The Supreme Court has fixed the hearing on a batch of pleas challenging demonetisation for 2 December, saying it will examine both the inconvenience aspect and constitutional validity of the 8 November notification in one go.
A bench of Chief Justice TS Thakur and Justice DY Chandrachud initially said it would first hold a hearing on the inconvenience faced by the public and steps taken to address them and that the hearing on the validity of the note ban could take place later. But the apex court later agreed to hold hearing on both the aspects simultaneously.
The Centre, represented by Attorney General Mukul Rohatgi, had requested a stay on the proceedings against its 8 November decision to demonetise high denomination currency notes of Rs 500 and Rs 1,000, before various high courts and other courts apart from the apex court, saying it will create a lot of confusion. The Supreme Court agreed to hear the plea on 17 November, after initially refusing to stay the government's demonetisation notification on 15 November.
The apex court had on 18 November dubbed as a "serious issue" the long queues outside banks and post offices and expressed its reservation on the Centre's plea, even warning the Centre of the possibility of riots, according to a Hindustan Times report.
However, the Supreme Court on Wednesday, 23 November, sought the response of all the petitioners, who challenged the demonetisation move in different high courts and a three-judge bench headed by Chief Justice TS Thakur refused the Centre's request to stay the proceedings, saying people may get "immediate relief" from them.
"We don't want to stay it. There are various issues. People may get immediate relief from the high courts," the bench also comprising Justices DY Chandrachud and L Nageswara Rao told Attorney General Mukul Rohatgi.
The AG on Thursday informed the bench that the situation is "much better" and more than Rs 6 lakh crore has been deposited so far in the banks since the demonetisation move, and that there is a big surge in digital use of money transaction.
He had also said the demonetisation move was aimed at removing the 70 years of "slush money" and the government is monitoring the situation day-by-day and hour-by-hour.
And that the government has set up a committee which will take stock of the ground situation across the country on demonetisation move, after saying that the general rule is that the cash transactions in the market should not be more than four percent of the GDP but it is 12 percent in India.
The bench had questioned the relief measures undertaken by the Centre and asked why it had squeezed the exchange limit to Rs 2,000, to which the AG said that after printing, the currency has to be moved to thousands of centres across the country and ATMs have to be re-calibrated to issue new currency notes of Rs 500 and Rs 2,000 adding that Rs 100 notes are in circulation.
A day before this crucial hearing, the Centre, had filed an affidavit on demonetisation, and said the decision on which a total secrecy was maintained, would now help in proper implementation of the ambitious 'Jan Dhan Yojana' under which around 22 crore bank accounts for poor people have been opened as reports of unscrupulous elements using these accounts to convert their black money into white surfaced.
Further, demonetisation is seen as a check on the real estate sector where prices get pushed up artificially, reducing the availability of affordable housing for the poor and the middle class. Elaborating on several measures including the "thrust" given for increasing digital payments in the economy through credit and debit cards, internet banking, mobile apps and e-wallets, it said their use has seen a jump of nearly 300 percent in the last 10 days.
In its affidavit, the Centre also gave reasons for maintaining secrecy about the move which was announced by Prime Minister Narendra Modi just after 8 pm on 8 November and came into force from the midnight, saying "If elaborate prior arrangement for distribution of new currency notes were made prior to the announcement of the scheme, the very objective of the scheme would have been defeated. Further, the scheme impacts several sectors in the short-term but promises large benefits in the economy in the medium-term."
Petitions have been filed by a number of people including Sitaram Yechury of the CPI-M, seeking to know what the government was doing to ensure that there was adequate supply of currency notes according to a News 18 report.
The bench, meanwhile, asked Attorney General Mukul Rohatgi, appearing for the Centre, to file additional affidavit, if any, explaining the "schemes and steps" taken to ease the situation that has arisen due to demonetisation.
Senior advocate Kapil Sibal, appearing for one of the petitioners who has challenged the Centre's 8 November decision on demonetisation, said the court should start hearing the matter from Tuesday itself. Rohatgi, however, opposed the contention and said let all the petitioners, who have approached various high courts on the issue, come to the apex court which would take a call on 2 December as to whether the Supreme Court or the Delhi High Court would hear them all.
With inputs from agencies