So far, around 76 percent of the Rs 2,000 notes in circulation have been returned to banks, mostly through deposits, as per the information provided by the Reserve Bank of India on Monday.
Withdrawal Of Rs 2,000 Notes
Earlier, RBI announced the withdrawal of Rs 2,000 notes in circulation on May 19.
The country’s central bank has given the public time till September 30 to either deposit the currency notes in their bank accounts or get them exchanged.
In a statement, RBI said, “the total value of Rs 2,000 bank notes received back from circulation after the announcement on May 19 is Rs 2.72 lakh crore up to June 30, 2023.”
Adding, “Consequently, Rs 2,000 banknotes in circulation as at the close of business on June 30 stood at Rs 0.84 lakh crore.”
Out of the total banknotes in Rs 2000 denomination received back from circulation, about 87 per cent is in the form of deposits and the remaining around 13 per cent has been exchanged into other denomination bank notes, as per the data collected from major banks.
Decision Part Of Currency Management
In a recent development, the Delhi High Court has dismissed a PIL plea challenging the Reserve Bank of India’s May 19 notification announcing the withdrawal of its highest value currency note of Rs 2,000.
In its July 3 order, a division bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad observed, “A perusal of the notification in question shows that the RBI has not taken any decision for discontinuance of Rs 2,000 bank notes. It is not a decision to demonetise Rs 2,000 bank notes and this circular is only a direction to the banks to desist from issuing Rs 2,000 denomination notes to its customers and to ensure that no withdrawal of Rs 2,000 denomination notes is allowed from the banks holding currency chests.”
The bench while dismissing the plea observed that the RBI is “well within its power to issue the notification in question which is only a part of the currency management system”, referring to various decisions of the apex court which have settled the “scope of judicial interference in matters relating to economic policy”.
The HC said, “The RBI has only instructed the banks not to issue to its customers notes of Rs 2,000 denomination in order to ensure that Rs 2,000 banknotes are not in circulation though they remain to be legal tender. The fact that the permission to exchange Rs 2,000 notes is available only till 23.09.2023 does not mean that RBI has issued a direction that from 23.09.2023 Rs 2,000 banknotes will be demonetised.”
Further, adding that the body had not exceeded its powers conferred under the RBI Act or has violated the Banking Regulation Act.
