No Exceptions For Depositing Old Notes: Centre To Chief Justice Of India

One last opportunity to deposit the 500- and 1,000-rupee notes that were banned in November will defeat the whole point of demonetisation as well as the battle against black money, the government told the Supreme Court today.

Earlier this month, the top court had asked the centre to consider a final window to benefit those with a genuine reason for not turning in the outlawed notes by the end of last year, the deadline that was set by the RBI after Prime Minister Narendra Modi's shock announcement on demonetisation.

Different citizens' appeals were clubbed together by the Supreme Court - they included a woman who said she could not make it to a ban because she was delivering a baby and another who said her family was coping with a death in the family.

"If there is a genuine person, he should have the opportunity if he has failed to deposit for a valid reason. You can't take his money away, it is his money," the Chief Justice of India, JS Khehar said at the last hearing on July 5.

But the government complained today of "the gross misuse or abuse" of previous extensions or exceptions that allowed old notes to be used to book railway tickets or at petrol pumps among others. Allowing a new opportunity to deposit the banned notes would result in "any number of benami transactions" and make it difficult for departments to distinguish "genuine cases from bogus ones", the centre warned.

The PM's announcement in November meant that within a few hours, 86 per cent of the cash in circulation was pulled. A shortage of currency forced long lines at banks as people queued up to return old notes or exchange them for the new Rs. 500 and Rs. 2,000 notes that were introduced with high security features.

The PM said the short notice was vital to ensure that black money holders were deprived of the opportunity to launder their money. However, the RBI says it has still not determined the exact figure of the returned notes. By the end of December, banks had received virtually all the currency notes that had been banned - which implied that no black money had been destroyed. Rs. 15.5 lakh crore was the value of the outlawed currency - about Rs. 15 lakh crore was accounted for in deposits by the end of 2016, said several reports.

The last official estimate from the RBI, shared in mid-December, pegged the returned notes at Rs. 12.5 lakh crore.