Currency Demonetisation and Future course of Indian Economy

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Yagnasri
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Re: Currency Demonetisation and Future course of Indian Economy

Postby Yagnasri » 16 Dec 2016 05:13

With regards to notes deposited in the banks:

1. As per the process, banks will have to verify etc. the notes and then deposit them in the RBI now. I have spoken with someone quite senior few days back, and he said that process alone will take 3/4 months are he has thousands of bundles to verify now.
2. Huge amounts of deposits are there which are from Co Op Banks and that cash is also being counted along with customer deposits.
3. Storage capability is seriously short now and I have asked him to use make use of the facility I have with his bank for the time being.

500s are now being given by ATMs in Mumbai also.

hanumadu
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Re: Currency Demonetisation and Future course of Indian Economy

Postby hanumadu » 16 Dec 2016 07:44

Manak Gupta ‏@manakgupta 13h13 hours ago
60,000 accounts have been identified by IT with more than 1 crore deposit...!! This is big..!!!!

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Re: Currency Demonetisation and Future course of Indian Economy

Postby shiv » 16 Dec 2016 07:44

Bart S wrote:
Not only that, but Indian cards have had 2FA and mandatory chip cards before many countries including the US.

All my cards were replaced with chip and RBI insisted with sites like Amazon that a 2 step authenticating procedure was necessary unlike the way Amazon used to store your card details and simply charge when you clicked on "buy"

30 minutes after I paid for Aero India 2013 entry pass using CC in Bengaluru I got an SMS that Rs 28,000 had been spent in buying Lufthansa tickets from Berlin to New York. I got the shock of my life - reported it instantly . Since then chip on card is normal.

My biggest concern now is my ATM/Debit card which comes with magnetic strip onlee. Can be spoofed. But my need to swipe debit card was low until demonetization after which I have used it for petrol. Will use Paytm henceforth.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby ragupta » 16 Dec 2016 09:22

maxratul wrote:X-posting from the poll thread

I have a take on this which I would like to share:
...
Secondly, the government has not spelled out in terms of policy what are the benefits of cashless economy, for consumers as well as small businesses. Just saying cashless is easy and next gen is not going to cause generational change - why cant an e-payment attract less service tax? why cant businesses selling essentials be given tax rebates for cashless transactions? why cant farm equipment and seeds/fertilizers be drastically subsidized if procured through e-payment? what are the real, meaty policy incentives to go cashless beyond mere sloaganeering and idiotic lotteries?



A counter argument will be made, only rich and well off has cards, and they are being rewarded, so it is govt of rich.
Only poor use cash and they are not getting benefitted.

No matter which was you take a look, things will be twisted.

Best to make sure whatever is decided is implemented successfully. Unfortunately implementation of such scale cannot be done in a day.
If people cannot bear little inconvenience, then there is no point in beating the chest and saying we should do this and that. In that case chalta hai attitude will go on.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby MohdKav » 16 Dec 2016 11:19

Yagnasri wrote:With regards to notes deposited in the banks:

1. As per the process, banks will have to verify etc. the notes and then deposit them in the RBI now. I have spoken with someone quite senior few days back, and he said that process alone will take 3/4 months are he has thousands of bundles to verify now.
2. Huge amounts of deposits are there which are from Co Op Banks and that cash is also being counted along with customer deposits.
3. Storage capability is seriously short now and I have asked him to use make use of the facility I have with his bank for the time being.

500s are now being given by ATMs in Mumbai also.


Process will take 3-4 months ? RBI has already started to sell destroyed notes as 'scrap' ( 3 weeks back ). Your person 'senior' dont seem to know much.
My friend's company has already bought the 'said destroyed notes' from RBI and is currently making 'plywoods' out of them. The amount of mis information on this page and absolutely one sided view on BR. I would suggest people read from page 1, how the ardent posters have changed the goal posts as you go along the pages. Businesses are down tremendously, sales are extremely poor. Rural and Tier 2 towns are the one's who are suffering more, as more and more people save money than spend. Everybody is quite unsure about the future.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Rishi Verma » 16 Dec 2016 11:22

maxratul wrote:X-posting from the poll thread

I have a take on this which I would like to share:
a. Namo is incorruptible ... 90%
b. Serious against black money offenders...10%
c. Man with a vision, building a modern economy...10%


