Correct Option: B

In terms of Section 22 of the Reserve Bank of India Act, the RBI has been given the statutory function of note issue on a monopoly basis. The note issue in India was originally based upon “Proportional Reserve System”. The Government of India issues rupee coins in the denomination of Rs.1, 2, and 5 to public. These coins are required to be circulated to public only through Reserve Bank un-der Section 38 of the RBI Act.