The Supreme Court on Wednesday ordered that the old N200, N500, N1000 notes should continue to co-exist with the new notes until further notice.
The apex court ruled that both old and new notes should remain as legal tenders until the Federal Government has put a process in place for its replacement or redesign after due consultation with relevant stakeholders.
In mid-November, the Central Bank of Nigeria (CBN) had said the old N200, N500, and N1,000 notes would remain legal tender indefinitely.
The seven-man panel led by Justice Inyang Okoro gave the ruling following an application by the Federal Government asking the court to grant an extension of time for old naira notes to remain in circulation as a legal tender.
The government also asked the court to lift its March 3 order, noting that the extension of time is necessary as it has not been able to print the volume of new notes that would enable a phasing out of the old currency before the December 31 deadline.
In the fresh application by the Attorney-General of the Federation and Minister of Justice, Chief Lateef Fagbemi (SAN), the Federal Government further explained that should the Supreme Court decline its request to extend the period of circulation of old notes, the country stands the risk of descending into another national, economic and financial crisis as witnessed in the first quarter of the year when the naira redesign policy was implemented under the former CBN Governor, Mr Godwin Emefiele.
It asked the court to allow the old notes to be in use with the new notes until it has consulted with stakeholders, pointing out that the economy may be in jeopardy once again because some Nigerians have started hoarding the old and new naira notes ahead of the December 31, 2023 deadline.
In a unanimous decision, the seven-man panel accepted Fagbemi’s application.
Persecondnews recalls that the CBN had on November 9, 2023, said all banknotes remain a legal tender and should not be rejected by anyone.
The apex bank said it is in accordance with Section 20(5) of the CBN Act, 2007.
The Director, Corporate Communications of CBN, Isa AbdulMumin, had in a statement said that the announcement became necessary to allay the anxiety of some members of the public over the legality of the old banknotes.
The statement said: “Our attention has again been drawn to reports of a scarcity of cash across some major cities in the country despite assurances of sufficient cash stocks in all locations across the country.
“There have also been reports of anxiety among some members of the public over the legality or otherwise of old Naira banknotes.
“For the avoidance of doubt, while reiterating that there are sufficient banknotes across the country for all normal economic activity, we wish to state unambiguously that every banknote issued by the Central Bank of Nigeria (CBN) remains legal tender and should not be rejected by anyone as stipulated in Section 20(5) of the CBN Act, 2007.”
It also directed all its branches across the country to continue to issue different denominations of the old and the redesigned banknotes in adequate quantities to deposit money banks.
“We wish to restate that all denominations of banknotes issued by the Central Bank of Nigeria (CBN) remain legal tender.
“In line with Section 20(5) of the CBN Act, 2007, no one should refuse to accept the Naira as a means of payment.
Consequently, members of the public are advised to accept all CBN-issued banknotes currently in circulation and guard against panic withdrawals.
“We reaffirm that there is sufficient stock of currency notes to facilitate normal economic activities,” the statement said.
Persecondnews also recalls that in October 2022, former CBN governor, Godwin Emefiele, had unveiled plans to redesign the N200, N500, and N1,000 notes, urging citizens to deposit their old notes before January 31, 2023, as they would lose their status as legal tender beyond that date.
The controversial monetary policy was challenged at the Supreme Court by some states, leading to the extension and validity of the N200, N500, and N1, 000 Naira notes till December 31, 2022.
A seven-member panel of the court led by Justice John Okoro unanimously directed that the CBN must continue to receive the old notes from Nigerians.
The court held that the directive of the then President, Muhammadu Buhari, for the redesign of the new notes and withdrawal of the old notes without due consultations is invalid.