Supreme Court upheld the demonetisation of 2016, said – there is no flaw in the decision making of the Center

 

• Supreme Court says there were consultations between the Center and the RBI before demonetisation

The Supreme Court on its first working day of 2023 upheld the central government's 2016 decision to demonetise currency notes of ₹500 and ₹1000 denominations.

A five-judge constitution bench headed by Justice S A Nazeer, who will retire on January 4, delivered its verdict on the matter. A five-judge constitution bench dismissed a batch of petitions challenging the Centre's 2016 decision to demonetise Rs. 500 and Rs. 1000 currency notes and says that the decision, being economic policy of the executive, cannot be reversed.

The Supreme Court says that there was a consultation between the Center and the RBI before demonetisation.

The Supreme Court says that there was a reasonable nexus to bring about such a measure, and we hold that demonetisation was not affected by the principle of proportionality.

Besides Justices Nazeer, Gavai and Nagaratna, the other members of the five-judge bench are Justices AS Bopanna and V Ramasubramanian.

Earlier, it had asked the Center and the Reserve Bank of India to produce the records related to the 2016 demonetisation decision in a sealed cover.

He had said that he has the power to investigate the manner in which the decision of demonetisation was taken and the judiciary cannot sit with folded hands just because it is an economic policy decision.

The apex court's remarks came after the counsel for the Reserve Bank of India submitted that judicial review is not applicable to economic policy decisions.

The RBI had told the apex court about the objective of the demonetisation policy to curb black money and fake currency.

Attorney General R Venkataramani had said that the economic policy of demonetisation is linked to a social policy where an attempt is made to remove the three evils.

The top court had on December 7 directed the Center and the Reserve Bank of India (RBI) to place on record the records relating to the government's 2016 decision and reserve its decision.