Without going into the pros and cons or the completeness of the list.. This is first order thinking. At the very least the "lists" should be weighted. Going deeper it's time-varying, nonlinear, ...here once you assign the weights no further analysis is needed.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby wig » 16 Dec 2016 11:22

http://www.tribuneindia.com/news/nation ... 37436.html

No work, daily wagers rendered cashless
Mention "notebandi" and an agitated Lakhbir Singh walks towards us. He opens his wallet and shows a coin of Rs 2 and another of Re 1. This is all he has. It is almost sunset. Yet like him, many daily wagers gathered at Mohali's Madanpura Labour Chowk are still hopeful of finding work.
Lakhbir, who earns a living transporting goods on his horse cart, is surrounded by carpenters, porters and painters. On seeing a man approaching the chowk, they disperse in haste and gather around the potential employer.
Lakhbir says he doesn’t have money to feed his horse that is surviving only on grass. He has an injury on his hand. “I accidentally hurt myself yesterday while cutting grass. The doctor asked for Rs 50 for a tetanus injection. Since I have been without work since the past several days, I had no money,” he says.
We ask for his cellphone number. He says he doesn’t have a phone. "A week ago, my pregnant daughter-in-law fainted while standing in a queue outside a bank. The doctor, who said the foetus had suffered an injury, sought Rs 700. I mortgaged my cellphone to borrow money for her treatment,” he says, cursing the "good-for-nothing" government.
Not only in urban areas, but daily wagers in rural pockets too are reeling under the impact of demonetisation. Zora Singh Nasrali, president, Punjab Khet Mazdoor Union, says: " Rural labourers have been the worst-hit. During this time of year, there is little work in the fields. So, rural workers would visit nearby cities for work. Post-demonetisation, works in cities have come to a standstill. The rural workers have nowhere to go.”
Migrant labourers, who have neither identity cards nor bank accounts, continue to be paid in banned notes. For exchanging an old Rs 500 note, they are given Rs 400 and for the banned Rs 1,000 note, Rs 900. “Shopkeepers too exploit us. Even if we have a note of Rs 2,000, they force us to either spend the entire amount or make purchases from another shop,” claims Mahesh Kumar, a construction worker from Bihar. He curses the village 'mukhiya' back home for denying him and several others an identity card.
He says many workers employed at construction sites have returned home. “Owing to the cash crunch, most companies have halted work. How can we survive in such a scenario,” he asks.
“Modi Sahib has done well. He will surely deposit in our accounts the black money recovered by the authorities," he adds. Sunil Kumar from Bhagalpur shares his optimism. “I have heard that people in Ludhiana have already received the money,” he says innocently, provoking a hearty laughter.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Chandragupta » 16 Dec 2016 11:39

Bart S wrote:
JohnTitor wrote:
In Europe, the banks will not allow transactions outside the country without confirmation. For instance, when I come to India or go to another country, I login to the accuont and choose the countries/dates I will be and only then will transactions be allowed. If I go without telling them, they will call the embassy to confirm if I did indeed travel (though this usually applies to transactions totalling > $150 )

Further, if I am buying something from abroad, the bank will block the transaction and i will receive an automated call to confirm that i made that transaction, after which it is unblocked.

These are things India can and should implement - it enables safer cashless transactions and prevents fraud. I would have thought, with India's IT skills, these would be quick wins.


You seem to have an unfairly dim view of the Indian banking system. Fraud protection for international transactions is very much active on Indian bank cards as well, most people travelling internationally from India (frequent travellers) take care to inform the banks of the countries they are visiting and the dates, as a precaution. Otherwise your transaction can be blocked, and they also call you from the call center. It's good to notify them as a best practice so they add a note in their system since our mobile phone might not be reachable when that happens.

Heck, I have even gotten calls within 2 mins for using my card from India on a foreign website for a forex transaction.


Not only that, but Indian cards have had 2FA and mandatory chip cards before many countries including the US.


