Nagpur: In a significant relief to a businessman caught in the fallout of demonetisation, the Nagpur Bench of the Bombay High Court has directed the Reserve Bank of India (RBI) to exchange old currency notes worth Rs 2 lakh that were seized by police and returned only after the official deposit deadline had expired.
A division bench comprising Justice Urmila Joshi-Phalke and Justice Nivedita Mehta passed the order while allowing a writ petition filed by Girish Rameshchandra Malani.
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As per court records, Malani was travelling to Mahur on December 1, 2016, to visit the Renuka Devi Temple when his vehicle was intercepted at Keroli Naka during routine municipal election surveillance. Police seized Rs 2 lakh in cash, comprising 400 notes of Rs 500 denomination, and deposited it at Mahur Police Station.
The seizure was subsequently reported to the Income Tax Department, which found the cash to be legitimate and did not initiate any proceedings.
Returned too late
Despite being cleared, the money was returned to Malani only on December 31, 2016, a day after the deadline for depositing demonetised notes had lapsed. When Malani later approached RBI for exchange, his request was rejected, forcing him to move the High Court.
The bench held that Malani had been unfairly deprived of the opportunity to deposit his money due to circumstances entirely beyond his control, as the cash remained in official custody during the crucial window.
Observing that citizens cannot be penalised for administrative actions, the court ruled in Malani’s favour and issued clear directions to RBI.
Directions issued
• Malani has been asked to submit the demonetised notes to RBI within one week.
• RBI has been directed to verify the serial numbers and complete the exchange process within eight weeks, in accordance with law.
Key observations by the court
• The petitioner had no control over the seized cash during the relevant period.
• A citizen cannot be placed at a disadvantage due to actions of authorities.
• Procedural requirements, such as submission of note serial numbers, cannot be enforced rigidly when compliance was rendered impossible by official action.
• Since the petitioner later furnished serial number details, RBI’s objection on that ground was not sustainable.
A wider message
Beyond individual relief, the ruling underscores a broader principle: administrative lapses cannot override citizens’ rights. The judgment sends a clear signal that procedural rigidity must give way to fairness, especially when state action itself creates the barrier.
