The court's equitable discretionary jurisdiction under Article 226 of the Constitution of India allowed it to direct the RBI to replace demonetized currency with valid tender, subject to the Petitioner fulfilling the specified conditions.

ORDER

1. Rule.

2. The Respondents have filed their Affidavits in Reply. By consent, the Respondents having waived service of Rule, we make Rule returnable forthwith and take up the Petition for hearing and final disposal.

3. The facts of the case are not contentious. The Petitioner filed a CR No 564 of 2016 with the Dombivali police station under sections420, 504 and 506 of the Indian Penal Code, 1860. The Petitioner was the first informant. That case is pending trial. In that matter, the Judicial Magistrate, First Class-3, Kalyan, Thane directed the accused to deposit Rs 1,60,000/- with the police station. The accused deposited the amount in cash. The matter rested there until 20th March 2017. On that date, the JMFC-3, Kalyan directed the Petitioner and one witness to collect the money from the police station. The Petitioner was entitled to Rs 60,000/- and the witness was entitled to Rs 1 lakh. The witness filed an Affidavit stating that the Petitioner was entitled to the entire amount.

4. Matters might have proceeded smoothly but for the Government of India Notification of 8th November 2016 which demonetised certain currency notes. The Petitioner says that he believed that since his cash was with an authority it was protected from demonetisation. Paragraph 6 of the Petition states that since the Petitioner was not then in urgent need of cash, he "considered the said money as his savings which were with the Government Authority". We note that the money was still with the police station and we resist the temptation to say anything further about this averment. Time went by. Then there was Covid-19 pandemic and lockdown after March 2020. When the Petitioner finally went back to the police station for return of his money, he was handed the old currency notes, all by then demonetised and every note, as the Petitioner puts it in the Petition, "just a piece of paper having a photo of Mahatma Gandhi."

5. The solution that the Petitioner asks is for a direction to the RBI to replace the old currency notes since they were all along in custody of the police with valid current tender.

6. There is an excellent Affidavit in Reply by the RBI. We quote paragraphs 9 to 11 at pages 25 to 27 :

"9. I say that the RBI can accept SBNs only when the conditions specifiied in SBN Rules are met with and not otherwise. In terms of the provisions of the SBN Act, the answering respondent was not empowered to exchange SBNs except under certain situations mentioned in the said Act and in accordance with the SBN Rules. It is submitted that the SBN Act regulates, prescribes the power of the answering respondent to give credit for SBNs tendered to the answering respondent. It is, therefore, most humbly submitted that there is a statutory prohibition upon the RBI against accepting SBNs from and giving credit/value in respect thereof, to persons other than those specified in the SBN Rules, thus the RBI has neither the power nor authority to accept the SBNs of the Petitioner as prayed for in the petition.

10. I say that the petitioner had approached the answering respondent vide email dated October 08, 2020, had requested to exchange the confiscated SBNs. The Applicant-petitioner was advised by the Bank vide email dated October 09, 2020 to submit the application along with the supporting documents in terms of Specified Bank Notes (Deposit of Confiscated Notes) Rules, 2017. The petitioner then made an application vide email dated October 12, 2020 and hard copy of the same was also received later. The application submitted by the petitioner was scrutinized in terms of the Specified Bank Notes (Deposit of Confiscated Notes) Rules, 2017 issued by the Government of India i"9. I say that the RBI can accept SBNs only when the conditions specified in SBN Rules are met with and not otherwise. In terms of the provisions of the SBN Act, the answering respondent was not empowered to exchange SBNs except under certain situations mentioned in the said Act and in accordance with the S