Dear Professional Colleagues,
Taking nation by surprise, our Hon’ble Prime Minister Shri Narendra Modi Ji declared demonetisation of the existing Rs. 500 and Rs. 1000 notes to take them out of circulation as a measure to curb financing of terrorism through the proceeds of fake Indian currency notes and to eliminate black money. I am sure the measure would be a lethal blow to parallel economy that has casted long shadow on our real economy.
The writing on the wall is clear that the parallel economy needs to be curbed for the sake of national security and inclusive growth. In this regard, I look forward to the support of my fraternity. With your spread deep into the business and society, it is your duty to help the public and create proper awareness. Already there are misconceptions and rumours. You must assure people not to panic. With your incisive knowledge in the area of accounting and finance, you are best equipped to properly guide and assure the public. Help your clients and other individuals with the right knowledge.
Operational guidelines have been issued by the Ministry of Finance to deposit or exchange old currency with new currency. These guidelines are appended in this mail. There may be teething trouble for a couple of days, but it is beyond any doubt that the result would be worth the trouble.
As a partner in nation building, The Institute of Chartered Accountants of India welcomes the decision of Government of India. In recent times, it has been endeavour of Government to curb black money and bring back the national resources to mainstream. ICAI has supported these activities. I am happy that our contribution to the scheme of Income Declaration Scheme, 2016 was acknowledged by none other than Hon’ble Finance Minister, Shri Arun Jaitley Ji. I am thankful to my fraternity for their support in getting this recognition.
Now, it is another opportunity to showcase that we are partner in nation building.
CA. M. Devaraja Reddy
President,
The Institute of Chartered Accountants of India
Operational Guidelines
Source: Press Release issued by Department of Economic Affairs, Ministry of Finance, Government of India.
(http://finmin.nic.in/press_
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(i) |
Old High Denomination Bank Notes may be deposited by individuals/persons into their bank accounts and/or exchanged in bank branches or Issue Offices of RBI till the close of business hours on 30th December, 2016. |
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(ii) |
Old High Denomination Bank Notes of aggregate value of Rs.4,000/- only or below held by a person can be exchanged by him/her at any bank branch or Issue Office of Reserve Bank of India for any denomination of bank notes having legal tender character, provided a Requisition Slip as per format to be specified by RBI is presented with proof of identity and along with the Old High Denomination Bank Notes. Similar facilities will also be made available in Post Offices. |
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(iii) |
The limit of Rs.4,000/- for exchanging Old High Denomination Bank Notes at bank branches or at issue offices of Reserve Bank of India will be reviewed after 15 days and appropriate notification issued, as may be necessary. |
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(iv) |
There will not be any limit on the quantity or value of Old High Denomination Bank Notes to be credited to the account of the tenderer maintained with the bank, where the Old High Denomination Bank Notes are tendered. However, in accounts where compliance with extant Know Your Customer (KYC) norms is not complete, a maximum value of Rs.50,000/- of Old High Denomination Bank Notes can be deposited. |
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(v) |
The equivalent value of the Old High Denomination Bank Notes tendered can be credited to an account maintained by the tenderer at any bank in accordance with standard banking procedure and on production of valid proof of Identity. |
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(vi) |
The equivalent value of the Old High Denomination Bank Notes tendered can be credited to a third party account, provided specific authorisation therefor accorded by the said account holder is presented to the bank, following standard banking procedure and on production of valid proof of Identity of the person actually tendering. |
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(vii) |
Cash withdrawal from a bank account, over the counter will be restricted to Rs.10,000/- subject to an overall limit of Rs. 20,000/- in a week for the first fortnight, i.e., until the end of business hours on November 24, 2016. |
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(viii) |
There will be no restriction on the use of any non-cash method of operating the account which will include cheques, demand drafts, credit/debit cards, mobile wallets and electronic fund transfer mechanisms. |
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(ix) |
Withdrawal from ATMs would be restricted to Rs.2,000 per day per card up to November 18, 2016. The limit will be raised to Rs.4,000 per day per card from November 19, 2016 onwards. |
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(x) |
For those who are unable to exchange their Old High Denomination Bank Notes or deposit the same in their bank accounts on or before December 30, 2016, an opportunity will be given to them to do so at specified offices of the RBI on later dates along with necessary documentation as may be specified by the Reserve Bank of India. |
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(xi) |
Instruction is also being issued for closure of banks and Government Treasuries, on 9th November, 2016. |
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(xii) |
In addition, all ATMs, Cash Deposit Machines, Cash Recyclers and any other machine used for receipt and payment of cash will remain shut on 9th and 10th November, 2016. |
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(xiii) |
The bank branches and Government Treasuries will function from 10th November, 2016. |
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(xiv) |
To avoid inconvenience to the public for the first 72 Hours, Old High Denomination Bank Notes will continue to be accepted at Government Hospitals and pharmacies in these hospitals/Railway ticketing counters/ticket counters of Government/Public Sector Undertaking buses and airline ticketing counters at airports; for purchases at consumer co-operative societies, at milk booths, at crematoria/burial grounds, at petrol/diesel/gas stations of Public Sector Oil Marketing Companies and for arriving and departing passengers at international airports and for foreign tourists to exchange foreign currency at airports up to a specified amount. |
