Post-currency withdrawal: To ease cash flow, states add to Centre’s measures

UP announced acceptance of scrapped notes for land registration till Nov 24

Written by Aanchal Magazine | New Delhi | Published:November 20, 2016 2:20 am
delhi, demonetisation, 500 rs, 1000 rs, black money, currency ban, private hospitals, delhi govt private hospitals, india news, indian express, In a move that has rattled the nation, Prime Minister Narendra Modi  abolished Rs 500 and Rs 1,000. (File)

While the centre has announced a series of exemptions to its decision to scrap old Rs 500 and Rs 1,000 notes ten days ago, a number of state governments have also stepped in with their version of exemptions to ease cash flow pressure. Uttar Pradesh government on Tuesday announced acceptance of old Rs 500 and Rs 1,000 notes for land registration till November 24. The state’s chief minister Akhilesh Yadav has also written a letter to Prime Minister Narendra Modi on November 11 asking for extension in deadline for acceptance of old currency notes at private hospitals, chemists and nursing homes at least till November 30.

The finance ministry had on November 8 notified a list of transactions for which the old high denomination currency notes did not cease to be a legal tender. The list included payments at government hospitals, railway ticketing counters, government buses, airports, petrol and gas stations and other government utility charges.

Uttar Pradesh government has said that land registration has been considered by them as a utility payment. Many have questioned the legal sanctity of such a move but finance ministry has so far not objected to it. Finance ministry officials said they are looking into the matter.

Maharashtra government has announced a slew of measures including removal of toll on all state roads and allowing free transport of 50 kg of vegetables per farmer on state transport buses till November 24, issuance of directions to private hospitals to accept cheques from patients in case of emergency treatment. The state government has also permitted old currency notes to be accepted in Marathi theatres, Maharashtra government’s minister Vinod Tawde had tweeted on November 15.

Apart from payment of all utility bills, the finance department of Maharashtra had notified issued notification on November 12 enabling VAT dealers to pay their dues (tax, interest & penalties) in cash including old Rs 500 and Rs 1,000 notes.

In Kerala, the government has stepped in to make arrangements for disbursal of wages to plantation workers through the district administration. Those managing plantations have been directed to hand over the wages to the district administration concerned and the district collectors would make arrangements to make the payments to the workers. The Kerala government had also asked the representatives from banks, who met the chief minister on Friday, to apprise the RBI and the finance ministry of the need to give the cooperative sector and the State treasury due importance in handling the crisis.

The Assam government on Thursday sent a missive to district authorities asking them to ensure that wages are paid to tea garden workers and that negotiation are actively undertaken for settlement of wages issues.

After the withdrawal of the Rs 1000 and Rs 500 notes, there was panic across tea estates in the state for wage payment as management of these estates struggled to procure the cash for the payment of wages.

States such as Maharashtra, Kerala and Tamil Nadu are learnt to have voiced their opposition to the RBI’s November 14 circular that banned the district central cooperative banks from providing any exchange facility against Rs 500 and Rs 1000 notes, arguing that these banks play a vital role in the rural economy and are the only banking options available to a majority of farmers and agricultural labourers in the hinterland.

Chhattisgarh government announced VAT exemption for point-of-sale (PoS) devices in a bid to support small merchants. Gujarat’s chief minister Vijay Rupani announced that essential services such as water, electricity, LPG connections will not be suspended and no interest shall be levied on late payments till November 24.

Andhra Pradesh government set up coordination committees having representatives from banks, post offices and police in all 13 districts of the state for crowd management at banks. Chief minister N Chandrababu Naidu instructed government officials to make buttermilk available for people in queues along with suggesting banks to issue tokens to people in queues.