Most of the fraud management and prevention processes on Europe and American cards are outsourced to India. My unit used to do similar thing for virtual money for an Indian telecom, in my IT days. Let me just say that when it comes to any kind of cc or cheque fraud prevention and flagging, Indians are at the forefront.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby a_bharat » 16 Dec 2016 12:39

ANI ‏@ANI_news 54m54 minutes ago
If one has not linked his pan no. with his bank account then
balance of more than 5 lakhs can't be operated,have to fill form no. 60:RBI

ANI ‏@ANI_news 43m43 minutes ago
Deposits made after Nov 9 exceeding 2 lakhs, without having pan no will not be operated till linked to pan or submission of form 60: RBI

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Paul » 16 Dec 2016 12:42

So now media crooks and other RW buddjeevis have woken up and propounding my theory that axis bank has been money laundering for AAP.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby disha » 16 Dec 2016 13:08

MohdKav wrote:Process will take 3-4 months ? RBI has already started to sell destroyed notes as 'scrap' ( 3 weeks back ).


RBI has been selling destroyed notes as 'scrap' long time back to specific approved vendors. Earlier they were incinerating it at a specific site and now they are sending to Kerala, B'glore to your friend 72 times removed and my cousin 4 times removed for making plywood.

Where do you think all the 2/5/10/20/50/100 Rs notes also go once they are deemed to not fit for being in circulation? They too get 'demonetized for destruction'.

RBI will do due accounting for all the 500/1000 Rs. notes coming in and even more securely destroy it. They do not want the scrapped note meant for plywood come actually back as demonetized notes for exchange again. I do not trust my cousin 4 times removed.

I come from a Rural on one side of biradari and a Tier 3 town from the other side of biradari and no there is no suffering. Business is as usual. Of course., the game is on - who is in cardiac care unit of which hospital.

Everybody is quite sure of the future. Just had a conversation with a cousin 2 times removed from a Tier 2 town and the cousin is going around town with 5x100, 2x50 notes since last 2 weeks. No need to use it. 99.9% of his transactions are over e-cash. So the cousin is genuinely bemused on all the hoopla in the news media.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby maxratul » 16 Dec 2016 13:37

ragupta wrote:
maxratul wrote:X-posting from the poll thread

I have a take on this which I would like to share:
...
Secondly, the government has not spelled out in terms of policy what are the benefits of cashless economy, for consumers as well as small businesses. Just saying cashless is easy and next gen is not going to cause generational change - why cant an e-payment attract less service tax? why cant businesses selling essentials be given tax rebates for cashless transactions? why cant farm equipment and seeds/fertilizers be drastically subsidized if procured through e-payment? what are the real, meaty policy incentives to go cashless beyond mere sloaganeering and idiotic lotteries?



A counter argument will be made, only rich and well off has cards, and they are being rewarded, so it is govt of rich.
Only poor use cash and they are not getting benefitted.

No matter which was you take a look, things will be twisted.

Best to make sure whatever is decided is implemented successfully. Unfortunately implementation of such scale cannot be done in a day.
If people cannot bear little inconvenience, then there is no point in beating the chest and saying we should do this and that. In that case chalta hai attitude will go on.


My point was not about winning arguments in media, but on creating real, obvious benefits (announced as policy) which will make people gravitate towards ecash for selfish (not using the word in a derogatory sense here) motivations.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby maxratul » 16 Dec 2016 13:40

Rishi Verma wrote:
maxratul wrote:X-posting from the poll thread

I have a take on this which I would like to share:
a. Namo is incorruptible ... 90%
b. Serious against black money offenders...10%
c. Man with a vision, building a modern economy...10%


Without going into the pros and cons or the completeness of the list.. This is first order thinking. At the very least the "lists" should be weighted. Going deeper it's time-varying, nonlinear, ...here once you assign the weights no further analysis is needed.


sorry i fail to make any sense out of this.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby madhu » 16 Dec 2016 14:23

SC to pass order on use of demonetised Rs 500 notes
NEW DELHI: The Supreme Court said that it may pass some orders today on a plea seeking that demonetised Rs 500 currency notes be allowed to be used for some more time at places like hospitals and petrol pumps.
"We will see whether we can pass some orders today," a bench comprising Chief Justice T S Thakur and Justice D Y Chandrachud said when senior advocate Kapil Sibal sought an interim order on the issue. Sibal said that the use of demonetised Rs 500 notes has come to an end and some order needed to be passed.
Yesterday, the court had said that the Centre should adhere to its notification that allowed withdrawal of Rs 24,000 per week from bank accounts after demonetisation of high-value currency notes.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby shiv » 16 Dec 2016 14:58

MohdKav wrote:Process will take 3-4 months ? RBI has already started to sell destroyed notes as 'scrap' ( 3 weeks back ). Your person 'senior' dont seem to know much.
My friend's company has already bought the 'said destroyed notes' from RBI and is currently making 'plywoods' out of them. The amount of mis information on this page and absolutely one sided view on BR.

