The apex court in Nigeria, the Supreme Court today directed the Nigerian Government and Central Bank of Nigeria (CBN) to halt the planned phasing out of old Naira notes through the demonetization plan that was to be enforced with effect from Friday, February 10, 2023.
The apex court handed down the temporary halt while ruling of the suit lodged by Kaduna, Kogi and Zamfara states against the federal government seeking a restraining order to stop the full implementation of the naira redesign policy of the CBN.
In a motion ex-parte filed before the Supreme Court, the three states are praying the court to grant an interim injunction stopping the CBN from ending the timeframe within which the old N200, N500, and N1000 notes will cease to be legal tender.
The plaintiffs said since the announcement of the policy, there has been an acute shortage in the supply of the new naira notes in their states, adding that citizens who have dutifully deposited their old currency notes have increasingly found it difficult and sometimes next to impossible to access the new notes for their daily activities.
Asides from the unavailability of the new notes, the plaintiffs also submitted that the notice period given by the federal government was inadequate.
They submitted that the 10-day extension is insufficient to address the challenges plaguing the policy.
The plaintiffs have also filed a motion on notice to abridge the time within which the respondent may file and serve a counter-affidavit for an accelerated hearing.
The states are seeking a declaration that the demonetisation policy of the CBN is not in compliance with the extant provisions of the constitution, and the Central Bank of Nigeria Act, 2007.
They are also seeking a declaration that the three months notice given by the federal government through the CBN is in gross violation of the provisions of Section 20(3) of the CBN Act which specifies that reasonable notice must be given.
They also want the court to declare that by the express provisions of Section 20(3) of the CBN Act, the FG through the CBN has no power to issue a timeline for the acceptance and redeeming of banknotes issued by the bank, except as limited by section 22(1).
Consequently, the plaintiffs want the court to direct the immediate suspension of the demonetisation policy until the relevant provisions of the law are complied with.
The CBN had on October 26, 2022, announced its plan to redesign the three banknotes. President Muhammadu Buhari subsequently unveiled the redesigned N200, N500, and N1,000 notes on November 23, 2022, while the apex bank fixed a January 31 deadline for the validity of the old notes.
The CBN also pegged its weekly cash withdrawal limits to N500,000 for individuals and N5m for corporate firms.
With cries by many Nigerians, the apex bank extended the deadline from January 31 to February 10, saying it got the approval of the President.
