Express News Service
NEW DELHI: In her lone dissenting opinion, Justice B V Nagarathna on Monday discovered the Centre’s notification on demonetisation illegal and vitiated because it had procedural flaws. Section 26(2) of the RBI Act, she stated, is just relevant when the proposal for demonetisation is initiated by the Central Board of the RBI. Since the 2026 proposal was initiated by the Centre, she stated it couldn’t be given impact by means of a notification, including the complete course of was completed in 24 hours.
The Centre, she added, can situation a notification if it accepts the advice by the RBI’s Central Board. But within the absence of a advice by the Central Board, demonetisation may be carried out solely by enacting a plenary laws or regulation.
“The powers of the Central Government being vast, the same have to be exercised only through a plenary legislation or a legislative process rather than by an executive act by the issuance of a notification in the Gazette of India. It is necessary that the Parliament which consists of the representatives of the People of this country, discusses the matter and thereafter approves and supports the implementation of the scheme of demonetisation,” she stated.
Terming the decision-making course of as tainted with non-exercise of discretion by the RBI’s Central Board, she stated the RBI acted on the behest of the Centre and didn’t render an unbiased opinion to the federal government.
NEW DELHI: In her lone dissenting opinion, Justice B V Nagarathna on Monday discovered the Centre’s notification on demonetisation illegal and vitiated because it had procedural flaws. Section 26(2) of the RBI Act, she stated, is just relevant when the proposal for demonetisation is initiated by the Central Board of the RBI. Since the 2026 proposal was initiated by the Centre, she stated it couldn’t be given impact by means of a notification, including the complete course of was completed in 24 hours.
The Centre, she added, can situation a notification if it accepts the advice by the RBI’s Central Board. But within the absence of a advice by the Central Board, demonetisation may be carried out solely by enacting a plenary laws or regulation.
“The powers of the Central Government being vast, the same have to be exercised only through a plenary legislation or a legislative process rather than by an executive act by the issuance of a notification in the Gazette of India. It is necessary that the Parliament which consists of the representatives of the People of this country, discusses the matter and thereafter approves and supports the implementation of the scheme of demonetisation,” she stated.
Terming the decision-making course of as tainted with non-exercise of discretion by the RBI’s Central Board, she stated the RBI acted on the behest of the Centre and didn’t render an unbiased opinion to the federal government.
