There are many myths and facts, claims and allegations, in the air about – recently announced – demonetization scheme, under which the government of the day at the centre has banned all series of old notes of 500 and 1000 Rupees. This article tries to clear those Demonetization Myths and Reality.
It was a move so sudden that the average Indian was left gasping for breath. However, the overwhelming narrative of “short-term pain, long-term gain” and the PR speak of “surgical strike on black money” seems to have taken some of the sting out of the burn the tough decision has caused the country. There is a rising sense of optimism as this is seen as the beginning of the end of black money in the Indian economy.
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E – PROPERTY PASS BOOK, REAL ESTATE SURGICAL STRIKE, HOW TO REGISTER YOUR PROPERTY OR PROPERTIES IN E – PROPERTY PASS BOOK
Myth: E – PROPERTY PASS BOOK, REAL ESTATE SURGICAL STRIKE This message on WhatsApp has gone Viral.
E-Property Pass Book (EPPB): From 1/4/2017 all properties are invalid for one year. You can’t sell or buy any property until u register your properties in the E-Property Pass book.
EPPB will be linked with PAN, Aadhar online. Owner has to personally report with ownership proof to Sub Registrar office where spl officers will enter all your property details in EPPB.
Once it is entered in EPPB your properties will become yours. They will have one more spl counter for emergency sellers, mortgagers, buyers where they can do exchange of properties but with full details of all properties.
Upto 31/3/2018 all properties will be entered in EPPB. From 1/4/2018 Govt will take over the properties not entered in EPPB . Real Estate Surgical Strike on Black Assets! Forwarded as received.
Reality: There has been no authorized report as such now from the Government of India.
Income Tax Notice to those who deposited cash
Myth : Income Tax Notice sent by Siliguri department
The income tax (I-T) department has started cracking the whip on people depositing large amount of cash. Economic Times(ET) has got hold of notice sent by I-T department of Siliguri, enquiring of cash deposits made by people in State Bank of Sikkim from November 12 – 14 . Ref Economic Times
In the notice dated November 18 – signed by Norbu Bhutia, deputy director of Income Tax (Investigation) at Siliguri unit – the concerned party has been asked to appear before the deputy director on (or before) November 25 to explain the source of deposits, along with supporting documentary evidence. Also produce the books of accounts along with bills/ voucher of documents which would be useful to explain the cash deposit. The excerpt of notice is shown in image below. To see full notice click here or the image.
Income tax notice explain source of cash deposits demonetization
Other Myths
Myth: Cash Deposited will reflect in the Income Tax E-filing website.
Reality: Many have seen following message in Social Media The moment CASH is deposited into your Bank a/c , the amount will immediately reflect in new WINDOW of the I.T. Department. This is false.
Income Tax department has added a new window in their I.T. E-FILING WEBSITE Account with Cash Transactions as shown in image below. This was added in September,2016 though yes Govt has announced that details of Cash deposited in Excess of 2.5 lakh during the period 9.11.2016 to 30.12.2016 shall also be sought from the Bank.
Income Tax website account with Cash Transactions
Myth: The inconvenience of depositing old notes, and changing it with new notes, will last for few days; anyway, enough time has been given by Modi government to deposit old notes, i.e. until 30 December 2016.
Reality: The government has withdrawn about Rs 15 lakh crore worth of Rs 500 and Rs 1,000 denomination notes. All four currency printing presses are working full steam. However, even at this rate, it is going to be a herculean task for the central banking institution to replace the equivalent value by December. This is likely to go on at least until February/ March. In the year 2013, the government withdrew pre 2005 series of 500 Rupees note; keeping inconvenience to general public in mind, the note could have been exchanged from May 2013 to June 2016; and, thereafter, it can be still deposited at the offices of the RBI.
Myth: Demonetization Move will crush fake currency,
Reality: There were currency notes worth about Rs 5 lakh crore in circulation across the country, and according to the RBI, about Rs 400 crore of this was believed to be fake currency. S While the black money converted into white may come into the banking system, how much of the fake currency will get weeded out? If the fake currency is already in circulation, it only means that one or two of the notes that you or I deposit in the bank, will turn out fake.
The new notes will also reportedly come with a more secure design, making them easier to track and tougher to counterfeit. Contrary to reports, there does not appear to be a “tracker” on the Rs 2,000 note
Banks are expecting to get Rs 500 denominated notes by 18 Nov and they can start circulating them by Saturday, 19 Nov
Government Tweets on Demonetization Myths and Reality
In a series of tweets, the government cleared many demonetization myths that have been going around in Social media.
Myth 1: PM will address the nation again, announcing demonetization of Rs 100 & Rs 50 rupee notes.
Reality: Baseless; there is no intention of cancelling legal tender status of notes of any other denomination.
Myth 2: Information was leaked to select corporate houses and party members in advance.
Reality: Complete secrecy was maintained; no leakage of Government’s intention to any selection.
Myth 3: The Implementation cost is more than the benefits.
Reality: Parallel economy corrodes and eats into the vitals of the country’s economy, adversely affecting the poor and middle class more than others.
Myth 4: The demonetization move is only for the show. People will find other means to keep black money. Already industries and mechanisms are springing up to address this demand.
Reality: Enforcement agencies are keeping necessary watch; besides, amendments made also in Benami transactions Act and information sharing agreements with foreign government to check black money.
Myth 5: New notes have chip embedded in them to trace black money hoarders.
Reality: No such chips are embedded in the new notes.
Myth 6: The new Rs 2000 notes of inferior quality; their color comes off.
Reality: Currency notes have a security feature called intaglio printing. The first test for a genuine currency notes is to rub with a cloth; this creates a turbo-electric effect, transferring the ink color onto the cloth.
Myth 7: Next step will be to seal bank lockers & freeze gold, diamonds, jewellery.
Reality: There is no such proposal for sealing the bank lockers or freezing jewellery.
Myth 8- For withdrawal of own money, a person will be marked with indelible ink
Reality- Indelible ink marking will only be for cash exchange at bank counters and not for withdrawals.
Myth 9- India is not prepared for digital economy as only a limited number of Indians have bank accounts
Reality- Since the launch of Jan Dhan, in 2014, more than 25.5 crore bank accounts have been opened. Considering average family size of 4.5, almost every Indian family is covered by a bank account.
Myth 10- Future generation of black money will not stop.
Reality- With implementation of GST from 1st April 2017, strict benami properties laws, extinguishing of Mauritius round-tripping loophole , new Rear Estate sector laws, and fear of action setting in, future black money generation will be seriously curtailed.
Demonetization Myths vs Reality
Demonetisation will only solve part of the riddle, the government will have to carry out many other steps, such as checking tax evasion, implementing anti-graft laws and checking crime, to rid the country of black money.
Related articles:
- Giving Cash and Deposit money into Bank Accounts and Tax on Gifts
- Tax and penalty on Cash Deposit due to Demonetization
- Transactions reported to Income Tax Department
- Black Money : What is Benami Property and Benami Act?
- How to Exchange Rs 500 and Rs 1000 Notes ?
- New Rs 500 and Rs 2000 notes : Features,Comparison
Any other demonetisation Myth that you have come across? Do you think Demonetization drive will have some impact?
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