The Reserve Bank of India gave explanation over the cancellation of Rs 500 and Rs 1,000 notes, which is the key decision in currency reforms. The RBI said that they did not discuss over the issue for days and took a decision in just a single day. The Centre had informed its idea first and then we have okayed to cancel the Rs 500 and Rs 1,000 notes, it added. It may be mentioned here that Parliamentary Party on Economic Affairs lead by Veerappa Moily sought an explanation on the cancellation of notes and it’s after effects.
The RBI has submitted a seven-page report to the committee on December 22. In order to stop the circulation of fake currency notes, the financial sources of militancy and to bring out the black money, the Centre has asked the RBI to withdraw the Rs 500 and Rs 1,000 notes on November 7, the RBI told the committee in its report. For the past five year time, the fake Rs 500 and Rs 1,000 notes circulation has become more and many problems arose, the Centre explained.
On the next day, the Centre made the appeal, i.e., on November 8, the RBI central board met and gave its acceptance for the cancellation of big notes. The same day night, Narendra Modi, addressing the nation announced the scrapping of the high denomination notes.