Multiple choice

U/s 22 of RBI Act, which of the following is incorrect regarding RBI?

  1. It has the authority to issue and manage currency of India.

  2. It issues all bank notes and currency notes.

  3. It can issue bank notes having denomination from Rs. 2 to Rs.10000.

  4. The bank notes are legal tender at any place in India.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Under Section 22 of the Reserve Bank of India Act, RBI has sole right to issue currency notes of various denominations, except one rupee notes. The one rupee note is issued by the Ministry of Finance and it bears the signatures of Finance Secretary, while other notes bear the signature of Governor, RBI. However, RBI is the only source of legal tender money because distribution of one rupee notes and coins and small coins all over the country is undertaken by the Reserve Bank as an agent of the Government.

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