Some curious facts have emerged on One
rupee Paper Currency issued by the Govt of India. Money in the form of Currency
or Coin for issue and circulation is wholly managed by the Reserve Bank of
India. Though the metallic Coins are minted by the Govt, the Currencies are
printed by the Reserve Bank of India and both are issued and circulated by RBI
on behalf of the Govt. The Indian currency is called the Indian Rupee (₹) and
the coins are called Paise. The
Indian Currencies are however called Bank Notes as they are issued by the
Reserve Bank of India on behalf of the Govt.
Only Reserve Bank of India is authorised to
issue Bank Notes in values from rupees two denomination to rupees thousand
deno. The RBI is also authorised to issue Bank Notes in denominational value of
rupees 10000. The Paper Currencies issued by RBI in the name of Bank Notes
carry the title ‘The Reserve Bank of India’ to establish that it has been
issued by RBI and the Bank Notes carry the signature of the Governor of RBI.
Section 22 of the RBI Act 1934 provides sole right to RBI to issue Bank notes
of all denominations. The rule says that ‘every banknote issued by Reserve Bank
of India ( ₹ 2, ₹ 5, ₹
10, ₹ 20, ₹ 50, ₹
100, ₹ 500 and ₹ 1000) shall be legal tender at any place
in India for payment or on account for the amount expressed therein, and shall
be guaranteed by the Central Government, subject to provisions of sub-section
(2) Section 26 of RBI Act, 1934’.
The RBI is not authorised to issue metallic
Coins in any denominations. Tin respect of issue of Coins, the role of RBI is
limited to distribution of Coins that are supplied by Government of India. The
responsibility for coinage vests with the Government of India on the basis of
the Coinage Act, 2011, as amended from time to time. The prerogative of issuing
metallic Coins as Money rests with only the Govt of India.
The metallic Coins in deno of 50 paise to
rupees ten including the sub divisions can be issued by the Government of
India, including One rupee as Paper Currency since it is listed under Coins.
The only Paper Currency in the value of rupee One issued carry the title ‘The
Government of India’ to establish that the One rupee Paper Currency has been
issued by the Government as Coin. The note carries the signature of the Finance
Secretary of Ministry of Finance.
Coins up to 50 paisa are called small coins
and coins of Rupee one and above are called Rupee coins. The sub division Coins
(Small Coins) in Paise have since been withdrawn and are not circulated. The
rule states that the ‘Coins issued under the authority of Section 6 of The
Coinage Act, 2011, shall be legal tender in payment or on account i.e. provided
that a Coin has not been defaced and has not lost weight so as to be less than
such weight as may be prescribed in its case: - (a) coin of any denomination
not lower than one rupee shall be legal tender for any sum, (b) half rupee coin
shall be legal tender for any sum not exceeding ten rupees’.
Thus there has been clear division in Money
Act on the authority to print or mint Paper Currencies and Metallic Coins and
the quantum of Money for certain value to be put to circulation in each budget
year is decided in mutual consultation by the Govt and RBI. Though the same has
been in vague ever since the Government of India took over the rule from
Britishers, the Bank Note printers and collectors will be surprised to find
that the gazette notification or any other legal document that provide clear
guidelines in respect of the titles to be printed on One rupee note and other
Bank Notes in various denominations is curiously not available as revealed in
an RTI query found with NDTV –Profit as published dated 12th January 2016. Read the report given below:
Quote:
........Activist Manoranjan Roy had filed
an RTI query with the RBI recently seeking gazette copy or any other legal
document with respect to the two different titles printed on Re 1 note and
other notes.
In its reply, RBI's Central Public
Information Officer Uma Shankar said, ‘The information sought is not available
with us.’
Notes of Re 1 bear the signature of
Secretary, Ministry of Finance, while currency notes of all denominations carry
signature of the Governor of RBI.
Roy said that the discrepancy in the title
is ambiguous and, moreover, it seems like the RBI was doing its job ‘without
clear-cut guidelines’.
The activist also said the RBI Governor's
signature on the currency notes, which are in both Hindi and English, should
only be in one language. ‘These are definitely not part of security features on
a currency note but definitely create unnecessary ambiguity. It is time that
the Finance Ministry take a note of it.’
Unquote
Another interesting point needs to be seen
on the issue of One rupee note. The mute question is whether Govt of India is
legally empowered to issue Paper Currency of rupee One denomination where as
only RBI is the sole authority to issue the Paper Currencies in India. As per
the Coinage Act the Govt can issue only metallic Coins in various denominations
and sub divisions. This issue was again taken up by some activists and matter
referred to the Ministry of Law for their opinion.
The opinion given by the Law Ministry has
been published by The Hindu National Daily. Read the following as published on
September 07, 2014 issue. Only the relevant paras have been given under .
Quote:
............Putting to rest the debate on
printing of one rupee notes, the Law Ministry has opined that the Government of
India has all the powers to print currency notes of this denomination ( meaning
one rupee note- author)
................. since the RBI was of the
view that with the repeal of Section 2 of the Currency Ordinance, the
Government of India is not empowered to issue note of denominational value of
one rupee, the law ministry opinion was taken.
..............The Law Ministry in its
opinion stated that the Coinage Act of 2011, which consolidates the laws
relating to coinage and the mints, does not bar the Government of India from
printing one rupee notes.
...............Section 4 of the Act
provides that the central government may authorize minting of coin of
denomination not higher than Rs. 1,000, it said, adding that the definition of
coin in the Act makes it clear that Government of India one rupee note is
included in the definition of coin.
.............The Act defines a coin as
“made of any metal or any other material stamped by the Government or any other
authority empowered by the Government in this behalf and which is a legal
tender including commemorative coin and Government of India one rupee note,”
the ministry said in its opinion.
........................“Further, apart
from the metal, the coin may be made of any other material,” it said.
....................The ministry said while
repealing the Currency Ordinance, 1940, “necessary provisions for inclusion of
Government of India one rupee note within the meaning of ‘Coin’ have been
consciously incorporated in the Coinage Act, 2011. Further, the RBI, as per
Section 24(1) of the RBI Act, 1934, is not empowered to issue bank note of
denomination of value of one rupee.”
.................“Central government is not
precluded to issue one rupee Government of India note under the Coinage Act,
2011. The dimension, design, material and standard weight of such One Rupee
Note have to be prescribed by the Central Government in terms of Section 4 and
5 of the Coinage Act, 2011,” the opinion said.
Unquote
How much One rupee notes have been printed
and issued by the Government of India? The RTI query as published by NDTV-
Profit dated January 06, 2016 sates the following.
Quote:
The Finance Ministry issued as many as 160
million currency notes of one rupee denomination in the last two years, nearly
two decades after they were taken off print, response to queries made under the
RTI Act showed.
Delhi-based RTI activist Subhash Chandra
Agrawal and Mumbai-based RTI activist Manoranjay Roy had in separate RTI
queries sought the number of one rupee currency notes issued by the government
in the last 20 years.
‘In 1994-95, total 40 million currency
notes of one rupee denomination were issued. Thereafter, there was no issuance
of one rupee notes from fiscal year 1995-96 till fiscal year 2013-14,’said the
reply furnished by Deputy Manager (HR) and Public Information Officer of
Currency Note Press G Krishna Mohan.
However, in the fiscal year 2014-15, a
total of five million notes and in the current fiscal year, a total of 155
million notes of one rupee denomination were again introduced in the market,
the reply said.
It further said that in fiscal year 1994-95,
the production cost of 40 million currency notes of one rupee denomination was
Rs 59,40,059, implying that the production cost stood at Rs 1.48 per note.
Unquote