The Supreme Court on Friday pulled up the Centre over demonetisation and asked if it can guarantee a minimum cash withdrawal from banks across the country to every customer affected by the November 8 decision. The top court also asked the government to respond by Wednesday if it could relax the curbs imposed on district cooperative banks after implementing certain conditions.
The Narendra Modi government on November 8 had announced that all the Rs 500 and Rs 1,000 notes stand abolished and that the public had a limited time to deposit the scrapped notes in banks. There were also restrictions imposed on the limit of cash withdrawal for customers from banks and ATMs.
The SC bench led by Chief Justice TS Thakur also asked the government if it had plans in place for demonetisation at all or it just took an impromptu decision of scrapping notes without proper planning. Justice Thakur told attorney-general Mukul Rohtagi: "when you fixed the cap at Rs 24,000 per week on your own, you must have checked if the system can take that burden, haven't you?"
The senior counsel appearing for various petitioners in the top court informed the bench that although the government had said that every account holder could withdraw a sum of Rs 24,000 per week, the banks are giving the customers only Rs 5,000 to Rs 10,000 per week. Considering this, the court asked the government to "see if you can fix a limit below which the bank manager can't send you away or ration currency."
Answering sharp questions posed by the SC, Rohatgi admitted that issues were cropping up now because the Centre's expectation of cash deposit had exceeded and the government had thought that scrapped currency worth Rs 10-11 lakh crore would come back. However the deposits exceeded their estimation.
Responding to Rohatgi's statement, the court asked, ""Can you put what you had estimated when you took the decision to scrap Rs 500 and Rs 1,000 notes? Did you make any estimation at all? Was there a plan? Or, did you take the decision just like that? If you had thought notes worth Rs 10 lakh crore would come back to the banks, did you take steps to urgently put in that much of new currency back in circulation? Can you produce the Cabinet note before the decision was taken?"
The court asked Rohatgi to apprise it of the government's stand on the issues including the bar imposed on district cooperative banks from accepting the scrapped noted. The next hearing by the bench is scheduled for December 14.