Your conclusion could also be misinformation. The notes already handed to the plywood maker may have been notes already in the possession of the RBI, fully accounted for and not deposited or seized notes.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Yagnasri » 16 Dec 2016 15:39

Most of us do not know many of the processes involved in many areas like cash management. We go to the bank and withdraw cash. Do we know how banks will have cash with them all the time? How much is costs to bank and public to keep such huge amount of cash on which banks have to pay interest to the depositors? I am not sure how many here every went into a Strongroom of a bank for other than operating their locker. Many here do not know that RBI/banks will have currency chests and what is the process to be followed for depositing money with the chests. With due respect, I know a bit about all that.

The Senior person is the one who deals with the cash/new note distribution to the City where I live, and I am sure some of the gurus here know which city I am talking about. Further, they also know I know a bit about the banking.

I can say that at present, there is no manpower or storage to handle the amount of notes which are now deposited in the banks as per the required process. In fact, I will be surprised if the entire work is done in 3 or 4 months. The cash will be deposited till December 30.12.2016 then it will be processed and then it will be dealt and lot of time will be taken for all this.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Rishi Verma » 16 Dec 2016 15:43

RunDTV headlines "breaking newj" that 5-judge panel will decide the legality of notes-ban.

By the time judges "decide" the old notes should have been burned. Then what...

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JayS » 16 Dec 2016 15:53

Rishi Verma wrote:RunDTV headlines "breaking newj" that 5-judge panel will decide the legality of notes-ban.

By the time judges "decide" the old notes should have been burned. Then what...


Looks like, the last resort for C-system to save their still unchanged old notes.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Singha » 16 Dec 2016 16:02

Form60 in lieu of PAN is a big loophole and scam. it should be done away with . PAN was rolled out around 1998. I recall applying for it then and getting to know of it on r2i in 2004 from a terminal at the IT office. there is NO REASON why those who operate bank a/c cannot get a PAN. it is fast and efficient and I have got PANs made for myself and wife with no trouble at all.

the Form60 should be closed down with a warning get your PAN within this period or your existing a/c will be frozen. for cash withdrawls or deposit make it mandatory to show PAN.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby AdityaM » 16 Dec 2016 16:24

Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.

Image

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Paul » 16 Dec 2016 16:38

Govt will force an ordinance. SC Baal bhi banka nahin kar Santa.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Rishi Verma » 16 Dec 2016 17:32

Special email created to divulge info on black money to the government.

blackmoneyinfo@incometax.gov.in

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Yagnasri » 16 Dec 2016 18:06

SC notice time seems to be total 9 weeks. By that time entire DeMo work would be over. What would SC do if it passes an order? I mean it can do nothing if it finds GOI notification is illegal because whatever is to be done is already done.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby shiv » 16 Dec 2016 18:10

AdityaM wrote:Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.

Is it possible that there are deliberate differences?

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Re: Currency Demonetisation and Future course of Indian Economy

Postby hanumadu » 16 Dec 2016 18:36

http://www.financialexpress.com/india-news/pune-jeweller-under-i-t-lens-for-rs-60cr-deposit-post-note-ban/475781/#.WFNWRPPEhmM.twitter

This guy was back dating sales and inflating sales like selling a carat of daimond for 4-5 lakhs :)

http://indiatoday.intoday.in/story/demonetisation-income-tax-raids-enforcement-directorate-banks-black-money/1/835739.html

A Punjab businessman was laughing all the way to the banks and his 85 accounts until the Enforcement Directorate caught up with him on Wednesday night as part of a crackdown on cash hoarders following the government's demonetisation drive.
Top revenue intelligence sources and insiders in the home and finance ministries say the currency switch is slowly finding public acceptance and people are aiding raiding teams with information about hoarders of new currency and those with bogus bank accounts and black money.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JayS » 16 Dec 2016 19:08

AdityaM wrote:Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.

