Defending the move, the government has stated that the move formed part of the Centre’s efforts to reduce tax evasion, combat black/fake money and boost digital payment. Around 60 petitions challenging demonetisation, is being considered by the bench
The central government has defended its November 2016 decision where it demonetised Rs 500 and Rs 1,000 currency notes. Demonetisation was a ‘well-considered decision’ and ‘part of a drive to eradicate black money’, said the government in its affidavit addressing the Supreme Court.
Reportedly, affidavit submitted said that it came following the recommendation of the Reserve Bank of India and hence advance preparations were made.
Defending the move, the government has stated that the move formed part of the Centre’s efforts to reduce tax evasion, combat black/fake money and boost digital payment. It was an economic policy decision, the affidavit added.
The overall impact of the move on economic growth was transient along with real growth rate being 8.2 per cent in FY16-17 and 6.8 per cent in FY 17-18. Both reflected more than the decadal growth rate of 6.6 per cent during the pre-pandemic years, said the government further.
The Centre along with the Reserve Bank of India were directed by the Supreme Court on 12 October, to file comprehensive affidavits.
A Constitution bench comprising justices S Abdul Nazeer, BR Gavai, AS Bopanna, V Ramasubramanian and BV Nagarathna also asked the Centre to keep ready files relating to the Centre’s letter to RBI dated 7 November 2016, the decision which RBI board took the next day and the immediate announcement of demonetisation.
Around 60 petitions challenging demonetisation, is being considered by the bench. The apex court in October had verbally highlighted that it was its duty to answer the issue one way or the other for “posterity”.
The Supreme Court expressing its displeasure during the last hearing on 9 November over an adjournment sought by the Centre after the Constitution bench had assembled to adjudicate a clutch of pleas challenging demonetisation. The matter is scheduled to be resume hearing on 24 and 25 November.