1. Demonetisation move aims to unearth illegal parallel economy: Centre to Supreme Court

Demonetisation move aims to unearth illegal parallel economy: Centre to Supreme Court

Justifying its November 8 decision to scrap the Rs 500 and Rs 1,000 banknotes, the Centre on Thursday told the Supreme Court that the objective behind the demonetisation move is to unearth an illegal parallel economy, reducing the ratio of cash transactions and increasing digital payments.

By: | New Delhi | Published: November 25, 2016 6:26 AM
Calling the step a move towards digital India, the government said demonetisation was undertaken for increasing digital payments in the economy through credit and debit cards, internet banking, e-wallets and mobile apps. (Reuters) Calling the step a move towards digital India, the government said demonetisation was undertaken for increasing digital payments in the economy through credit and debit cards, internet banking, e-wallets and mobile apps. (Reuters)

Justifying its November 8 decision to scrap the Rs 500 and Rs 1,000 banknotes, the Centre on Thursday told the Supreme Court that the objective behind the demonetisation move is to unearth an illegal parallel economy, reducing the ratio of cash transactions and increasing digital payments. The government further said the move would eventually create more jobs and boost affordable housing.

Demonetisation was also an attempt to unearth black money that has been stashed over the past seven years, the BJP government said, adding that the RBI and the finance ministry are constantly monitoring the position regarding the distribution of all denominations of banknotes.

In an affidavit filed on Thursday, the government said there was a need to maintain utmost secrecy in implementation of the demonetisation scheme in view of the enormity of its impact due to the sudden announcement. Calling the step a move towards digital India, it said demonetisation was undertaken for increasing digital payments in the economy through credit and debit cards, internet banking, e-wallets and mobile apps.

The Centre filed its affidavit on the Supreme Court’s direction. It further said the withdrawal limit across ATMs and banks was being increased from time to time to lessen the inconvenience being faced by the public.

Attorney general (AG) Mukul Rohatgi had on Wednesday told the court that the situation following the November 8 move was improving and the Centre was monitoring the situation on a daily basis.

The Centre also informed the court about the steps taken to ease the pain of the people in the aftermath of the decision. All steps were being taken to ensure that the transition was a smooth one and recalibration of ATMs is on in full swing, it said, adding that any difficulty being faced by the people would be sorted out.

The apex court is likely to hear the matter on Friday.

The government had moved the apex court on Monday seeking to transfer all pending cases against demonetisation to a single high court or to the top court as proceedings in various courts were creating difficulties. The PILs have challenged the move on various grounds, including the decision being illegal and the limits on cash withdrawals being unreasonable.

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