Image


Exact same difference is there between two 500 new notes I have - different location of the silver thread. I cannot think of any logical reason why its like that.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JayS » 16 Dec 2016 19:16

Yagnasri wrote:SC notice time seems to be total 9 weeks. By that time entire DeMo work would be over. What would SC do if it passes an order? I mean it can do nothing if it finds GOI notification is illegal because whatever is to be done is already done.


If SC rules DeMo is illegal post Dec 31 and old notes would be legal tender again, those who still kept the old notes can take it out and get it exchanged with new notes or some other commodity like gold. Possible, right?? The thing is staged by some bigwigs (politicians et al) I would say, who simple cannot do anything with a large stash of money they have stored in some godown and must be trying this last ditch attempt. I hope GOI keeps a quick counter action ready just in case SC tries to be over smart. Govt still holds a lot of cards.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Rishi Verma » 16 Dec 2016 20:45

Of course the old winnie Kapil Sibal is arguing the case on behalf of one of the "petitioner" in Supreme Court against the DeMo. Interesting he is also the lawyer for Sahara Shri.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JwalaMukhi » 16 Dec 2016 20:47

The power to print money completely rests with the government and is fully vested per constitution. The Supreme Court has become a joke and it needs to be reconstituted, but that is different matter altogether. The judiciary is out of control and wants to become the executive, where no such provision exists. Supreme Court better stick to the likes of its most recent shenanigans, in specifying the length of the skirts the dancers in bar can wear in Mumbai or some such nonsense. An institution that has reduced to a political and secular tool. Less said the better.

Kejri and gang are quite. It seems that enough new bills in 2000 have been collected and the secular gang will instigate some violence. Goondas, rioters-for-rent can be now paid with all new denominations. The rate at which new denominations are being hoarded and some getting caught, points to that. Can expect some damage on the street in the coming two weeks, as last hurrah of the c-system. Do not know how much value it will add.But supreme court in its infinite wisdom will poke its nose where none warranted, citing some flimsy reason to cause some minor pain to the government.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby dsreedhar » 16 Dec 2016 21:00

Looking at the fraud going on, can the govt issue an order that anyone involved in such fraud will be tried of committing treason (financial terrorism) against state and invite severe punishment (10+yr jail)? Could that act as a big deterrent?

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Re: Currency Demonetisation and Future course of Indian Economy

Postby siddharth » 16 Dec 2016 21:04

JayS wrote:
AdityaM wrote:Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.

Image


Exact same difference is there between two 500 new notes I have - different location of the silver thread. I cannot think of any logical reason why its like that.

I do not know the exact reason why the silver thread is not in a constant position on the note, but in my hobby of collecting Indian currency I have noticed this very same thing even in the old 500 and 1000 note. If you hold a new bundle of the old (500/1000) notes in serial order and flip through them from beginning to end, you can see the thread zig zaging between two fixed points. It is a deliberately done thing as the case in the new notes, where my guess is that the thread moves between the Hindi and English legends.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby JwalaMukhi » 16 Dec 2016 21:10

dsreedhar wrote:Looking at the fraud going on, can the govt issue an order that anyone involved in such fraud will be tried of committing treason (financial terrorism) against state and invite severe punishment (10+yr jail)? Could that act as a big deterrent?

The biggest bottle neck and outdated dead weight institution is the judiciary in India. Once it reaches there, the culprits will spend lot of time outside punishment. With all these IT raids, the judiciary will be the slowest to provide the justice. So unless, there is overhaul in how the courts function, these cases will all become pending, as so many already are, with no end in sight. The concept of time-bound verdict and delivery of justice is lost on the courts and it mostly indulges in politicking.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Manish_P » 16 Dec 2016 21:53

Rishi Verma wrote:Special email created to divulge info on black money to the government.

blackmoneyinfo@incometax.gov.in


:shock:

Just a mail ID anybody can drop a mail to... is that it ?!?

No guidelines, templates ? No checks, no verification ?

I don't like the dude two floor above mine because he plays loud music late into the night. Can i give his address :twisted:

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Re: Currency Demonetisation and Future course of Indian Economy

Postby chetak » 16 Dec 2016 22:19

Image

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Re: Currency Demonetisation and Future course of Indian Economy

Postby anupmisra » 16 Dec 2016 22:30

JayS wrote:
AdityaM wrote:Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.

Image


Exact same difference is there between two 500 new notes I have - different location of the silver thread. I cannot think of any logical reason why its like that.


