“Cash Crunch Could Lead to Riots”: SC Slams Govt Over Currency Ban

People scuffle with a policeman as they try to enter a bank to exchange their old high denomination banknotes in Ahmedabad. (Photo: Reuters)

The Supreme Court slammed the government’s decision to implement demonetisation of Rs 500 and Rs 1,000 notes, calling it a "serious issue" that could lead to riots.

The apex court also refused to stay ongoing hearings of petitions filed in other courts challenging the currency ban.

The Centre has moved the apex court seeking a stay on the hearings of the petitions against the demonetisation issue in all courts except the SC, arguing that it will create a lot of confusion.

"It is a serious issue which requires consideration," a bench comprising Chief Justice T S Thakur and Justice A R Dave said on the note ban issue, while asking the parties to be ready with data and other issues in writing. The bench said:

Some measures are required. See the kind of problems people are facing. People have to go to the high court. If we stop them from going to the high court, how can we know the magnitude of the problem? People going to different courts indicates the magnitude of the problem.

“People Have the Right to Approach Courts”

The court made these remarks after Attorney General (AG) Mukul Rohatgi said that all petitions challenging demonetisation be heard only by the apex court.

Refusing to do so, the court observed: “People are affected. People are frantic. People have the right to approach the courts.” Noting that there are difficulties, the bench asked the Centre, “Can you dispute (this)?”

Agreeing there’s no disputing this fact, the AG however said the queues are getting shorter and even suggested that the CJI can go out during lunch and himself look at the queues.

“Kindly go in the lunch time,” the AG told the bench and took objection to senior advocate Kapil Sibal, appearing for a private party, for allegedly exaggerating the situation. Rohatgi claimed that “it’s a political attempt in the court”. “You are not appearing for a political party, but for an advocate. You are turning the apex court into a political platform,” he added.

At the outset, the bench questioned the relief measures undertaken by the Centre. "Last time you said there will be relief for people in the coming days but you have squeezed the exchange limit to Rs 2,000 only. What is the difficulty?" the bench asked Rohatgi.

Rohatgi explained that after printing, the currency has to be moved to thousands of centres across the country and ATMs have to be re-calibrated. "There is no shortage of funds," he said

He also elaborated on the steps taken by the government to meet the situation by stating that farmers have been allowed to withdraw Rs 50,000 and people having weddings at home can withdraw Rs 2.5 lakh.

At this point, Sibal interrupted and said the problem is of printing as the government needs to print notes worth Rs 23 lakh crore, but the mints do not have the capacity for that.

Already, they have frozen Rs 14,000 crore and it is not clear under which law they have done so. They are trustees, how can they not let us withdraw our legitimate money. The situation has turned from bad to worse.

Sibal said that the government was not concerned about people living in remote areas of the north-east, Himachal Pradesh and the Naxal-hit district of Bastar, who have to walk for 20 km to reach an ATM.

The matter will be heard again on 25 November.

(With inputs from PTI)