The Delhi High Court today agreed to hear a plea against demonetisation, saying once the currency was invalidated then how could the government direct certain public utilities including hospitals and petrol pumps to accept old notes.
A bench of Justices B D Ahmed and Jayant Nath listed for hearing tomorrow the plea which also sought discontinuation of the new Rs 2,000 currency note, terming the move as “unconstitutional and bad in law".
Petitioner Pooja Mahajan, running a designer showroom, mentioned the matter pleading urgency on the ground that she is being deprived of earning her livelihood and her fundamental rights are being infringed.
She also blamed the government for taking a dual stand saying on one hand it was encouraging people to deposit old notes in bank accounts and on the other hand threatening them of prosecution for depositing over Rs 2.50 lakh.
Advocates, A Maitri and Radhika Chandrashekhar, counsel for the petitioner, urged the court to quash various notifications with regard to demonetisation issued on and after November 8, saying they are in contravention of the Constitution of India and Reserve Bank of India (RBI) Act.
Section 24 of RBI Act deals with denomination of notes which empowers the RBI and Centre to issue bank notes for various denominations as mentioned in section 24 (1) and (2) of the Act, the plea said.
“Till date, the government has not issued any notification under Section 24 (2) of the RBI Act for discontinuing currency notes of Rs 500 and Rs 1,000.
It further said that Rs 2,000 notes are being circulated by the Government against mandate of section 24(1) of the Act.
Seeking direction to Ministry of Finance, the petitioner said the government’s decision is “arbitrary and unconstitutional” as on one hand it has cancelled the currency notes of Rs 500 and Rs 1,000 but simultaneously circulated high denomination notes of Rs 2,000 without the mandate of the RBI Act.
The petitioner also alleged that “on the pretext of exchange of notes, the Government cannot prosecute and misuse the provisions of Income Tax Act by treating the cash deposit for exchange as unaccounted money".