Not an expert but to my untrained eye I can spot at least half a dozen more.

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Austin » 16 Dec 2016 23:23

Deposit in bank a/cs of political parties exempt from tax

http://indiatoday.intoday.in/story/depo ... 36424.html

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Re: Currency Demonetisation and Future course of Indian Economy

Postby svinayak » 16 Dec 2016 23:26

JayS wrote:Even ₹2000 note has printing quality control issues. I compared 2 in my possession & found differences similar to the 500.


Exact same difference is there between two 500 new notes I have - different location of the silver thread. I cannot think of any logical reason why its like that.


The silver thread is part of the entire print sheet from which the notes are cut after the print

So the sliver thread is continuous thread and may not be even for each print note

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Re: Currency Demonetisation and Future course of Indian Economy

Postby Picklu » 16 Dec 2016 23:48

However many security features are introduced, at the end of the day, it is pretty useless for one simple reason - the common folks can not distinguish a fake from a real one beyond a point. Even colour photocopies are being passed around. Once a common fellow gets a fake, the job of the counterfeiters are done. Because even if identified at the later stage, the common fellow won't go to the bank, police or authority for he will loose that much money for a higher denomination note. Loosing Rs 500 or 1000 is no joke for most of the people in India.

Once on a trip, the driver of my car got a Rs 500 fake from a road side dhaba, he didn't realize at that point of time. The next time he tried to use it, the shop keeper identified the fake. The driver cursed his fate (but was quite nonchalant to my surprise) and used the fake note coolly in a petrol bunk where he purchased more than Rs 3000 worth of fuel. The way he treated the situation, he has faced it before and it is quite common among fellow drivers. I asked him why he did not approach authority and he said that the best case for him would be just to loose Rs 500, worst would be jail time.

Hence, adding more and more security feature will have marginal value. The only practical solution is to keep Rs 100 as the highest denomination since that will reduce the reward for the counterfeiters to below acceptable.

pankajs
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Re: Currency Demonetisation and Future course of Indian Economy

Postby pankajs » 16 Dec 2016 23:55

http://indianexpress.com/videos/news-vi ... etisation/
Supreme Court Refuses To Interfere With Centre’s Policy On Demonetisation

The Supreme Court in its interim order on demonetisation, refused to interfere with the Centre’s decision firmly underlining that “these are matters of fiscal policies{Monetary policy but theek hai}. The court further restrained all high courts from examining the issue, stayed proceedings there and transferred them to itself. Stressing that the government is the best judge, the court also refused to extend dates for exemption of old Rs 500 and Rs 1,000 currency notes for certain services. After referring questions related to the policy to a five-judge constitution bench, the court said the government should try its best to honor commitment on weekly withdrawal of Rs 24,000 per person. The court had earlier asked the government how people were getting huge amounts of money in new currency referring to the seizures being made across the country.

Suraj
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Re: Currency Demonetisation and Future course of Indian Economy

Postby Suraj » 17 Dec 2016 00:02

JayS wrote:
Yagnasri wrote:SC notice time seems to be total 9 weeks. By that time entire DeMo work would be over. What would SC do if it passes an order? I mean it can do nothing if it finds GOI notification is illegal because whatever is to be done is already done.

If SC rules DeMo is illegal post Dec 31 and old notes would be legal tender again, those who still kept the old notes can take it out and get it exchanged with new notes or some other commodity like gold. Possible, right?? The thing is staged by some bigwigs (politicians et al) I would say, who simple cannot do anything with a large stash of money they have stored in some godown and must be trying this last ditch attempt. I hope GOI keeps a quick counter action ready just in case SC tries to be over smart. Govt still holds a lot of cards.

The legality of notes and currency series is within the RBI's powers to define, and is explicitly stated in Section 26.2 of the RBI Act, which is what GoI used here:
RBI Act of 1934
26. Legal tender character of notes.
...
(2) On recommendation of the Central Board the 6[Central Government] may,
by notification in the Gazette of India, declare that, with effect from such date
as may be specified in the notification, any series of bank notes of any
denomination shall cease to be legal tender 7[save at such office or agency of
the Bank and to such extent as may be specified in the notification].

GoI has done this exactly by law. Others have mentioned that prior notifications were made by ordinance, but that's a procedural precedent and not law - the basic legal requirement has been met as per Section 26.2 .


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