THE Bengaluru police and Income Tax department find themselves in a peculiar problem over the scrapping of Rs 500 and Rs 1,000 notes. They are being flooded with tip-offs about people exchanging large amounts of old currency for others, for 20 to 40 per cent commission. However, officials are not sure what law they can act under.
With no valid provision available in the Indian Penal Code of 1860 to cover this, police have been largely passing along the information to the I-T authorities after seizing funds recovered on the basis of tip-offs.
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In the odd case where police have booked or arrested such individuals, it has been under sections 102 and 41 (d) of the Criminal Code of Procedure, 1973, which basically gives power to police officers to seize property that is suspicious in nature and to arrest without a warrant those in possession of such material.
Acknowledging the spurt in “these incidents” because of people “panicking” to get rid of money, Bengaluru Additional Commissioner of Police (West) K S R Charan Reddy said these do not fall under the definition of any cases in the IPC. “If the person who is giving the cash and the person who is taking the cash have no complaints, there is not much that can be done. Under the law it does not amount to a crime, like cheating, which is punishable under the IPC,” he said.
An officer attached with the intelligence wing of the IT Department said the “commission” scam was new for them too. “The department can act only under the IT Act in terms of verifying seized amounts of cash against the income of individuals it has been seized from,” the officer said.
Since demonetisation, police have handled as many as eight cases of old currency being exchanged for new ones.