old notes and denying withdrawal of money.

7. What is the scope of judicial review in a matter touching fiscal/economic policy?

8. Whether Section 26(2) amounts to excessive delegation of powers and is therefore ultra vires the Constitution.

9. Whether a petition by political party on the issue is maintainable under Article 32.

10. Whether Devanagari numerals can be used on currency notes.

11. Whether the impugned notification is violative of Sections 7, 23, 24, 29 and 42 of the RBI Act.

The court will now frame the issues to be heard in the case, taking into account the above suggestions.

The Bench also asked Attorney General Rohatgi about interim measures that could be adopted to alleviate the difficulties faced by people. Chief Justice Thakur said,

“We would like to hear the parties regarding interim measures that could be taken while the matter is being heard without affecting the larger object you had in mind.”

The restriction placed on District Co-operative banks was one of the major issues over which the parties and the central government differed considerably during the hearing. Rohatgi said that DCCBs don’t adhere to KYCs and stood firm on the restrictions imposed on them.

The case will now be heard on December 14, when the Court will frame the issues to be heard. Chief Justice TS Thakur is retiring on January 3 next year, and the December 14 hearing could very well be his final one in this matter.

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