50 days of demonetisation: Common man suffering to continue amid cash crunch

The 50-day deadline for completion of demonetisation process draws near, and as promised by Prime Minister Narendra Modi in his televised speech on November 8, which the suffering of the common man amid the cash crunch will end in 50 days, is yet to yield results.

While the opposition claims the "demonetisation to be a mega scam, biggest one after independence," as said by West Bengal Chief Minister Mamata Banerjee; the Prime Minister in all his rallies post demonetisation has termed the drive as the war against the black money. Amid all these political statements, the plight of the common man continues to be the same.

Suffering to common men 

After 50 days post demonetisation  there in no ending to the lines outside bank queues. There is unlikelihood that ATM withdrawal limit will be exceed after December 30, the questions whether the exchanged limit at bank windows will be raised also remain hazy till date.       

While sections of economists and also credit rating agencies have given thumb up to the demonetisation drive, the process of implementation has been under criticism. IMF in its statement said that the implementation of the drive can be more 'prudent'. The government flip flop and norms changing have also attracted the irk of common man. 

Govt flip flop 

Finance Ministry and RBI in 50 days brought about 60 orders/notification/statements on note ban. Prime Minister Narendra Modi on November 8 justified the demonetisation drive saying that it will tighten the noose around black money holder, blackmoney, terrorism and counterfeit currencies and the problem will end in 50-days.

Here is how the Government has flip-flopped over its decisions pertaining to the demonetisation in last 50 days

Nov.08  Modi declares the Rs 500 and Rs 1,000 notes invalid. Exchange of currency up to Rs 4,000 allowed at banks, ATM withdrawal limited to Rs 2,000.

Nov 9: Old notes to be accepted metro stations, ASI monuments, toll plazas and medicine shops, petrol pumps, crematorium.

Government announced that now- defunct currency notes of 500 and 1000 will be accepted for making payments towards fees, charges, taxes and penalties payable to the central and state governments including municipal and local bodies, and other utility charges like water and electricity.

Nov.10  Banks reopen after a day. Massive queues ensue as millions line up to deposit or exchange old currency.

Nov.12  Deaths attributed to waiting in the queues begin to be reported. The Sensex registers the biggest single-day fall in nine months.

Nov.13  Currency exchange limit raised to Rs4,500 and ATM withdrawal to Rs2,500.ash exchange limit over the counter increased to Rs 4500.

Cash withdrawal limit at ATMs increased to Rs 2500 per day in the re calibrated ATMs.

The weekly limit for withdrawal from bank accounts increased to Rs 24,000, the daily limit is removed.

Nov. 14  Government extends existing exemptions for acceptance of old Rs 500 and Rs 1000 notes up to 24 November, 2016 midnight.

Nov.15  Banks asked to use indelible ink marks on those exchanging money; the election commission raises concerns.

Nov.16  Parliament session begins; opposition parties up the ante against the government over the suffering of the poor.

Nov.17  Currency exchange limit lowered to Rs2,000.

Cash exchange limit over the counter  reduced to Rs 2000.

Families allowed to withdraw up to Rs 2,50,000 from their own bank accounts, in case of a wedding.

Agriculture traders allowed to withdraw Rs 50000.

Nov.18  India’s Supreme Court says many are “frantic” over demonetisation.

Nov.22  RBI says banks have received Rs5.3 lakh crore in deposits since Nov.08.

Nov 21 To further support farmers for the current Rabi crop, the Government has decided to allow farmers to purchase seeds with the old high denomination bank notes of Rs.500 from the Centres(129 KB)

Nov 23 The Central Government takes various decisions for the benefit of farmers in the current Rabi Season and to promote digital payments in the economy

Nov.24  Old notes can now only be deposited at banks and not exchanged.

Old notes cannot be exchanged at banks. Only foreigners allowed to exchange currency up to Rs 5000 per week. Old notes of Rs 1000 cannot be used.

Government allows use of Rs 500 to pay for fuel, mobile recharges, water and power bills. Government-run school and college fees can also be paid with old notes of Rs 500.

Nov.27  RBI governor Urjit Patel justifies demonetisation, says the new notes are difficult to counterfeit.

Dec 1 Government clarifies that the apprehension sought to be created that the jewellery with the household which is acquired-out of disclosed sources or exempted income shall become taxable under the proposed Taxation Laws (Second Amendment) Bill, 2016, is totally unfounded and baseless

Dec 2 Demonetisation: Last day to use old Rs 500 notes at petrol pumps, toll plazas, air ticket counters.

Dec  9 Govt announces bonus , waiver service tax waiver below Rs 2000 to discount

Dec 13 RBI asks bak to maintain CCTV footage of transaction.

Dec 19 Deposit in old notes only once, or face officers.

Dec 21 RBI takes U-turn withdraws restriction on Rs 5,000 deposits for KYC compliant account holders.  

 

Dec 28:  Ordinance to deposit defunct notes. Modi Cabinet approves ordinance to penalise people holding junked Rs 500, Rs 1,000 notes.

Heavy tax penalty

Whats next

Black money holders will have to bear taxes and penalties amounting to as high as 137 per cent if they do not admit to or fail to explain the source of income after being raided, the income tax department said on Monday. However, the total levy can touch 107.25 per cent if the undisclosed income is admitted during search operations and that income substantiated, the department said in a release, adding the tax dodgers can come clean by paying 50 per cent on bank deposits post demonetisation.