Millennium Post

SC rejects bank's plea for exchange of `371 crore deposited old notes

The Supreme Court on Monday dismissed the plea of Nashik District Central Cooperative Bank Ltd seeking quashing of the RBI letter barring it from exchanging Rs 371 crore it had deposited in demonetised currency.

A bench headed by Chief Justice J S Khehar dismissed the plea of the bank which said that barring of the exchange before March 31 will lead to closure of 281 branches in Nashik district.

"We have to shut down if we do not have liquidity ratio as was mandated by the Reserve Bank of India. To maintain the ratio, Rs 371 crore need to be exchanged with the central bank," senior advocate Rajeev Dhavan, appearing for the cooperative bank, said.

He said that the RBI letter which barred the bank from exchanging the demonetised currency deposited with it by customers between November 8 and November 14, 2016, should be quashed.

Dhavan said that NABARD has inspected the details of the bank deposits and to have certain liquidity ratio, the amount of demonetised currency needs to be exachanged with the RBI.

"The closure of branches of the bank will lead to serious issues as it deals mostly with agriculture loans given to farmers," he said.

Meanwhile, in another case, the apex court has also rejected the petition filed by a firm Ranu Enterprises Ltd which has been declared as a non-performing asset (NPA) to deposit Rs 10 crore in demonetised currency.

The company had sought a direction for the RBI to permit deposit of money in old currency notes. "We find no ground to entertain the instant petition under Article 32 of the Constitution of India. The writ petition is accordingly dismissed," the bench said while also disposing of the pending interim applications of the company.
Next Story
Share it