Hence RBI notes which are a liability promises to pay you an asset. This asset is defined by "One rupee" So, the Government of India has the power to mint/print 1 Rupee coin/note which are an asset and define the unit of currency. RBI notes get the value from the asset known as 'Rupee'.

Liability of the Government of India

The issue of one rupee currency note in India is the liability of the Government of India. This means that the Government of India is responsible for the redemption of the one rupee currency note and for maintaining its value.

Explanation:

The one rupee currency note is the lowest denomination note in India. It is issued by the Government of India and is authorized by the Reserve Bank of India (RBI) under the Currency Act, 1961.

Role of the Government of India:

The Government of India is responsible for the issuance and management of currency in the country. It has the authority to determine the design, production, and circulation of currency notes. The one rupee currency note is printed and distributed by the Government of India through the RBI.

Liability:

The liability of the Government of India refers to the obligation of the government to maintain the value of the currency and to redeem it when necessary. In the case of the one rupee currency note, the government is liable for its value and is obligated to honor it as legal tender.

Redemption:

Redemption refers to the process of exchanging a currency note for its equivalent value. In the case of the one rupee currency note, the government is responsible for redeeming it and providing the equivalent value to the holder of the note.

Other denominations:

It is important to note that the liability of other currency denominations, such as the higher denomination notes and coins, lies with the RBI. The RBI is responsible for the issuance, management, and redemption of these denominations.

Conclusion:

In conclusion, the issue of one rupee currency note in India is the liability of the Government of India. The government is responsible for the issuance, management, and redemption of the one rupee currency note, ensuring its value and honoring it as legal tender.