Demonetisation: 50 days, 74 notifications

Having announced the demonetisation scheme on November 8, the central government and RBI came out with a series of notifications and announcements during its execution period of 50 days that included several rollbacks.

By: Express News Service | Updated: December 31, 2016 9:41 am
demonetisation, demonetisation rules, demonetisation notifications, rbi rules, rbi notification, rbi cash rules, cash withdrawal limit, central government, narendra modi, modi goverment, cash crunch, rs 500 ban, rs 1000 ban, indian express news, india news, economy news As the demonetisation drive progressed, the country witnessed currency shortage, followed by long queues outside banks and ATMs.

RBI notifications

November 8

1) Nov 9 shall be a non-business working day for banks
# All ATMs, cash deposit machines, etc, shall be shut on Nov 9 and 10
# ATM withdrawal to be restricted to Rs 2,000 per day per card up to Nov 18. The limit shall be raised to Rs 4,000 from Nov 19
# Any person who is unable to exchange or deposit specified bank notes or SBNs on or before Dec 30 shall be allowed to do so at specified RBI offices or such other facility until a later date as may be specified by it

2) All public sector/private sector/foreign banks, RRBs, urban co-op banks and state co-op banks to remain closed on Nov 9. All ATMs will stay closed from Nov 08 midnight. ATMs may resume from Nov 11 upon recalibration to dispense Rs 50 and Rs 100 notes

November 9

3) Instruction to banks for changes in ATM
# Reopening of ATMs from Nov 11; Recalibration of ATMs to dispense Rs 100 and Rs 50 notes via ATMs;
# Withdrawal limit of Rs 2,000 per day per card;
# Readiness for dispensing and accepting new series of Rs 500 and Rs 2,000 notes

4) Banks to remain open on Saturday, Nov 12, and Sunday, Nov 13
# Instructions to authorised persons

5) SBN, referring to old Rs 500 and Rs 1000 notes, shall continue to be legal tender until Nov 11 for transactions such as:
# At international airports: For passengers up to Rs 5,000;
# For foreign tourists to exchange forex or SBNs, up to Rs 5,000

November 10

6) Cash withdrawal over the counter restricted to Rs 10,000 per day per subject to an overall limit of Rs 20,000 per week till Nov 24, after which it shall be reviewed

7) Payment Systems (RTGS, NEFT, cheque clearing etc) to remain open on Saturday and Sunday (Nov 12 & 13)

November 11

8) Government depts may be allowed to draw cash beyond Rs 10,000 in exceptional cases, only on production of evidence justifying their cash requirements in writing

9) Banks to report daily position on exchange of SBN

10) Authorised persons may issue pre-paid instruments to foreign tourists in terms of the instructions issued by the Department of Payments and Settlement System, RBI, in exchange of forex tendered

November 13

11) The limit for exchange raised from Rs 4,000 to Rs 4,500
# Daily ATM limit raised from Rs 2,000 to Rs 2,500
# Weekly limit raised to Rs 24,000 from Rs 20,000 with a daily limit of Rs 10,000
# Banks to maintain separate queues for senior citizens and Divyang persons. Separate queues for exchange and deposits.
# Business correspondents’ limit of dispensing cash raised to Rs 2,500

12) Banks to furnish daily data on cash withdrawals over the counter and via ATMs

November 14

13) District Central Cooperative Banks (DCCBs) can allow customers to withdraw up to Rs 24,000 per week till Nov 24. No exchange against SBNs or deposit of such notes to be entertained

14) Current account holders allowed to withdraw up to Rs 50,000 a week. Banks may deploy micro ATMs near village panchayat offices, police stations and military outposts, and govt depts, etc. Banks may enhance micro ATMs’ limits to at least Rs 50,000

15) Banks shall waive levy of ATM charges for savings bank customers

November 15

16) While exchanging SBNs, the bank branch and post offices to put indelible ink mark on the right index finger of the customer to identify that he/she has exchanged old notes only once

November 16

17) Anybody depositing over Rs 50,000 has to submit a copy of the PAN card

18) Banks to send daily report to RBI with details of SBNs. It has been observed that the banks are sending the reports with significant delay causing severe inconvenience in collation of data

