The Delhi High Court on Monday refused to interfere in the matter of exchanging ₹2,000 note without any identity proof. It also observed that decision to dispense with ₹2,000 note is not a decision towards demonetisation
Giving its ruling on a Public Interest Litigation (PIL), a Division Bench of Court comprising Chief Justice Satish Chandra Sharma and Subramonium Prasad said that in order to facilitate the exchange of ₹2,000 denomination banknotes with other denomination banknotes, the government has given a window of four months to the citizens and in order to avoid inconvenience to citizens, the government is not insisting on providing any kind of identification.
“As this is purely a policy decision, courts should not sit as an Appellate Authority over the decision taken by the government,” the Bench said while dismissing the petition filed by lawyer Ashwini Kumar Upadhyay.
The petitioner submitted that that out of total denomination of ₹2,000 banknotes, at present ₹3.62- lakh crore banknotes are in circulation and are not being commonly used for transactions. He, therefore, argued that these notes are primarily black money.
‘Encouraging money laundering’
By not insisting on any form of identification at the time of exchange of banknotes to other denomination banknotes, the government is actually encouraging persons indulged in Benami transactions, money laundering, drug trafficking etc. Therefore, this decision of the government has to be struck down by the Court, he pleaded.
The court observed that the decision taken by the government in relation to the economic policies is not ordinarily interfered with, by the Courts, unless the decision of the government is manifestly arbitrary
According to the Bench, the decision of the government is only to withdraw ₹2,000 denomination banknotes from circulation as issuing these denominations has achieved its purpose which was to meet the currency requirement of the economy in an expeditious manner as in November, 2016, when all ₹500 and ₹,1000 denomination banknotes were declared to be not legal tender. In order to meet the situation at that point of time, the government took a decision to bring banknotes of ₹2,000 denomination to ensure adequate supply of money to meet the day-to-day requirements of the people.
Legal tender
Six years after the decision, the government has now decided to withdraw ₹2,000 denomination banknotes from circulation which is not being used commonly. Banknotes of ₹2,000 shall continue to be a legal tender and this policy is only for exchange of banknotes having denomination of ₹2,000 with other banknotes, the bench said.
Post withdrawal of ₹2,000 banknotes from the circulation, the Reserve Bank of India has permitted exchange of 10 notes at a time in bank branches or at its 19 regional offices between May 23 and September 30. Now, most of the public sector banks are not insisting upon identity proof for exchange, while most of the private sector banks do ask for these proofs.