LexVIVEK NARAYAN SHARMA versus UNION OF INDIA
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
[2016] 7 S.C.R. 798 A VIVEK NARAYAN SHARMA v. UNION OF INDIA (Writ Petition (Civil) No. 906of2016) B DECEMBER 16, 2016 c D E F G H [T.S. THAKUR, CJI, A.M. KHANWILKAR AND DR. D.Y. CHANDRACHUD, JJ.) Demonetization: Reserve Bank of India Act, 1934 - ss. 26(2), 7, 17, 23, 24, 29 and 42 - Notification dated November 08, 2016 whereby old currency notes of Rs. 500 and Rs. 1000 demonetized - Vires of Notification - Nine questions framed - In view of general public importance and far reaching implications, matters referred to Five Judge Bench. Bar on District Cooperative Banks to accept deposits or exchange of demonetized currency of Rs.500/- and Rs. I 0001- - Challenge to - Held: Decision is the outcome of financial policy, adopted on the basis of experience - There is apprehension that the possibility of demonetized notes being converted or exchanged without proper audit, control or supervision - Furthe1; the District Cooperative Banks not directly under the control of the Reserve Bank of India but within the purview of NABARD - Dispensation provided by NABARD not in conformity with the strict regime provided under the provisions of Banking Regulation Act, 1949 and Reserve Bank of India Act, 1934 - Thus, no inclination to suspend the bar as an interim measure - Banking Regulation Act, 1949 - Reserve Bank of India Act, 1934. District Cooperative Banks precluded from utilizing the demonetized notes deposited with them between lJ th to 14th November 2016, when it was so permitted by RBI - Challenge to - Held: Instructions of Under Secretary to Government of India that RBI has recommended that the Specified Bank Notes (SBNs) collected by the DCCBs between !0th and 14th November 2016 may be exchanged after audit of the veracity of the KYC documents by NABARD - Issuance of suitable Notification by the Competent 798 VIVEK NARAYAN SHARMA v. UNION OF INDIA Authority within two days - Policy of replacement of legal tender notes as applicable to Public Sector Banks and other Banks would be applied even in the case of District Cooperative Banks for exchange of demonetized currency. Extension of time limit for exemption for use of demonetized currency notes of Rs.5001- and Rs.1000/- -Held: Whether exemption period should be extended or not must be best left to the judgment of the Government - No interim direction can be issued to the Government in the said matter - Government can take appropriate decision. Denial of right to withdraw the prescribed amount of Rs.2.J,0001- per week per account holder, in spite of Notification issued by Reserve Bank of India permitting such withdrdwal - Non- availability of enough volume of legal tender currency - Held: As per Attorney General, the Government has already made it amply clear that it would take around 50 days time to streamline the cash flow and the period is still not exhausted - Authorities are working to the best of their ability to defuse the crisis of cash flow situation by printing new notes - To maintain complete secrecy to unearth the black money, new currency notes could not be printed well in advance - Authorities to fulfill their commitment made in terms of the Notification permitting withdrawal to the extent possible and review the decision periodically and take necessary corrective measures. Transfer Petitions: Transfer Petitions by Union of India for withdrawing all writ petitions/proceedings pending in the various High Courts and to hear those cases along with the writ petitions pending in this Court - Held: Such withdrawal would be just and proper, to avoid multiplicity of hearing and conflicting decisions on the same subject matter - Issuance of notice in the respective Transfer Petitions and stay of the further proceedings of the writ petitions/proceedings in the concerned High Court as also pending in any High Court - No other court to entertain, hear or decide any writ petition/proceedings on the issue of demonetization of the old notes. CIVIL I CRIMINAL ORIGINAL I APPELLATE JURISDICTION: Writ Petition No. 906 of20l6. 799 A B c D E F G H 800 A B c D E F G H SUPREME COURT REPORTS [2016] 7 S.C.R. Under Article 32 of the Constitution of India. WITH W. P. (C) No. 908/2016, W. P. (C) No. 913/2016, W. P. (C) No. 91612016, W. P. (C) D. 37946/2016, W. P. (C) No. 92912016, W. P. (C) No. 93012016, W. P. (C) No. 943/2016, W. P. (Cr!.) No. 162/2016, W. P. (C) No.951/2016, W.
Excerpt shown. Read the full judgment & AI analysis in Lexace.