India is reeling with new rules governing Rs. 500 and 1,000 notes.
Banks across India witnessed long queues on Thursday, the first bank working day after the government’s surprise move to demonetize Rupees 500 and 1000 notes.
From Thursday onwards, people can exchange old currency notes of Rupees 500 and 1000 at bank counters or deposit the money in their account.
People formed queues in front of banks hours before they started operations on Thursday, reported The Hindustan Times. As per the government order, a person can exchange up to Rupees 2,000 a day for now, and later Rs. 4,000 a day, at any bank branch or post office. They can deposit money into their account without any limit. But, a form has to be filled and the copy of identity proof has to be submitted at bank and post office counters.
Though many people supported the government’s move to curb black money, many of them complained of the inconvenience caused by the decision. While some bank branches ran out of cash within hours, the forms required for exchanging currency were in short supply in some other branches.
“This is madness… what if the Rs 100 notes finish at the bank, I will have to go to another bank, but that, too will have a long queue… Modi’s decision is good, but it is also troublesome,” Hitesh Bhagat, a Delhi resident told Hindustan Times.
Quarrels broke out in many places as some people tried to jump the queue. Police forces were deployed in many places to control the queue. Reports said that some banks in Uttar Pradesh turned away people without exchanging money.
The Union Government announced on Thursday that old currency notes of Rupees 500 and 1000 can be used to pay utility bills like water, and electricity, taxes, fines, and penalty to the central and state governments. The exemption is available until midnight of November 11. Earlier, the ministry of roads and transport had waived off tolls on national highways till November 11.
“Old Rs 500, 1000 notes to be accepted for payment of fees, charges, taxes, penalty to central and state governments, including municipalities and local bodies,” Economic affairs secretary Shaktikanta Das tweeted on Thursday. “Above facilities to be available until November 11 midnight. Records to be maintained,” he said.
Meanwhile, in a show of aggression, the Income Tax department started surveys in Delhi, Mumbai, and other major cities in south and north India to trace large deposits made in banks in the wake of demonetization of high denomination currency.
The Indian Express reported that authorities have received actionable inputs about some traders, jewelers, currency exchanges and hawala dealers exploiting the situation by changing currencies at discounted prices. The Income Tax department will collect the details of people and entities making huge deposits and initiate action against them if their deposit does not match with their income as in the annual information reporting (AIR).
Meanwhile, airline companies and the Indian Railways, on Thursday, announced that flight and rail tickets booked using old notes of 500 and 1000 will be “strictly non-refundable and won’t be canceled.”
The decision on airfare was taken by Director General of Civil Aviation (DGCA) after noting the surge at airport counters to book tickets using old notes after the announcement of demonetization.
The government had announced that the notes could be used for purchasing air and train tickets. Many people tried to get rid of their unaccounted money by purchasing airline tickets and canceling the same later.
“We got instructions from the DGCA to do so. They, in turn, got their orders from the highest level of government (read PMO) as the relaxation was meant to ensure genuine travelers do not face hardships. This was not meant to be misused as an old-to-new note conversion trick,” a senior airline official told The Times of India.