Abstract: With the study of computers and computer applications since the first phase of 20th century, Image Processing has upraised and withstand as a vast application field. The work in this field is incredible and of immense importance with respect to various applications like Medical, Computer Imaging Systems and Computer Aided Design, Digitization, Human Visual System (HVS), etc. The same enlighten interest and curiosity within us to work in the field of Image Processing. Thus, in the proposed system with the help of research and data available, we are framing out a way to detect counterfeit in the Indian Currency notes. This paper comprises of the related studies and work drafted by scholars who have already worked in this field. We have possibly framed out the comparative study of the work we referred so as to put forth the proposed system.