SC pulls up Modi govt on demonetisation: Why did you stop deposit of banned notes after Dec 31?

The Supreme Court asked the Centre on Tuesday why it did not give time to people who could not deposit demonetised 500 and 1,000-rupee banknotes before December 31 if their inability to do so was genuine.

A bench headed by chief justice JS Khehar referred to the Prime Minister's November 8 speech and said there was a promise that those with difficulty to deposit demonetised notes will get chance till March 31.

"You may have a discretion, but it cannot be an arbitrary exercise. From your submission it seems that you are the final and we are not willing to accept it," the bench told attorney general Mukul Rohatgi who said Parliament had left the government with the choice to define the class that could avail the window.

The court was hearing petitions challenging the government's decision to deny them time beyond December 31 to deposit old notes with RBI-designated banks. An ordinance made possession of outdated currency a criminal offence and those with such notes can be prosecuted.

Modi's shock announcement had led to a rush in banks by people and business houses to exchange the old notes, besides sparking a crippling



currency shortage. The government described the exercise a surgical strike on black money.

The opposition had, however, accused the government of faulty implementation leading to people sufferings from the cash crunch.

"Parliament asked us to find the category and we have done so by keeping the window open for NRIs," Rohatgi told the court.

The court, however, did not appreciate the government's move to issue the ordinance on December 30, without any notice that the window was closed.

"If the ordinance had come a week before, people would have got time. Everybody knew from the PM's speech and the notification that there would be some more time. Nobody realised the PM's words can be taken back," the CJI remarked, giving time till April 11 to the government to file its affidavit.

"You must explain why the window was given only to NRIs and not (other) citizens," the bench said. It had a word of caution for the petitioners who were warned of facing criminal case if they lost the case.

However, Rohatgi offered a window to them and said the petitioners would not be prosecuted if they withdrew their pleas.