November 8th 2016, is a date you will not forget in a hurry. The Prime Minister Narenda Modi, in a speech at around 8 PM, banned 500 and 1000 rupee notes, effective midnight….which was just a few hours away. Your old 500 and 1000 rupee notes, were going to be useless in just a few hours. Why did the Government ban 500 and 1000 rupee notes? Simple…Break the back of corruption and terrorism in India, fueled by black money.
You can easily hide black money in old 500 and 1000 rupee notes, in your cupboard at home or even your mattress. Who will bother hiding black money in 100 rupee notes? The Government banned 500 and 1000 rupee notes, forcing you to bring out all your hidden black money. Your life changed in an instant. You and several of our citizens rushed to buy…well, whatever you could, with your old 500 and 1000 rupee notes, in the few hours left.
You and other citizens, rushed to buy costly smart phones and laptops. Mobile shops and high end electronic stores stayed open….well past midnight as citizen bought the latest electronic gadgets using black money. Many smart citizens rushed to jewelry stores to buy gold bars and coins. Unscrupulous jewelers used this opportunity to sell gold bars and coins for much higher prices and make some quick money.
From November 8th 2016 till today, the Government has made a number of rules…changes…flip-flops which have pretty much changed your life. Let’s take a look at some of these rules.
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Deposit your old 500 and 1000 rupee notes in banks till December 30th 2016
The Prime Minister says…You have earned money the honest way? You pay all your income taxes? You have nothing to fear. Just bring your old 500 and 1000 rupee notes and deposit them in the bank, within December 30th 2016. What do unscrupulous citizens with a lot of black money do? They use Jan Dhan accounts of the poor to launder black money. Just two weeks after the note ban, more than INR 27,200 crores has been deposited into these bank accounts. How can the poor in our country, deposit so much money, so fast?
The Government suspects that Jan Dhan bank accounts of poor citizens, were being used to launder black money. Money laundering hides the source of money and makes the money appear legitimate.
What does the Government do? The Government says…you can deposit a maximum of INR 50,000 in your Jan Dhan account. The Government also says….From December 19th 2016, if you are depositing money more than INR 5,000 in your bank account in old 500 and 1000 rupee notes, you can do so only once. One person can deposit more than INR 5000 in old 500 and 1000 rupee notes in the bank account, only once. You also have to say…why you waited for so long to make the deposit. This move could stop money laundering in it tracks.
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The Government scrapped 500 and 1000 rupee notes on November 8th 2016. The Government then allowed you to use these old 500 and 1000 rupee notes at utilities like petrol pumps, milk booths and for certain other payments, only for 72 hours. The Government then extended the deadline by another 72 hours.
Some new utilities were also added. The Government then extended the use of these old notes for payment of utilities till November 24th 2016. The Government then said….Use old 500 notes to buy Petrol at PSU petrol pumps till December 15th 2016. Also pay highway toll at toll plaza’s till this date, using old 500 rupee notes..
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The Government set limits….The maximum amount you could withdraw from banks was INR 10,000 in a day. You could withdraw INR 24,000 in a week. This rule was then modified…Daily cash limits were removed. You could withdraw up to INR 24,000 in a week.
It’s your BIG DAY. The Government says… Families celebrating weddings can withdraw up to INR 2,50,000 in cash, from the bank. Only one (either you or parents), can withdraw INR 2,50,000 in cash, from the bank. This rule applies separately to the boy and the girl.
Yes…You have just seen some of the rules which were made by the Government after demonetization. But…December 30th 2016, is still some time away. Get ready for some more surprises along the way.
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