The NDA Govt Cabinet on Wednesday Dec 28,2016 approved promulgation of an ordinance to impose a penalty, including a jail term, for possession of the scrapped 500 and 1,000 rupee notes beyond a cut-off.
The Cabinet headed by Prime Minister Narendra Modi also approved an ordinance to amend the RBI Act to extinguish the liability of the government and the central bank on the demonetised high-denomination notes to prevent future litigations.
Official sources said the ordinance has been cleared, but did not say if the penal provisions would apply for holding the junked currency after the 50-day window to deposit them in banks ends as of December 30 or after March 31, till which time deposit of old currency notes at specified branches of the Reserve Bank after submitting a declaration form is open.
The penalty for holding old currency in excess of 10 notes may include financial fines and a jail term of up to 4 years in certain cases
While announcing the demonetisation of the old currency on November 8, the government had allowed holders to either exchange them or deposit in bank and post office accounts.
While the facility to exchange the old notes has since been withdrawn, depositors have time until Friday to deposit the holding in their accounts.
Why has the government introduced the new ordinance?
With the new ordinance, the government hopes to push people who still are holding on hordes of demonetised Rs 500 and Rs 1000 currency notes to deposit them into banks
What will happen to people who possess demonetised notes after March 31st?
Post the new ordinance, if more than 10 old notes are found with anyone, they will automatically be punished with a four-year jail term and a fine of Rs 5000.
How will they deposit their money in the bank now?
They can deposit the money in banks till December 31,2016.After that, they have time till March 31,2017 to deposit their money with the RBI
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