A five-judge constitution bench headed by Justice S.A. Nazeer and comprising Justices B.R. Gavai, A.S. Bopanna, V. Ramasubramanian, and B.V. Nagarathna pronounced the judgment on a clutch of petitions challenging the Centre’s 2016 decision to demonetise currency notes.
Justice Nagarathna was the only dissenting judge on the bench, raising three major points for her variance with the majority verdict.
‘RBI to initiate process, not Centre’
Justice B V Nagarathna differed with the majority judgment authored by Justice Gavai and said it “missed the main issue.”
“The Reserve Bank of India (RBI) should initiate the demonetisation process and not the Centre. As this was reversed in 2016, the demonetisation decision was legally flawed,” she said.
“The proposal originated from the Central government and the opinion of the RBI was sought. Such an opinion given by the RBI cannot be construed as a “recommendation” under Section 26(2) of the RBI Act,” she added.
‘Parliament not consulted’
Justice Nagarathna also said that the scrapping of Rs 500 and Rs 1000 notes was required to be done through a legislation and not via a gazette notification.
She said this was not a case of a particular series of note by the RBI, but far more serious- as it involved banning all series of the concerned denominations.
“Parliament cannot be left aloof on an issue of such critical importance for the country,” Justice Nagarathna said.
‘Hardship for citizens’
Justice Nagarathna also said that demonetisation resulted in very harsh situations for the citizens. However, she said the demonetisation was well-intended and its object were to combat the depraved practices of black money, terror funding and other such practices.