Challenge to Demonetisation: Supreme Court reserves judgment, asks Central government to submit documents in sealed cover

The Supreme Court on Wednesday reserved its verdict on the batch of pleas challenging the Central government's 2016 exercise of demonetising currency notes of ₹500 and 1,000 [Vivek Narayan Sharma vs Union of India and ors]..A Constitution Bench of Justices S Abdul Nazeer, BR Gavai, AS Bopanna, V Ramasubramanian and BV Nagarathna reserved its judgment in the matter today after hearing rejoinder submissions by the counsel. The Court directed parties to file their written submissions by Saturday, December 10 and asked the Central government to hand over some undisclosed documents relating to the decision, in a sealed cover. .The top court is currently hearing a batch of pleas challenging the move, specifically on eleven questions of law.Over six years after the move, the petitioners raised the following broad grounds of the petitioners:Section 26(2) of the Reserve Bank of India (RBI) Act that allows government to declare all series of a particular denomination as being no longer legal tender is too wide;The decision-making process was deeply flawed;The recommendation did not consider relevant factors;The stated objectives of demonetisation were not achieved;The move fails the test of proportionality;The Court has powers to mould and grant declaratory relief..During today's hearing, Senior Advocate Shyam Divan reiterated that a recommendation of Central Board of the RBI was a necessary requirement before the Central government could have taken the decision for demonetisation.He added that the Union government was duty-bound to honour the promise written in bank notes of paying bearers a sum, in writ and civil courts. On the arguments from the government that the executive route was necessary so as to tackle black money etc, he said,"Parliamentary route always available in exigencies, but 26(2) is purely administrative action that needs the Central Board's recommendation. The government is not helpless during exigencies."Divan also came down on the RBI for providing an exemption from the deadline to exchange notes to NRIs who had taken their money abroad but not those who had kept the notes in India, saying that the same was 'arbitrary and heartless'. When Senior Advocate Jaideep Gupta appearing for the RBI said that Divan's client could have returned in November, Divan responded saying, "That is a callous submission.".Gupta then argued that if every individual were to make specific demands and seek a writ of mandamus, the deadlines would have been meaningless. "The Prime Minster said 50 days, if he had even stated that more time would be granted later, no case is made out that promissory estoppel operates. Beyond that period we did not give any guarantee." Attorney General (AG) for India R Venkataramani stressed that the distinctions made for grace periods for different categories were not arbitrary. On the contention by one of the petitioners that their right to dignity was affected, the AG said,"The dignity aspect should be preserved for more precious cases. An NRI goes abroad for financial benefit, no question of dignity there. Dignity involves privacy etc.".Follow our stories on what transpired at previous hearings, here.