New Rs 2,000 note is not legal tender

A Rs 2 for Rs 2 note issued in the country, the only one that can be made with the government issuing new Rs 500 notes, has not been legal tender in the eyes of a Supreme Court.

In the Supreme Court on Thursday, Chief Justice R.K. Sathasivam asked the government to “give a satisfactory explanation for the illegality of the new Rs 2 and the RBI’s refusal to do so.”

“If the government refuses to make the new notes legal tender, will you please explain why the notes are not legal to use?

Will you give an answer on this?

Please,” Sathavamsi asked the Centre, which has been asking the Supreme Bank to amend the note issue to make it legal to exchange.

The Centre’s plea was rejected by the court, which said it is a matter for the RBI to consider and it has to make its decision in a “timely manner.”

The court was hearing a petition by the Centre that has argued that the government is violating its fiduciary duty of providing for the public’s interest by not issuing legal tender notes and that the Reserve Bank of India (RBI) is not competent to deal with the matter of legal tender.

The petition has said that the RBI is “unable to issue new notes” and that “there is no statutory requirement to issue the notes”.

The RBI has been issuing new notes since July last year.

It said on September 30, the Reserve Banks of India and Bank of Baroda had issued new Rs 1,000 and Rs 500 bills with new legal tender denomination of Rs 2 per 1,500 notes issued in 2016.

The new notes, issued by the RBI and the central bank, were initially supposed to be issued to the public by October 17, but they have not been officially issued by either the central or state governments.

The court has ordered the government, the central and state governments to submit their proposals on the legal tender issue within two weeks.

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