Demonetisation was the legal act of banning the currently flowing dominations from the economy. It has taken place on 8th November, 2016 at 20:15 IST through televised announcement by Prime Minister Narendra Modi. It was implemented with the motive to curb black money flow in the system.
Demonetisation still has been a recurring debate in India till date and with the beginning of new year, on Monday, Supreme court has announced its order on the long going argument of demonetisation. The bench of five judges headed by Justice S A Nazeer, besides Justices Nazeer, Gavai and Nagarathna with other members including the five-judge bench are Justices A S Bopanna and V Ramasubramanian.
Petitioners argued on removing of the ban of 500 and 1000 rupee notes from the economy, stating that it does not worked out in the way the government wanted pointing the ban has caused a ruckus in the economy. Leads to creating problem for the general public with the limited time period given to them to get the cash deposited in banks, the long never ending queues outside the ATM's with insufficient money available to withdraw. A count of 58 petitions, including senior advocates P Chidambaram and Shyam Divan. Calling the act of demonetisation, a failed attempt, which a government cannot take it self and propose the tender arguing that these actions need special recommendations from the RBI Central board.
Government stated that with the ban of bigger dominations from the economy it will help in boosting the digital transactions with leads to more white money flow, eradicate terror funding’s, corruptions and all illegal activities which is bringing more black money in the economy. Government justified its actions by concluding the ban as a step towards more open ended economy which will help in the boost of nation.
Supreme Court has ordered the Centre and RBI to provide with the relevant records and statements to solidate their actions and statements. Court has asked for the 2016's government and RBI records which makes them to take this decision and support their actions. Court has heard arguments from RBI counsel, Attorney General R Venkataramani. senior advocates and petitioner lawyers.
RBI counsel considered the demonetisation as a commendable measure, and will only create a short-term negative impact on country's GDP, as per the minutes of meeting. The board also said that the economy growth rate is real and currency growth is also normal which contradicts the idea of demonetisation.
Court with a ratio of 4:1, majority upheld the government’s 2016 demonetisation as lawful act without any flaw. Minority verdict, Justice Nagarathna stated governments decision as flawed and said that these decisions cannot be taken through gazette notification and can only be taken through a set legislation pattern. She was also the junior most judge in the bench, said that the entire process has taken placed within the duration of 24 hours.
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