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RBI defends before Delhi HC ₹2,000 banknote exchange exercise

The Reserve Bank of India (RBI) on Tuesday told the Delhi High Court that withdrawal of ₹2,000 notes is not demonetisation but a statutory exercise, and the decision to enable their exchange was taken for operational convenience.

The court was hearing a plea by lawyer Ashwini Kumar Upadhyay that the notifications by the RBI and SBI enabling exchange of ₹2,000 banknotes without proof were arbitrary and against the laws enacted to curb corruption.

A bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad said it will pass an appropriate order on the public interest litigation by the lawyer.  

“We will look into it. We will pass an appropriate order,” said the court.

Mr. Upadhyay clarified that he was not challenging the decision to withdraw ₹2,000 banknote but assailed the exchange of the currency without any slip or identity proof. He asserted that the exchange of ₹2,000 banknote should be allowed through deposit in bank account.  

“Why is ID proof excluded? Every poor has a Jan Dhan account. BPL persons are also connected to bank accounts,” Mr. Upadhyay said while claiming that the present arrangement would only enable mafias and gangsters like “Atiq Ahmed’s henchmen” as well as Naxals.

Senior advocate Parag P. Tripathi, for the RBI, emphasised that the court cannot interfere in such matters and the decision was taken to allow exchange of the ₹2,000 currency note for operational convenience.  

“This is not demonetisation. ₹2,000 banknote was not commonly used. Other denominations continue to meet currency requirements,” he said.

“This is a statutory exercise. None of the points claimed by the petitioner impinge or deal with constitutional issues,” Mr. Tripathi added.

“Arguments heard. Judgement reserved,” the court said after hearing the parties.