Centre says 'no’ to new window for banned notes

18 Jul 2017

1

The centre on Monday told the Supreme Court that granting yet another opportunity for holders of demonetised currency notes to deposit the old Rs500 and Rs1,000 notes in bank accounts will defeat the very purpose of the 8 November demonetisation – eliminating black money.

The Supreme Court had, on 4 July asked the centre and the Reserve Bank of India to consider granting people with ''genuine reasons'' a new window for depositing demonetised notes and return to it in two weeks' time.

The centre, in response, said any decision to reopen the window will ''defeat the very object of demonetisation and elimination of black money''. It also said that black money holders had enough time to think anew and cook up new ''genuine reasons'' for delay in exchanging the discarded notes.

''If a window is opened for further period, persons who are in possession of the Specified Bank Notes (SBNs) would have had sufficient time and opportunity to carefully plan the reasons and excuses for not depositing the SBNs within the permitted period which was till December 30, 2016,'' the union finance ministry said in an additional affidavit filed in the Supreme Court on Monday.

''Any number of benami transactions and user proxies for the purpose of producing and depositing SBNs would then arise… the departments would have great difficulty in deciding any genuine case from the numerous bogus ones,'' said the document, which includes a detailed list of the various ''malpractices'' that came to light post-demonetisation.

The affidavit was filed in response to a query from the court earlier this month. The court, on July 4, gave the Centre and Reserve Bank of India two weeks time to consider granting a window for ''genuine reasons''.

''You (Centre) cannot be allowed to deprive a person of his money if he couldn't deposit it due to some genuine problems. Consider giving a window to a genuine problem. What if someone is terminally ill and couldn't deposit the money,'' a bench of Chief Justice of India Justice J S Khehar and Justice D Y Chandrachud had said while hearing petitions challenging the government's notification which disallowed people from depositing old notes after a prescribed time.

The finance ministry has now told the court that a window of 51 days, barring closed bank holidays, was provided for exchanging old currency. Unlike in 1978, when there were only six days.

During this time, anyone could have deposited the notes in their possession, either in person or through their authorised agents, said the government, citing clause 2 of the 8 November notification which permitted deposit of the SBNs through third-party authorisation.

The petitioner had not given a valid ground on why the notes could not be deposited through an authorised person during this time, it added.

Giving details of the post-demonetisation crackdown on black money and tax evasions, the ministry said the Income Tax department conducted 1,100 raids / surveys and issued 5,100 notices for verification of high-value cash deposits made in bank accounts, between 9 November 2016 and 10 January 2017. The raids revealed cash and valuables worth over Rs610 crore, of which Rs513 crore was in cash (Rs113 crore in new currency), it said.

Besides, undisclosed income of over Rs5,400 crore was detected in the raids.

On 31 January this year, the department launched ''Operation Clean Money'' for e-verification of cash deposits made after 8 November 2016. More than 1.8 million persons who did not appear to be taxpayers were verified, and 0.378 million have been taken up for assessment and investigation, it said.

''Searches'' by the I-T department, between 1 April 2014 and 28 February 2017 had ''led to admission of undisclosed income of more than Rs36,051 crore… in addition to seizure of undisclosed assets worth Rs2,890 crore. ''Surveys'' conducted by the department during this period had also led to detection of ''undisclosed income of more than Rs33,000 crore,'' said the affidavit.

Business History Videos

History of hovercraft Part 3...

Today I shall talk a bit more about the military plans for ...

By Kiron Kasbekar | Presenter: Kiron Kasbekar

History of hovercraft Part 2...

In this episode of our history of hovercraft, we shall exam...

By Kiron Kasbekar | Presenter: Kiron Kasbekar

History of Hovercraft Part 1...

If you’ve been a James Bond movie fan, you may recall seein...

By Kiron Kasbekar | Presenter: Kiron Kasbekar

History of Trams in India | ...

The video I am presenting to you is based on a script writt...

By Aniket Gupta | Presenter: Sheetal Gaikwad

view more