Disposed

Dhanakodi Chits Private Limited v. Union of India

Kerala HC12 Jul 2017WP(C)/18107/2017

Case brief

AI extract

What is this about?

The Court held that a separate document authenticating serial numbers satisfies exchange requirements for demonetized currencies ordered released by a court, directing the RBI to accept and exchange the notes.

What did the court decide?

Directed the Thiruvananthapuram branch of the Reserve Bank of India to accept and exchange the demonetized currencies released to the petitioner, whose serial numbers are mentioned in Ext.P5, within o

Dhanakodi Chits Private Limited Vs Union of India — Money Laundering | Kerala HC (2017)

¶1

IN THE HIGH COURT OF KERALA AT ERNAKULAM

¶2

PRESENT:

¶3

THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR

¶4

WEDNESDAY, THE 12TH DAY OF JULY 2017/21ST ASHADHA, 1939

¶5

WP(C).No. 18107 of 2017 (K)

¶6

PETITIONER(S) :

¶7

DHANAKODI CHITS PRIVATE LIMITED, HEAD OFFICE AT GANDHI JUNCTION, SULTHAN BATHERY, WAYANAD,

¶8

REP. BY ITS MANAGING DIRECTOR M.M.YOHANNAN

¶9

BY ADVS. SRI.TONY THOMAS (INCHIPARAMBIL) SRI.P.THOMAS GEEVERGHESE

¶10

RESPONDENT(S) :

¶11

1. UNION OF INDIA,

¶12

REP. BY ITS SECRETARY TO THE GOVERNMENT, FINANCE MINISTRY, PARLIAMENT ANNEX, NEW DELHI-110 001.

¶13

2. RESERVE BANK OF INDIA, REP. BY SECRETARY & CHIEF GENERAL MANAGER, CENTRAL OFFICE BUILDING, SHAHID BHAGAT SINGH MARG, MUMBAI-400 001.

¶14

3. STATE OF KERALA, REP. BY THE SECRETARY TO THE GOVERNMENT, HOME DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM-695 001.

¶15

4. STATE POLICE CHIEF, KERALA STATE, POLICE HEAD QUARTERS, THIRUVANANTHAPURAM- 695 001.

¶16

5. SUB DIVISIONAL MAGISTRATE, KOZHIKODE- 673 001.

¶17

6. SUPERINTENDENT OF POLICE (KOZHIKODE RURAL), KOZHIKODE- 673 001.

¶18

..2/-

¶19

..2..

¶20

WP(C).No. 18107 of 2017 (K)

¶21

7. SUB INSPECTOR OF POLICE, KOILANDY POLICE STATION, KOILANDY, KOZHIKODE DISTRICT- 673 305.

¶22

R1 BY BY ADV. SRI.N.NAGARESH, ASSISTANT SOLICITOR GENERAL ADV. SRI.SUVIN R.MENON, CGC R3 TO R7 BY GOVERNMENT PLEADER SRI. K.J.MANURAJ

¶23

THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12-07-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

¶24

Msd.

¶25

WP(C).No. 18107 of 2017 (K)

¶26

APPENDIX

¶27

PETITIONER(S)' EXHIBITS :

¶28

EXHIBIT P1 A TRUE COPY OF THE FIR CRIME NO.1296/2016 OF KOILANDY POLICE STATION DATED 02.12.2016.

¶29

EXHIBIT P2 A TRUE COPY OF THE PETITION FILED BY THE PETITIONER UNDER SEC. 451 CR.P.C. BEFORE THE 5TH RESPONDENT DATED 07.02.2017.

¶30

EXHIBIT P3 A TRUE COPY OF THE DAILY CHIT COLLECTION AND ARREAR COLLECTION DETAILS OF THE PETITIONER FOR VARIOUS PERIODS.

¶31

EXHIBIT P4 A TRUE COPY OF THE ORDER NO.11971/2016 OF THE 5TH RESPONDENT DATED 22.03.2017.

