The Reserve Bank of India has been authorised to issue currency notes in India.
People are allowed only to carry the currency notes and use them. However, mutilating/tearing or destroying a banknote is a punishable offence.
If you are found tearing a banknote, you may be charged under the Prevention of Damage to Public Property Act as well as the Indian Penal Code.
You may be booked under the Indian Penal Code Section 489 as well as Section 3 (2-e) of the Prevention of Damage to Public Property Act, 1984 for causing a loss to the public exchequer.
Punishment for tearing a banknote may lead to imprisonment for a term which may extend to five years and with a fine.
However, if you have a torn note or soiled note, you can get it changed from the banks/authorized centres or the RBI office.
All banks are authorized to accept and exchange soiled banknotes for full value. They shall extend the facility of exchange of soiled/mutilated notes to non-customers also.