Government, RBI circulars inconsistent: Bombay High Court
The court also directed the RBI to file its reply to the petition.
Mumbai: The Bombay high court on Monday, while hearing a petition, observed that there are inconsistencies in a Central government circular regarding demonetisation and a Reserve Bank of India’s (RBI) circular, which was issued on November 14. The court also directed the RBI to file its reply to the petition on Tuesday.
A division bench of Justice Abhay Oka and Justice M.S. Karnik was hearing a written petition filed by the Mumbai District Central Co-operative Bank challenging the RBI’s November 14 circular, which prohibits district co-operative banks from receiving and exchanging defunct Rs 1,000 and Rs 500 notes from their account holders.
The petition stated that the banks have lakhs of account holders and many organisations such as hospitals, schools and colleges are facing difficulties.
Additional solicitor general Anil Singh told to the court that last week the attorney general had moved a transfer petition before the Supreme Court saying all the petitions regarding demonetisation should be heard by the apex court or any high court of the country.
Senior counsel Janak Dwarkadas, who appeared for the Mumbai District Central Co-operative Bank, argued that the Supreme Court had, last Friday, ordered that all respective high courts can hear such petitions at their level. He further said that he was not challenging the demonetisation decision taken by the government but the RBI’s circular.
After hearing this, the court asked the central government to bring a copy of the petition it had filed before the Supreme Court.
Meanwhile, V.M. Thorat who appeared for Solapur District Central Co-operative Bank argued, “We have 50 lakh account holders. Everyday people are coming to deposit cheques and we have cleared them through the State Bank of India. But now because of the RBI circular, the state bank is refusing to clear our cheques or take the old notes.”