SC refuses to stay demonetisation notification, asks how Govt intends to deal with cash chaos

Supreme Court on Tuesday refused to stay government's demonetisation scheme.

New Delhi: The Supreme Court on Tuesday refused to stay Narendra Modi government's demonetisation drive, but at the same time asked the Centre to explain steps it has taken or will take to deal with the chaos outside banks and ATMs.

A bench comprising Chief Justice TS Thakur and Justice DY Chandrachud further asked the government to file an affidavit regarding the steps it was exploring and considering in relation to an inconvenience caused to people due to the cash crunch.

"We will not be granting any stay," a bench comprising Chief Justice T S Thakur and D Y Chandrachud said.

A batch of PILs were filed in the top court seeking quashing of the government's decision to demonetise Rs 1,000 and Rs 500 currency notes.

Senior advocate Kapil Sibal, appearing for one of the petitioners, however, said he was not asking for a stay on the notification but seeking answers from the government about the steps taken to remove public inconvenience.

As senior counsel Kapil Sibal, appearing for the petitioner, described demonetisation as a "surgical strike against the common man", Chief Justice Thakur observed "What Attorney General says is a surgical strike, what you say is a carpet bombing".

The apex court has set the next date of hearing on November 25.

Defending the government decision as being in conformity with the legal provisions, Attorney General Mukul Rohatgi admitted that a government decision of such magnitude would cause some pain and urged the court not to interfere as "These are the matters of economic policy".

At this, Chief Justice Thakur observed "We are not interfering in your policy matters."

Rohtagi He also said there were as many as 24 crore bank accounts including 22 crore opened under the 'Jan Dhan Scheme' and the Centre was hopeful to "ramp up" the outflow of the cash to banks, post offices and two lakh ATMs across the country.

"Two lakh ATM machines could not have been deliberated in advance to be in tune with new notes as the cash would have been out of the banks," Rohatgi said, adding that "secrecy is the key to such actions".

"The attack is on those who have stashed huge amount of currency," he said, adding that the surgical strike of this nature has to be carried out in complete secrecy and it was not possible to come out with Rs 10 lakh crore of currency in one go as there was a need for recalibration of ATM machines across the country.

The SC's decision comes as there was no let-up in the rush for withdrawing money and exchanging demonetised notes across the country, as serpentine queues in front of banks and ATMs were a common sight even on Tuesday.

Prime Minister Narendra Modi last week announced that Rs 500 and Rs 1000 will no longer be legal tender from November 08, 2016 midnight.

The pleas seek quashing of the government's decision on the grounds that it infringed citizens' right to life and trade among others.

Out of the four, two PILs have been filed by Delhi-based lawyers Vivek Narayan Sharma and Sangam Lal Pandey respectively. Two other pleas have been filed by individuals, S Muthukumar and Adil Alvi, on the demonetisation issue.

Meanwhile, Opposition political parties including, Congress, Aam Aadmi Party, Samajwadi Party, Bahujna Samaj Party, Rashtriya Janata Dal and many others have asked the government to reverse back its order.

At the moment, the daily withdrawal limit from ATMs is Rs 2,500, and exchange of old notes from bank counters is Rs 4,500. This apart, the upper limit for weekly withdrawal from bank accounts stands at Rs 24,000.

With reports of Jan-Dhan accounts being used by other people to deposit their unaccounted cash, the Finance Ministry today set an upper limit of Rs 50,000 for deposits into these accounts.