Demonetisation: PAC can call PM if not satisfied by RBI Guv's reply, says KV Thomas

Tightening the noose around the meaning of demonetisation; government and RBI’s flip flop and constitutionality of currency ban, the Public Accounts Committee (PAC) has hinted that it may call Prime Minister Narendra Modi on the issue of demonetisation if it is not satisfied with the answers given by top finance ministry officials and the RBI  Governor Urjit Patel.

Asked if the PAC would call the Prime Minister if replies were not satisfactory, he said, "The committee has all right to call anybody involved in the matter. But that will depend on the outcome of the January 20th meeting. We can call PM on demonetisation issue if members unanimously decide."

PAC has handed over a list of questions to RBI Governor wherein his role, meaning of demonetization, flips-flops during the currency ban drive and many others questions were asked. The PAC has also asked the Governor to appear before PAC on January 28 and submit his reply. 

On Tuesday, PAC chairperson, KV Thomas said, “After hearing the RBI Guv and concerned officers in the meeting, Committee will take appropriate decision. ”

“Questionnaires submitted by PAC members sent to RBI Guv & concerned officers like Finance Secretary, Revenue Secretary, “he added.

 A PAC meeting on the issue has been called on January 20th, in which the RBI Governor Urjit Patel, Finance Secretary Ashok Lavasa and Economic Affairs Secretary Shaktikanta Das will be present.

"We have not yet received answers for the questions we have sent to them. They will reply few days before the January 20th meeting. Their replies will be discussed in detail," PAC Chairman K V Thomas said.

In a meeting with the PM after demonetisation announcement made on November 8, Thomas said, "I had met him and he said that the situation will be normal after 50 days by December-end. But it does not looks like."

"The PM is misleading the country to satisfy his ego. He is trying to justify his wrong decisions. He has done in a callous manner by introducing Rs 2,000 notes," he said.

"In a country where there is a call drop problem and telecom facilities are not smooth, how can PM expect e-transactions would take place on mobiles. Do we have sufficient infrastructure?" he questioned.

PAC's 10 questions to RBI Guv  

Q1. Has RBI taken demonetsiation decision as suggested by Union Minister Piyush Goyal who asked the government merely acted upon its advice.

Q2. If its RBI’s decision then do he accepts that it is in India’s best interests to demonetise currency.

Q3. What was the exact rationale laid out by the RBI for this decision to invalidate Rs 500 and Rs 1,000 notes overnight?

Q4. RBI’s own estimates show fake/ counterfeit currency to be a mere Rs 500 crore. India’s cash to GDP was 12 per cent. High denomination notes as a share of currency was 86 per cent in India, but 90 per cent in China and 81 per cent in US. So, what was so alarming that the RBI decided India needed to demonetise suddenly?

Q5. When was the notice sent to the RBI Board members calling for an emergency meeting on November 8? Pac ha also asked minutes of the meeting

Q6. Did RBI explained the centre that this decision would mean invalidating 86 per cent of the country’s currency and its attendant cost? How long did the RBI say it would take to remonetise?

Q7. The RBI notification of November 8, 2016 under Section 3 c(v) issued a restriction on withdrawal from a bank account over the counter to Rs 10,000 per day and Rs 20,000 per week. There was a similar limit of Rs 2,000 per day in an ATM. Under what law and powers of the RBI to impose such law.

Q8. Why have there been so many flip-flops in RBI regulations?

Q9. How much exactly was demonetised and how much has been deposited back in old currency?

Q10. Why has the RBI refused to reveal information under the RTI? Why is the RBI not providing information under RTI to queries that come?

Do Public Account Committee has right to call PM?

PAC can ask Prime Minister of India by taking permission of Lok Sabha speaker.