Supreme Court refuses to stay demonetisation

​New Delhi: The Narendra Modi government on Tuesday surpassed a major legal hurdle after the Supreme Court refused to stay its notification demonetising Rs 500 and Rs 1,000-currency notes but told it to reduce the inconvenience of the people, saying "you cannot have surgical strike" against them.

"You (Centre) can have a surgical strike against black money but you cannot have surgical strike against the people of the country," a bench comprising Chief Justice T S Thakur and Justice D Y Chandrachud said, pointing to the long queues at banks and ATMs.

"Carpenters, maids, vegetable sellers are dependent on cash. Are you capable of reducing their trauma? Your aim is to wipe out black money but people are traumatised standing in queues for hours doing nothing," the bench said.

"They (Centre) call it surgical strike. You (Kapil Sibal appearing for a petitioner) call it carpet bombing. The object of such measures is against the people hoarding cash," it said.

While observing that fighting the black money menace was a "laudable" step, it asked the Centre to "consider taking steps to ease the pain of the common people" and also consider raising the limit of cash withdrawals.

"Why can't it be raised to a reasonable level so that there is less number of people standing in the queue," the bench said, adding that the inconvenience part has to be looked into.

The government told the apex court that the situation was being constantly monitored at the highest level and just now, it has been decided that the banks would allow from Tuesday the withdrawal of Rs 50,000 per current account per week and the facilities would also be available to companies.

Makings it clear that he was not seeking stay of the government decision to demonetise, Sibal said, "We are with the government in curbing the black money, but the inconvenience it is causing to the public is not reasonable. It is jeopardising their life."

The apex court did not issue notices to the Centre or the RBI and asked them to file a comprehensive affidavit detailing steps taken so far and other proposed measures to ameliorate the harassment and inconvenience caused to citizens due to demonetisation of the high value currency notes.

The government, represented by Attorney General Mukul Rohatgi, came fully prepared to defend its ambitious step aimed at curbing black money and counterfeit currency used in financing terror and extremist violence saying the target was to "catch the big fish" which the previous governments could not do in last 50 years.

Defending the government decision as being in conformity with the legal provisions, Attorney General Mukul Rohatgi admitted that a government decision of such magnitude would cause some pain and urged the court not to interfere as "these are the matters of economic policy".