The most important financial institution in India, the State Bank of India (SBI), has so far gotten more than Rs 17,000 crore in value in exchange for the Rs 2000 notes taken out of circulation this month. Dinesh Kumar Khara, the chairman of SBI, said that the bank had received deposits of around Rs 14,000 crore in Rs 2,000 notes, while about Rs 3,000 crore was exchanged. Read on to know more!
Drawing Out 2000 Rupee Notes
Announcing the removal of Rs. 2,000 banknotes from circulation on May 19, the RBI made it clear that, unlike with demonetization, the notes will nonetheless continue to be valid forms of payment.
However, the RBI has urged people to deposit or exchange their Rs 2,000 notes at banks until September 30. Even though the government and the RBI claim that removing the Rs 2,000 notes from circulation will be easy and have no negative economic effects, many people disagree.
Delhi High Court PIL
The RBI’s judgment was challenged in a Public Interest Litigation (PIL) filed in the Delhi High Court. The PIL claimed that the RBI lacked the independent power required by the RBI Act to decide this.
According to Rajneesh Bhaskar Gupta’s PIL, section 24 (2) of the RBI Act of 1934 gives the Central government the only authority to order any denomination’s non-issuance or discontinuation of banknotes. It denies the RBI any autonomous authority to do so.
Senior advocate Sandeep P. Agarwal, representing the petitioner, stated that he is interested in learning how the RBI concluded that the in-question notes have a set lifespan.
“The RBI’s power is restricted only to issue and re-issue banknotes under sections 22 and 27 of the RBI Act, but the period for issuing such notes is fixed by the Central government.”
The petition has contended that withdrawing the banknotes after 4-5 years, with a specific deadline, is deemed “unjust, arbitrary, and contrary to public policy.”
Senior advocate Parag P Tripathi, who is defending the RBI, has previously dismissed another PIL on the same circular or announcement. In accordance with the Supreme Court’s judgment, a court cannot have several PILs on the same topic.
SC Denies Another PIL
On Monday, the high court rejected a petition by petitioner lawyer Ashiwini Upadhyay contesting notifications from the Reserve Bank of India (RBI) and State Bank of India (SBI) allowing the exchange of withdrawn Rs 2000 notes without a valid form of identification.
The court had rejected the argument, noting that the decision to stop issuing banknotes with a value of Rs 2000 did not signal the beginning of demonetization.
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