Pune resident files PIL against RBI

MUMBAI: A Pune resident has filed a public interest litigation (PIL) alleging that the Reserve Bank of India (RBI) lost Rs 65,065 crore in 2006-07 due to fall in its valuation of investments in foreign exchange. Petitioner R S Kelkar said the RBI has not taken this loss to its profit and loss account and the Centre is also not accounting this loss in its accounts presented to Parliament. This loss is stored in a currency and gold revaluation account in RBI's balance sheet. It is on the valuation of investments done by the RBI from proceeds of market stabilisation scheme (MSS). The MSS bonds were also issued illegally and unconstitutionally, the PIL claims. The RBI borrowed a sum of Rs 161,058 crore by virtue of MSS bonds till January 18 this year. These bonds were issued after an MOU was signed by the Centre and the RBI in March 2004 without informing Parliament, the PIL said. Ironically, the country is paying interest on this amount at 7.5 per cent per annum and the proceeds are being invested in foreign exchange -- especially in US Treasury -- yielding almost no returns. Over and above this loss of interest, the country has also suffered this loss of more than Rs 65,065 crore on valuation, according to the PIL. Chief Justice Swatanter Kumar and Justice V M Kanade of the Bombay High Court heard the matter on Thursday and adjourned it for two weeks as the RBI sought time to file its version.
14 Jun 2008, 1153 hrs IST,PTI
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