November 17

19) Limit of exchange over the counter shall be Rs 2,000 from Nov 18

November 18

20) Withdrawal limit at PoS made uniform at Rs 2,000 per day across all merchant establishments

November 20

21) ATM withdrawal limit to remain unchanged till further instructions

November 21

22) Current account holders allowed to withdraw up to Rs 50,000 a week. Facility also for overdraft and cash credit accounts

23) As small borrowers may need more time to repay their loans, it has been decided to provide additional 60 days beyond what is applicable for the concerned regulated entity for recognition of a loan account as substandard for several kind of loans

24) Higher cash withdrawals allowed for weddings. Maximum Rs 2,50,000 allowed till Dec 30

25) Farmers allowed to draw up to Rs 25,000 per week. All current account holders allowed to withdraw Rs 50,000 in a week subject to certain conditions and the same extended to the traders registered with APMC markets/mandis. Such traders will be permitted to draw up to Rs 50,000 from their current accounts if compliant with KYC norms and operational for last three months or more

November 22

26) Cash withdrawal for wedding: It has been decided to modify the instructions contained in paragraph 2 vi (c) of the aforesaid circular, as under: A detailed list of persons to whom the cash withdrawn is proposed, together with a declaration that they do not have a bank account, where the amount proposed to be paid is Rs 10,000 or more. The list should indicate the purpose of proposed payments

27) Measures to incentivise e-payments:
# Enhancement in issuance limits for pre-paid payment instruments. The limit of semi-closed PPI enhanced from Rs 10,000 to Rs 20,000
28) Making cash available for rabi crop season – advisory to banks
# NABARD would be utilising its own cash credit limits up to Rs 23,000 crore to enable DCCBs to disburse crop loans
# Banks with currency chests advised to ensure adequate cash supply to DCCBs and RRBs. Branches in APMCs may also be given adequate cash to facilitate procurement

29) Few bank branch officials, in connivance with some miscreants, are indulging in fraudulent practices while exchanging SBNs in cash / accepting SBN deposits into account. Banks are, therefore, advised to ensure that such fraudulent practices are stopped forthwith via enhanced vigilance and take stern action against officials involved in such activities

November 23

30) Banks are advised not to accept SBNs for deposits in Small Saving Schemes with immediate effect

November 24

31) No over-the-counter exchange of SBNs permitted after midnight of Nov 24

32) Banks advised to ensure cash availability for pensioners and to ensure adequate supply at the military outposts for armed forces personnel

33) Banks may deposit SBNs directly with RBI offices under whose jurisdiction they are located

November 25

34) Banks may continue to allow their existing customers to withdraw cash from their accounts up to Rs 24,000 per week

35) Foreign citizens can exchange forex for Indian currency up to a limit of Rs 5,000 per week till Dec 15

November 26

36) All banks are required to maintain with RBI a CRR of 4 per cent of NDTL. Effective Nov 26, an incremental CRR of 100 per cent on the increase in NDTL between September 16 and November 11 will be maintained by all banks

November 27

37) Chest Guarantee Scheme for SBNs: A new scheme for depositing SBNs with designated currency chest at the district-level introduced, under guarantee agreement similar to the current facility at RBI offices

November 28

38) To allow withdrawals of deposits on or after Nov 29 beyond the current limits

39) To expand the ambit of the CGSS, banks operating currency chests may be allowed to operate CGSS if they have space in their currency chest or at the centre which is as safe and secure as a currency chest

November 30

40) Fully KYC-compliant Jan Dhan account holders may be allowed to withdraw Rs 10,000 from their account, in a month. Limited or Non-KYC-compliant PMJDY account holders may be allowed to withdraw Rs 5,000/ month

December 7

41) Withdrawal of the Incremental CRR: It is decided to withdraw the requirement of incremental CRR, effective December 10

December 13

42) Preservation of CCTV recordings: Banks are advised to preserve CCTV recordings of operations between November 8 and December 30, until further instructions

