The Supreme Court on Tuesday agreed to hear a petition filed jointly by seven district co-operative banks from Kerala claiming demonetisation policy is well on its way to cripple the entire co-operative sector banking in rural, agrarian societies across the country.
A Bench led by Chief Justice of India T.S. Thakur agreed to hear the petition on December 2.
In a rare attack of partisanship aimed at the Reserve Bank of India, the district co-operative banks said this was a concerted move with the Centre to impact the “entire edifice of the co-operative banking structure across India especially in respect of rural, semi rural and agrarian societies”.
“The violation of the rights is not restricted to the district/central co-operative banks situated within the State of Kerala but also extend to district co-operative banks across India,” the petition said.
Anti-competitive
It said the demonetisation policy decision was “anti-competitive, violative of the spirit of the Constitution and unfairly seeks to promote the interests of certain banks and financial institutions.”
The petition said neither the RBI notification nor the government has so far come out with any plausible reason or any “reasonable and intelligible classification” to explain the discrimination shown to the co-operative sector banks by allowing them not to function as banks.
‘Grave threat’
The policy, the co-operative banks said, “severely cripple and hamper the business/banking activities being carried out, thereby posing a grave threat to the very continuance and sustainability of these decades-old institutions”.
The Bench also agreed to hear on the same day another petition filed by Delhi BJP spokesperson and Supreme Court advocate Ashwini Kumar Upadhyay sought to recall higher denomination currency above Rs. 100.
The petition, which made the Centre, Prime Minister’s Office and the Reserve Bank of India parties, has sought steps to restrict the cash transactions.
