These two currency were issued by the Reserve Bank of India recently after old Rs. 500 and Rs. 1,000 notes were withdrawn.
NRB has called the new notes “unauthorised and illegal”.
NRB spokesperson Narayan Poudel said these new notes were not yet legal in Nepal, according to Onlinekhabar.com.
Mr. Poudel said these notes would be legal in Nepal only when India issued a notification as per the Foreign Exchange Management Act.
India is likely to issue a FEMA notification, allowing people in Nepal and India to possess certain amount of Indian currency.
Earlier, a ban was in effect in Nepal till 2015 against the use of Rs. 500 and Rs. 1,000 notes.
The authorities had lifted this ban after the visit of Prime Minister Narendra Modi to Nepal.
In 2015, Nepal allowed people to carry Indian Rupees of higher denominations up to Indian Rs. 25,000.
The RBI had formed a task force to ease currency exchange facility in Nepal for non-Indians who possess the now-defunct notes of Rs. 500 and Rs. 1,000.