¶32

EXHIBIT P5 A TRUE COPY OF THE LIST OF SERIAL NUMBER OF BANK NOTES SEIZED AS PER EXT.P1 ISSUED BY THE 5TH RESPONDENT.

¶33

EXHIBIT P6 A TRUE COPY OF THE REPRESENTATIONS SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 24.03.2017.

¶34

EXHIBIT P7 A TRUE COPY OF THE REPRESENTATIONS SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 30.03.2017.

¶35

EXHIBIT P8 A TRUE COPY OF THE COMMUNICATION NO. ID(CHE) ADMN NO.5570/01-01-039/2016-17 DATED ON 03.04.2017.

¶36

EXHIBIT P9 A TRUE COPY OF THE SPECIFIED BANK NOTES (CESSATION OF LIABILITIES) ACT, 2017 PUBLISHED IN GAZETTE OF INDIA DATED 28.02.2017.

¶37

EXHIBIT P10 A TRUE COPY OF THE COVERING LETTER OF THE 2ND RESPONDENT.

¶38

EXHIBIT P11 A TRUE COPY OF THE RELEVANT EXTRACT OF THE NOTIFICATION NO.S.O.4251[E] DATED DECEMBER 30, 2016 ISSUED BY THE 2ND RESPONDENT.

¶39

RESPONDENT(S)' EXHIBITS & ANNEXURES :

¶40

ANNEXURE R1(A): A TRUE COPY OF THE ORDER DATED 16.12.2016.

¶41

ANNEXURE R1(B): A TRUE COPY OF THE SPECIFIED BANK NOTES (DEPOSIT OF CONFISCATED NOTES) RULES, 2017.

¶42

WP(C).No. 18107 of 2017 (K)

¶43

ANNEXURE R1(C): A TRUE COPY OF THE GUIDELINES ISSUED BY 2ND RESPONDENT.

//TRUE COPY//

P.A.TO JUDGE.

Msd.

P.B. SURESH KUMAR, J.

¶48

W.P.(C) No.18107 of 2017

¶49

Dated this the 12^th day of July, 2017

¶50

JUDGMENT

¶51

On information from reliable sources that

¶52

monetary transactions are being undertaken by M/s.Dhanakodi Chits Private Limited, Koilandi with their customers using demonetized currency notes of 1000 and 500 rupee denominations, Koilandy Police seized 169 numbers of 1000 rupee and 30 numbers of 500 rupee demonetized currencies from the said company. The petitioner is the Managing Director of the said company. The petitioner moved the Court of Sub Divisional Magistrate, Kozhikode for release of the seized demonetized currencies. The Sub Divisional Magistrate

¶53

W.P.(C) No.18107 of 2017

¶54

-2-

¶55

found that the currencies seized by the police are currencies retained by the petitioner on 07.11.2016 for disbursement to the prized subscribers of the chitties run by them and consequently directed to release the same to the petitioner. Ext.P4 is the order issued by the Sub Divisional Magistrate in this connection. Ext.P5 is the document issued by the Sub Divisional Magistrate to the petitioner authenticating the serial numbers of the demonetized currencies released to the petitioner as per Ext.P4 order. Ext.P4 order was passed on 22.03.2017. In the meanwhile, the time limit prescribed for exchanging the demonetized currencies was over. The petitioner, therefore, approached this Court for appropriate directions to enable them to exchange the demonetized currencies released to them as per Ext.P4 order of the Sub Divisional Magistrate.

¶56

Heard the learned counsel for the petitioner

¶57

W.P.(C) No.18107 of 2017

¶58

-3-

¶59

as also the learned Central Government Counsel.

