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Twenty-year-old law allowing circulation of demonetised notes from Reserve Bank gets scrapped

A law which allowed the Reserve Bank of India (RBI) to circulate Rs 1000 denomination notes in the late 1990s, to tide over the shortage of currency has been scrapped. On Friday, Parliament passed a bill to repeal 58 laws from the statute books. The High Denomination Bank Notes (Demonetisation) Amendment Act, 1998 is one of 58 "redundant" laws repealed last week.

India TV Business Desk India TV Business Desk
New Delhi Updated on: August 04, 2019 16:41 IST
Twenty-year-old law allowing circulation of demonetised
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Twenty-year-old law allowing circulation of demonetised notes from Reserve Bank gets scrapped

A law which allowed the Reserve Bank of India (RBI) to circulate Rs 1000 denomination notes in the late 1990s, to tide over the shortage of currency has been scrapped. On Friday, Parliament passed a bill to repeal 58 laws from the statute books. The High Denomination Bank Notes (Demonetisation) Amendment Act, 1998 is one of 58 "redundant" laws repealed last week.

The then finance minister, Yashwant Sinha, had moved the bill in December 1998 to allow RBI circulate Rs 1000 denomination notes.

"To eliminate the shortage of currency notes and to ease the pressure on other denominations, it is proposed to amend section 2 of the High Denomination Bank Notes (Demonetisation) Act, 1978. 

This will facilitate the Reserve Bank of India to issue notes of Rs 1,000 denomination immediately," read the amended Act which came into force in 1999.

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On 8 November 2016, the PM Modi-led NDA government announced demonetisation of all Rs 500 and Rs 1,000 banknotes of the Mahatma Gandhi series.

The government also announced the issuance of new Rs 500 and RS 2,000 notes. The Rs 1000 denomination notes are no longer in circulation. The 58 laws repealed last week would now be removed from the statute books

(With PTI inputs)

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