"People are suffering, it is a serious problem", he said. The SC directed that the 72 petitions on demonetization to be categorized as based on their prayer so that it would be easy to hear.
Senior advocate P Chidambaram, appearing for co-operative banks, questioned the government's decision, saying that the rural economy is nearly paralyzed due to non-inclusion of cooperative banks.
Appearing for the Union government, Attorney General Mukul Rohatgi contended that the co-operative banks lacked infrastructure.
"The act of canceling legal tender character of existing series of Rs 500 and Rs 1,000 bank notes is only a reasonable restriction and regulatory in nature", the government said in an affidavit filed on Thursday. The AG informed the court that every day, many new petitions are being filed.
The Centre in its affidavit told the apex court that demonetization is a step to reduce ratio of cash transactions, adding the objective is to unearth illegal parallel economy.
On the introduction of Rs 2,000 notes, the government said this was done keeping in view the erosion of the purchase value of money due to the rising inflation.
It said the demonetization would also give a boost to anti-terror activities of the country.
Besides, there are district cooperative bank matters from Kerala, Tamil Nadu, Rajasthan, and Gujarat.
On November 29, the apex court had agreed to hear pleas of 14 co-operative banks of Kerala for its nod to transact business like banks, and BJP spokesperson and advocate Ashwini Kumar Upadhyay seeking demonetization of any currency note higher than Rs 100 denomination.
The Reserve Bank of India (RBI) had issued a notification saying district central cooperative banks will not be allowed to provide any exchange facility against Rs 500 and Rs1, 000 notes.