Defending its action, the Centre said the decision was based on RBI’s recommendation for the withdrawal of the Rs 500 and Rs 1,000 notes and its proposed draft scheme for implementation.
THE CENTRE Wednesday told the Supreme Court it began consultations with the Reserve Bank of India in February 2016 — at least eight months before notifying demonetisation i.e., withdrawal of legal tender character of Rs 500 and Rs 1,000 notes, on November 8, 2016.
“It was taken after extensive consultation with the RBI and advance preparation… The then Finance Minister had stated in the Parliament… that Government consultation with RBI began in February 2016; however, the process of the consultation and the decision-making were kept confidential,” it said in an affidavit.
“The withdrawal… of a significant portion of total currency value was a well-considered decision,” the Centre said in the affidavit, which it said should be read as part and parcel of its earlier two affidavits filed on December 1, 2016, and in October 2018.