¶60

The learned Central Government Counsel

¶61

submitted that the demonetized currencies released to the petitioner as per Ext.P4 order can be exchanged by the designated offices of the Reserve Bank of India only on satisfying the conditions stipulated in Rule 2 of the Specified Bank Notes (Deposit of Confiscated Notes) Rules, 2017 framed under sub-section (1) of Section 11 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017. According to the learned Central Government Counsel, as per Rule 2 of the Rules referred to above, exchange can be claimed in respect of the demonetized currencies ordered to be released by courts, only where the order reflects the serial numbers of the demonetized currencies. According to the learned Central Government Counsel, Ext.P4 order does not reflect the serial numbers of the demonetized currencies directed to be released to the petitioner and therefore, the petitioner is not entitled to exchange the

¶62

-4-

¶63

W.P.(C) No.18107 of 2017

¶64

currencies released to them as per Ext.P4 order.

¶65

4. Rule 2 of the Specified Bank Notes (Deposit

¶66

of Confiscated Notes) Rules, 2017 reads thus:

¶67

“2. Deposit of confiscated specified bank notes.— Where specified bank notes have been confiscated or seized by a law enforcement agencies or produced before a court on or before the 30^th day of December 2016, such specified bank notes may be tendered, at any office of the Reserve Bank specified under sub-section (1) of section 4 of the Act or a nationalised bank designated by the Reserve Bank for the said purpose, for deposit in a bank account or exchange of the value thereof with legal tender, subject to the following conditions, namely:—

¶68

(a) in case confiscated specified bank notes are returned by the court to a person who is a party in case pending before that court, then, the person shall be entitled, on production of the direction of the court, to deposit or exchange such specified bank notes, the serial numbers of which—

¶69

(i) have been noted by the law enforcement agency which confiscated or produced them before the court; and

¶70

(ii) are mentioned in the direction of the court;

¶71

(b) in case specified bank notes are forfeited in favour of the Central Government or the State Government by an order of the court, then, that Government shall be entitled, on production of the direction of the court, to deposit or exchange such specified bank notes; or

¶72

(c) in case specified bank notes are placed in custody of any other person by an order of the court on or before the 30^th day of December, 2016, then, the person shall be entitled, on production of the direction of the court, to deposit or exchange

¶73

W.P.(C) No.18107 of 2017

¶74

-5-

¶75

such specified bank notes, the serial numbers of which—

¶76

(i) have been noted by the law enforcement agency which confiscated or produced them before the court; and (ii) are mentioned in the direction of the court.”

¶77

It is seen that it is relying on clause (a) (ii) of Rule 2 of the Rules that the learned Central Government Counsel has made the submission referred to above. True, Ext.P4 order passed by the Sub Divisional Magistrate does not contain the serial numbers of the demonetized currencies directed to be released to the petitioner. Ext.P5 is a separate document issued by the Sub Divisional Magistrate to the petitioner indicating the serial numbers of the demonetized currencies directed to be released. According to me, Ext.P5 satisfies the requirement of Rule 2 of the Rules referred to above.

¶78

In the result, the writ petition is disposed of directing the Thiruvananthapuram branch of the Reserve Bank of India to accept the demonetized currencies released to the petitioner covered by Ext.P4 order, the

¶79

W.P.(C) No.18107 of 2017

¶80

-6-

¶81

serial numbers of which are mentioned in Ext.P5 and exchange the value thereof, within one month from the date of production of the demonetized currencies before the Thiruvananthapuram branch of the Reserve Bank of India.

¶82

Sd/- P.B. SURESH KUMAR JUDGE

¶83

bpr

Dhanakodi Chits Private Limited v. Union of India

Case brief

What is this about?

What did the court decide?

Dhanakodi Chits Private Limited v. Union of India

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Hari Shankar Mohan Nair Vs State of Kerala

Nimisha Elizabeth Vs the State of Kerala

Chandran.a Vs Majalisul Hidaya Charitable Trust

Mathew Mohan Vs the Tahasildar, Ottappalam

Hope Plantations Vs K.S.I.D.C.

Hope Plantations Vs Kerala State Industrial Development Corporation