Chapter III — Central Banking Functions

Section 26A: Certain bank notes to cease to be legal tender

Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026

Section 26A is a narrow historical legal-tender provision for specified old bank notes.

Operative provisionOfficial sources mappedProvision-specific decode

Finin2min - Section 26A in 2 minutes

Legal effectSection 26A is a narrow historical legal-tender provision for specified old bank notes.

Operative ruleNotwithstanding Section 26, bank notes of Rs 500, Rs 1,000 and Rs 10,000 issued before 13 January 1946 are not legal tender. The section does not contain a general bar on RBI or Government liability.

Connected lawUse Section 26A only for the historical note class it identifies. Later withdrawal or specified-bank-note regimes must be analysed under their own legislation and notifications.

File evidenceRecord the denomination, series/issue date and the legal instrument governing the note. Do not infer liability consequences that are absent from Section 26A.

Statutory structure and clause / subsection decode

This map separates the operative limbs of this provision so thresholds, powers, conditions and exceptions are not collapsed into a single summary.

Override

Operates notwithstanding Section 26.

Covered denominations

Rs 500, Rs 1,000 and Rs 10,000.

Date test

The note must have been issued before 13 January 1946.

Effect

The covered note is not legal tender for payment or on account for its face amount.

Worked practical example

Facts. A collector presents a pre-13 January 1946 Rs 1,000 note and asks whether it remains legal tender. Section 26A answers the legal-tender question directly; any separate redemption or collector-value issue must be sourced elsewhere.

Compliance points and common mistakes

Do not decide the issue from the heading alone. Map the facts to the operative words of Section 26A and to each relevant subsection, clause, proviso or explanation shown above.
Keep the statutory question separate from the operational overlay. Use Section 26A only for the historical note class it identifies. Later withdrawal or specified-bank-note regimes must be analysed under their own legislation and notifications.
Do not convert an exception, exemption or discretionary RBI/Government power into an automatic entitlement. Record the authority, conditions and effective date.
Where the provision is historical, omitted or repealed, state that status prominently and do not present it as a current compliance obligation.

Connected provisions and instruments

Section 26A has no universal instrument dependency in this package. Add an RBI circular or direction only when its subject, entity and effective date cover the issue being analysed.

Questions and answers

What is the purpose of Section 26A?

Certain bank notes to cease to be legal tender: Section 26A is a narrow historical legal-tender provision for specified old bank notes.

Which statutory limb should be checked first?

Override - Operates notwithstanding Section 26.

What is the next legal boundary?

Covered denominations - Rs 500, Rs 1,000 and Rs 10,000.

What record should support the conclusion?

Section 26A file evidence: Record the denomination, series/issue date and the legal instrument governing the note. Do not infer liability consequences that are absent from Section 26A.

Primary sources

Source control for Section 26A: use the official consolidated RBI Act for the statutory text and footnotes, then separately reconcile any post-Finance Act 2022 amendment, commencement notification or RBI instrument relevant to the event date.