Raja Vijayaraghavan, J.

1. The instant Suo moto proceeding was initiated to fix the modalities and to deal with the unforeseen situation that was faced by Subordinate courts in the State of Kerala pursuant to demonetization of certain specified bank notes.

2. By virtue of Notification dated 8.11.2016, the Central Government in exercise of its powers conferred by subsection (2) of Section 26 of the Reserve Bank of India Act, 1934 had declared that Bank Notes of denominations of the existing series of the value of Rs.500/- and Rs. 1000/- would cease to be legal tender with effect from 9.11.2016. However, opportunity was granted, subject to various conditions, to exchange the specified Bank Notes for notes having legal tender for a period upto and including 30th December, 2016.

3. Immediately thereafter, it was brought to the notice of this Court that properties produced in the form of cash of the above denominations, seized by the police and other law enforcement authorities are kept in the custody of Subordinate courts. They would cease to be legal tender if not exchanged within the prescribed cutoff date. Instructions were sought to deal with the unforeseen situation.

4. Direction was thereafter issued on the administrative side, as an interim measure, to take up and dispose of matters regarding the disposal of specified Bank Notes expeditiously. In those cases where the specified Bank notes were required to be retained for the disposal of the cases, the presiding officers were directed to prepare the details of the Bank notes, indicating number and denomination, and to forward the copy to the District Judge, who in turn was directed to forward a consolidated statement to this Court.

5. It was thereafter that this proceeding was initiated for considering the matter on the judicial side and for passing appropriate orders for the disposal/exchange of demonetized currency notes.

6. We have heard the learned Assistant Solicitor General who appeared for respondents No 1 and 2, the learned Standing Counsel appearing for the respondents 3 and 4, the learned Government Pleader who appeared for respondents 5 to 7 and also the learned Counsel appearing for the High Court.

7. The learned Assistant Solicitor General has placed on record Notification dated 12.5.2017 issued by the Central Government in exercise of powers conferred by sub (1) of Section 11 read with clause (c) of the proviso to section 5 of the Specified Bank Notes (Cessation of Liabilities) Act, 2017 which in our view would save the situation faced by the Courts in this state.

8. Rule 2 and 3 of the notification dated 12.5.2017 are extracted below for easy reference.

“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 30th 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 nationalized 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:—

(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 –

(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:

(b) in case specified bank notes were 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

(c) in case specified bank notes are placed in custody of any