SC focused only on legal, technical aspects of demonetisation: KN Balagopal

Thiruvananthapuram: Sharing his thoughts on the Supreme Court verdict which upheld the Centre's 2016 decision to demonetise the Rs 1,000 and Rs 500 notes, Finance Minister K N Balagopal on Monday said the apex court only took into consideration its legal and technical aspects.

Balgopal further said: “Practically, the economic and social impact of demonetisation was serious and detrimental to the growth of various sectors. There were even studies by several economists and financial experts that proved the same.”

"It ruined for some time many areas of the economy," he added.

Earlier, speaking to reporters after the verdict was delivered, the minister said that the apex court only examined the legal aspects of the decision-making process, but the fact remains that the adverse impact of demonetisation on the commercial, service agriculture and various other sectors was continuing.

"There is no solution in the verdict to the financial crisis that resulted out of it (demonetisation)," Balagopal said.

Its impact would also be seen in the future, he added.

He further said that there was also a difference in views among the judges of the Constitutional bench which delivered the verdict as one of them said demonetisation ought to have been done by way of legislation.

The minister said that the Centre in 2016 took the decision to demonetise the two denominations to address the issue of black money and its use in terrorist activities.

"However, 99 per cent of the currency issued in those two denominations came back to the RBI. Therefore, what the central government sought to achieve never happened," he contended.

Balagopal said that was one of several decisions taken by the Centre under the BJP's leadership that have adversely affected the states and the general public.

After demonetisation, they are now going forward with monetisation -- to sell off the public sector undertakings and enterprises, he contended.

Meanwhile, former Finance Minister Thomas Isaac said the apex court upholding the Centre's decision "does not make it (demonetisation) a less Himalayan blunder".

He contended that demonetisation "torpedoed" India's 8 per cent growth and resulted in a national GDP loss of nearly Rs 15 lakh crore.

"SC's majority decision that demonetisation was legal, does not make it a less Himalayan blunder that torpedoed India's 8 per cent growth, resulted in a national GDP loss of nearly Rs 15 lakh crore and horrendous suffering to the people. Those responsible shall be tried in people's court," Isaac tweeted.

The Supreme Court in a 4:1 majority verdict on Monday upheld the government's 2016 decision to demonetise the Rs 1,000 and Rs 500 denomination notes, saying the decision-making process was not flawed.

(With PTI inputs)