New Delhi: Justifying its decision to demonetise Rs 500 and 1,000 currency notes in 2016, the Centre has said that it was aimed at fighting the menace of fake currency notes, terror financing, black money and tax evasion.
The Centre, in its 16-page affidavit filed in the Supreme Court, said that it was a part of a larger strategy for combating the menace of fake money, terror financing, black money and tax evasion, but not confined to them alone.
The affidavit was filed by the Centre, which opposed the batch of pleas challenging the Centre’s November 8, 2016 decision. The matter is being heard by the Constitution Bench of the Supreme Court at present.
The Centre filed this affidavit, after complying with the Apex Court’s order asking it to file the written affidavit in the case.
The Centre told the Supreme Court that the nation underwent an important transformation through a series of economic policies and events, and withdrawal of the legal tender character was one important action in that series.
It said notification withdrew the legal tender character of the specified banknotes (SBN), which is generally called as “demonetisation”.”The notification issued on 08.11.2016 was a major step to fight the menace of fake currency notes, storage of unaccounted wealth and financing of subversive activities,” the government said.
Justifying its decision, the government also said, “The expansion of the formal sector and the shrinking of the informal sector were undertaken through a series of policy measures. The policy push included digitalising transactions, technology connectivity and implementation to enable last-mile reach, increasing the tax base, enhancing tax compliance, lowering the cost of doing business, eliminating policy distortions, facilitating financial inclusion at the formal sector level and labour and agrarian reforms.”
The Constitution Bench of the Supreme Court would hear the matter now next on November 24, to the pleas challenging the Centre’s decision to demonetize currency notes of Rs. 500 and 1,000 in 2016 and said that they want to conclude the hearing on this issue this year.
Various petitions were filed arising from the decision of the Government of India todemonetize the old notes of Rs.500/- and Rs.1000. One of the petitions was filed by lawyer, Vivek Narayan Sharma. The petition has challenged the notification dated 8th November 2016.