In an affidavit to the Supreme Court listing the advantages of demonetizing Rs 500 and Rs 1000 currency notes, the government said that the move will boost India’s economy in the longer run, creating more jobs and stamping out counterfeit currency. It explained that reducing the circulation of black money would help the poor and middle class.
The government pointed out in its affidavit that there are a number of positives because of demonetization while adding that the decision has been taken on the advice of the Reserve Bank of India. Submitting the RBI statistics to the apex court, the Centre said that it has become necessary for a strong step with the growing menace of black money and counterfeit currency being pumped by Pakistan to destabilize the Indian economy.
The government claimed that demonetization will check the circulation of counterfeit currency and also stop funds supply to anti-social groups. Earlier, the Union Defense Minister Mr.Parrikar said that after demonetization there was no stone pelting in Kashmir and also, terror group activities have decreased significantly in the Eastern states. According to the government, anti-social organizations and certain terror groups are using counterfeit currency for luring locals to do illegal activities.
Also, the government expressed that deposing money in bank accounts will boost cashless transactions, which in turn helps in proper tracking of financial activities. Overall, the banks will also benefit from the move as it helps them to give more loans with lower interest rates. Attorney General Mukul Rohatgi said that increased tax payers will boost the country’s economy and that the government can spend more on speedy completion of Irrigation projects.
On the other side, Kapil Sibal, leading a pack of lawyers against the government on different petitions filed by various organizations, requested the apex court to consider the inconvenience faced by the public before deciding on any matter relating to demonetization. Kapil Sibal argued that the government cannot put restrictions on how much one should withdraw his own money from the bank.
The apex court will hear all the petitions and the constitutional validity of the demonetization steps, on December 2.