December 16

43) Rationalisation of customer charges for IMPS, UPI and USSD: It is decided that all participating banks and Prepaid Payment Instrument (PPI) issuers shall not levy any charges on customers for transactions up to Rs 1,000 on the IMPS and UPI systems. The above measures shall come into effect from January 1, 2017 and shall be applicable till March 31, 2017

44) Special measures up to March 31, 2017: For transactions up to Rs 1,000, merchant discount rate (MDR) shall be capped at 0.25 per cent of the transaction value. For transactions above Rs 1,000 and up to Rs 2,000, MDR shall be capped at 0.5 per cent of the transaction value

45) Permitting foreign citizens to exchange forex for Indian currency notes up to Rs 5,000 a week till December 31

46) PMGKY operational guidelines issued

December 19

47) Deposits of above Rs 5,000 into a bank account will be received only once during the remaining period till Dec 30. The deposits will be taken only after questioning depositors, on record, in the presence of at least two bank officials, as to why this amount could not be deposited earlier

December 21

48) RBI withdraws condition on depositing more than Rs 5,000 in old denomination notes in bank accounts

December 26

49) The government to provide a grace period of 60 days for prompt repayment incentive of 3 per cent to those farmers whose crop loan dues are falling due between Nov 1 and Dec 31 if such farmers repay the same within 60 days from the above period

December 28

50) It is decided to provide 30 days, in addition to the 60 days provided for crop loans; term loans for business purposes including agriculture loans

December 29

51) Based on feedback that some MSEs are facing temporary difficulties in carrying out their business due to cash flow mismatches, banks are advised that they may use the facility of providing ‘additional working capital limit’ to their MSE borrowers

December 30

52) Closure of the scheme of exchange of SBNs at banks on Dec 30. At the close of business on Dec 30, all banks should report information on collection of SBNs on Dec 30 itself in email
# All bank branches (other than those of DCCBs) are required to deposit the accumulated SBNs in any issue office of the RBI or a currency chest on Dec 31
# SBNs cannot form part of banks’ cash balances from close of business as on Dec 31

53) The daily limit of ATM withdrawal is raised from the existing Rs 2,500 to Rs 4,500 per day per card with effect from January 01, 2017. There is no change in weekly withdrawal limits

Central govt announcements

November 10

1) Old notes will be accepted for making payments towards fees, charges, taxes and penalties payable to the central and state governments and for paying utility bills till midnight of Nov 11

November 11

2) Existing exemptions may be extended until the expiry of Nov 14. The exemptions are extended for payment of court fees; payments towards utility bills

November 13

3) The issuance of the new series of Rs 500 notes has already commenced

November 14

4) Banks to increase cash holding limit of banking correspondents to at least Rs 50,000 each. To expedite recalibration of ATMs, a task force is being set up
# The existing exemptions for acceptance of old notes for certain types of transactions are being extended till Nov 24

November 15

5) Indelible ink shall be used for over- the-counter exchange
# Spurt in deposits in Jan Dhan accounts to be looked into closely

November 16

6) While exchanging the SBNs, banks and post offices would put indelible ink mark on the right index finger of the customer

November 17

7) Keeping rabi season in mind, the government asks banks to permit farmers to draw up to Rs 25,000 per week in cash from their KYC-compliant accounts
# Traders registered with APMC markets/mandis will be permitted to draw up to Rs 50,000 per week. Permit families celebrating weddings to draw up to
Rs 2,50,000 in cash
# The government reduces the limit on exchange of old notes across the counter in banks from Rs 4,500 to
Rs 2,000. This facility will be available only once per person
# Central government employees up to Group C will be given an option to draw salary advance up to Rs 10,000 in cash

November 18

8) There are some reports received that some people are using other persons’ bank accounts, including Jan Dhan accounts, to convert their black money into new denomination notes. It is hereby clarified that such tax evasion activities can be made subject to income tax and penalty. Also, the person who allows his or her account to be misused can be prosecuted for abetment under the Income Tax Act (I-T)

November 21

9) The government to allow farmers to purchase seeds with the old high denomination notes of Rs 500

