SC note ban verdict: Important quotes from apex court on demonetisation

PTI

New Delhi, January 2

More than six years after the Centre's decision to demonetise the Rs 1,000 and Rs 500 denomination notes, the Supreme Court in a 4:1 majority verdict on Monday upheld the 2016 move, saying the decision-making process was not flawed merely because the procedure emanated from the government.

Following are the important quotes from the Supreme Court judgment:

* Impugned notification dated November 8, 2016 does not suffer from any flaws in the decision-making process.

* Notification dated 8th November 2016 satisfies the test of proportionality and, as such, cannot be struck down on the said ground.

* Scope of judicial review in matters of economic policy is narrower and there has to be great restraint in matters of economic policy.

* The period provided for the exchange of notes vide the impugned notification dated 8th November 2016 cannot be said to be unreasonable.

* Demonetisation decision had a reasonable nexus with its objectives, such as eradicating black money, terror funding etc., and it is not relevant whether those objectives were achieved or not.

* Power available to the Central Government under Section 26 (2) of the RBI Act cannot be restricted to mean that it can be exercised only for ‘one' or 'some' series of bank notes and can be exercised for all series of bank notes.

* RBI does not possess independent power under sub-section (2) of Section 4 of the 2017 Act in isolation of the provisions of Sections 3 and 4(1) to accept the demonetised notes beyond the period specified.

* Justice B V Nagarathna, in her dissenting verdict, said the action of demonetisation of currency notes was "vitiated" and the notification issued in this regard in November 2016 was "unlawful".

* Parliament cannot be "left aloof" in a matter of such importance and its views on the subject of demonetisation were critical and of utmost importance: Justice Nagarathna.

* No independent application of mind by the RBI as the entire exercise of demonetisation of all series of bank notes was carried out in twenty-four hours: Justice Nagarathna.

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