New Delhi:The government suffered another jolt with the Supreme Court refusing to restrain high courts across the country from taking up issues arising out of its decision to demonetize Rs 1000 and Rs 500 currency notes, saying people may get “immediate relief” from them. The Centre’s claim that demonetization was a “success” as over Rs six lakh crore have already been deposited and about Rs 10 lakh crore was expected to come to the exchequer till December end which would prevent hoarding of cash, failed to cut ice with the apex court as it refused to stay the ongoing proceedings before the high courts. The setback to the government came in quick succession as the apex court on November 18 had refused to stop high courts from entertaining challenges to the November 8 notification, observing that people were seriously affected and doors of courts cannot be shut in a situation which “may lead to riots”.
Despite the government making a fervent plea for stay on high courts’ proceedings in demonetization cases on the ground that the situation was “much better” with long queues declining and there was “a big surge in digital use of money transaction,” a bench headed by Chief Justice T S Thakur said, “We don’t want to stay it.” “There are various issues. People may get immediate relief from the high courts,” the bench, also comprising Justices D Y Chandrachud and L Nageswara Rao, said. Some of the issues which have come up before high courts are for removing the weekly cap of Rs 24,000 on withdrawals, questioning the use of old currency notes of Rs 1,000 and Rs 500 at public utility centres like hospitals and petrol pumps and direction to ensure sufficient cash in ATMs.
Attorney General Mukul Rohatgi’s submission that over Rs six lakh crore have been deposited so far and queues in banks, ATMs, post offices have shortened remarkably and, if required, the time limit of depositing and exchanging the Rs 1,000 and Rs 500 old notes may be extended beyond December 30, did not impress the bench to provide any relief to the Centre.
The high denomination currency notes of Rs 1000 and Rs 500 used to constitute 80 to 85 per cent of the legal tender and the top law officer said demonetizing them was a “move to remove 70 years of slush money.” “If it takes another 20-30 days to remove it, I do not think its a big deal,” he told the bench adding that “it is a success till now.” “The money will be used in the economy and the lending rates will come down,” he told the bench which only issued notices and sought the response of those who have approached different high courts on the Centre’s plea seeking transfer of the matters to the apex court or any one of the high courts.
The apex court posted the transfer petition of the Centre for hearing on December 2 and said it will hold its scheduled hearing on main matters on Friday in which some public spirited persons and advocates have not only questioned the legality of the notification but have also raised other issues including unpreparedness of the Modi dispensation in implementing the controversial decision.
The day’s hearing saw the bench asking the Attorney General about the situation and steps taken by the government on the issue.
“We think you must have taken appropriate steps. What is the situation now? We believe that the situation has improved,” the bench asked.
The Attorney General assured the bench that the situation was “much better” and the government was monitoring it “day-by-day and hour-by-hour” and “a committee has been set up to go across the country to take stock of the ground situation of the demonetization move”.
When the bench asked “How much have you collected”, Rohatgi gave the figure of over Rs six lakh crore. To this, the bench said the total value of the demonetized currency notes was around Rs 15 lakh crore.
“If you will get around Rs 10 lakh crore, will you say it is a success,” the bench asked. Rohatgi said he would file an affidavit giving details of the money deposited.
“There is a big surge in digital use of money transaction after the demonetization move. The idea is to move as per the general rule which says that cash money in the market should be around four per cent of the GDP. It is around 12 per cent of the GDP in India. The more cash you have in the market, the more the people will hoard. The aim is to reduce it to around eight per cent of the GDP,” he said. Rohatgi also told the bench that there was no shortage of currency notes but the problem was in transporting them to every corner of the country.