November 23

10) NABARD has made available Rs 21,000 crore limit to DCCBs
# Public sector banks and some of the private sector banks have decided to waive the MDR charges till Dec 31
# Indian Railways decides not to levy service charges of Rs20 for second class and Rs 40 for upper classes on purchase of reserved e-tickets up to Dec 31
# Trai has decided to reduce USSD charges from the current Rs 1.50 per session to Rs 0.50 per session for transactions relating to banking and payments. The telecom companies have also agreed to waive the above 50-paisa USSD charge per session for the period up to Dec 31
# For ease of payment at toll plazas on National Highways, the Ministry of Road Transport and Highways is advising automobile manufacturers to provide ETC compliant RFID in all new vehicles

November 24

11) No over-the-counter exchange of old Rs 500 and Rs 1,000 notes after Nov 24. It is decided that all exemptions will continue till Dec 15. Payments for the transactions under all the exempted categories will now be accepted only through old Rs. 500 notes. Toll payment at these toll plazas may be made through old Rs 500 notes from Dec 3 and Dec 15

Foreign citizens can exchange foreign currency up to Rs 5000 per week.

November 28

12) Pradhan Mantri Garib Kalyan Yojana, 2016 (PMGKY) proposed where the declarant shall be required to pay total tax of over 49 per cent. Along with this, 25 per cent of the money of the depositor will be held as zero interest deposit for four years

November 29

13) To reduce the cost of PoS machines, the government has exempted such devices from central excise duty

December 1

14) Clarifying on the amendments in the Income Tax Act moved through the Taxation Laws (Second Amendment) Bill, 2016, the Ministry of Finance said that no “new provision” has been introduced with respect to tax on jewellery purchased from legal income. Tax authorities will not seize jewellery/ornaments up to 500 grams for a married lady, 250 grams for an unmarried lady and 100 grams for a male individual, even if “prima facie”, it does not seem to match with assesses’ income
# With effect from the midnight of Dec 2, petrol, diesel and gas outlets will be removed from the exempted category. Even exemption for purchase of air tickets at airports have been withdrawn

December 8

15) The finance ministry announces 0.75 per cent discount on purchase of petrol/diesel through digital means, and 8-10 per cent discount on online insurance purchase from public insurers. The government to bear transaction cost for citizens making e-payments to government departments. PSBs advised not to charge over Rs 100 as monthly rental on PoS machines. No service tax will be charged on digital transaction charges/MDR for transactions up to Rs 2,000 per transaction. For the payment of toll on National Highways using RFID card/Fast Tags, a discount of 10 per cent will be available to users in FY17
# RRBs & Cooperative Banks to issue 4.32 crore “RuPay Kisan Cards”
# 0.5 per cent discount to customers for monthly or seasonal tickets from January 1, 2017, if bought digitally

December 9

16) Exemptions given for usage of Rs 500 old notes are being withdrawn from the midnight of Dec 9

December 14

17) The finance ministry warned people against manipulating figures of income, cash-in-hand, profits etc. while revising earlier returns, adding fudging of accounts may necessitate scrutiny of such cases

December 17

18) The exemption from I-T is given only to registered political parties, subject to conditions that includes keeping and maintaining books of accounts as would enable the assessing officer to deduce its income therefrom; in respect of each voluntary contribution in excess of Rs 20,000, the party will have to maintain a record of contributor’s name and address.

December 19

19) Amounts exceeding Rs 5,000 in old notes can be deposited only once till Dec 30. Also, an opportunity has been given to make the payments towards tax, penalty, cess/surcharge and deposit under the PMGKY 2016 with the old notes.

20) For those with turnover of up to Rs 2 crore, the deemed profit would be 6 per cent of turnover if all business is conducted digitally

December 21

21) The government has issued a direction to all PSBs not to charge fees for transactions settled on IMPS and UPI in excess of rates charged on NEFT for transactions above Rs 1,000, with service tax being charged at actuals. For USSD transactions above Rs 1,000, a discount of 50 paise on these rates shall apply

(Text in bold denote rollbacks)
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