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RBI imposes curbs on old note deposits exceeding Rs 5,000

RBI imposes curbs on old note deposits exceeding Rs 5,000

 | Updated: Dec 19, 2016, 05.53 PM IST

HIGHLIGHTS

  • RBI restricted deposits of old notes of Rs 500 and Rs 1,000 notes in excess of Rs 5,000 only once till December 30.
  • Under the PMGKY scheme, black money holders can deposit cash which will be subject to 50% tax and 4-year interest free lock-in

NEW DELHI: The Reserve Bank on Monday imposed stiff restrictions on depositing more than Rs 5,000+ in the scrapped Rs 500 and Rs 1,000 notes, mandating that it can be deposited only once per account till December 30, that too after explaining to bank officials the reasons for not having done that so far.

Stipulating that restrictive conditions will also apply on the cumulative deposit of such notes in a single account when it exceeds Rs 5,000+ , RBI said that defunct currency up to any amount can be deposited under the new black money amnesty PMGKY scheme.

"It has been decided to place certain restrictions on deposits of SBNs into bank accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana+ , 2016," RBI said in a notification.

Under the PMGKY scheme, black money holders can deposit unaccounted cash in account which will be subject to 50 per cent tax and 4-year interest free lock-in for the remaining 25 per cent of the amount.

RBI said old notes in excess of Rs 5,000 into a bank account will be received for credit only once during the remaining period till December 30, 2016.

"The credit in such cases shall be afforded only after questioning tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation," it said.

The explanation, RBI added, should be kept on record to facilitate an audit trail at a later stage. An appropriate flag also should be raised in CBS (Core Banking Solution) to that effect so that no more tenders are allowed.

However, old notes up to Rs 5,000 received across the counter will allowed to be credited to bank accounts in the normal course until December 30, 2016.

"Even when tenders smaller than Rs 5,000 are made in an account and such tenders taken together on cumulative basis exceed Rs 5,000 they may be subject to the procedure to be followed in case of tenders above Rs 5,000, with no more tenders being allowed thereafter until December 30, 2016," RBI said.

RBI said that equivalent value of specified bank notes tendered may 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.

"The equivalent value of specified bank notes tendered may be credited to a third party account, provided specific authorisation therefor accorded by the third party is presented to the bank, following standard banking procedure and on production of valid proof of identity of the person actually tendering," RBI said.

Following the demonetisation of Rs 500/1000 notes on November 8, government had allowed people to use such notes for certain public utility bill payment as well as for payment to government hospitals and asked them to deposit the amount in bank accounts.

The central bank said that now-defunct notes in excess of Rs 5,000 shall be credited to only KYC compliant accounts and if the accounts are not KYC compliant credits may be restricted up to Rs 50,000 subject to the conditions governing the conduct of such accounts.

The equivalent value of specified bank notes tendered may 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, RBI said.

"The equivalent value of specified bank notes tendered may be credited to a third party account, provided specific authorisation therefore accorded by the third party is presented to the bank, following standard banking procedure and on production of valid proof of identity of the person actually tendering," it added.

The above restrictions shall not apply to tenders of SBNs for the purpose of deposits under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016.

Meanwhile, in a notification Finance Ministry said: "There shall not be any limit on the quantity or value of the specified bank notes that are tendered for payment and deposit made under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016".


It further said that deposit of such notes collected between November 10-14, by the District Co-operative Central Bank shall be subject to RBI instructions.

Top Comment

First they tell dont rush...u have till 30th Dec to deposit...then they say oppps we goofed up...we r getting more money than we expected...lets stop the deposits coming into the bankA Park

Also such notes deposited by individual customers or by the Primary Agricultural Credit Societies complete audit check of the veracity of the Know Your Customer documents of the said individual or the members of the said Primary Agricultural Credit Societies shall be conducted by the National Bank for Agriculture and Rural Development.


"The linked currency chest to District Co-operative Central Banks shall give the exchange value for verified specified bank notes only and subject to usual checks relating to identification of fake Indian currency notes," the notification said.

TIMESOFINDIA
RBI imposes curbs on old note deposits exceeding Rs 5,000 Reviewed by sambasivan srinivasan on 6:38:00 PM Rating: 5

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