Hyderabad: Farmers who turned millionaires overnight face prospect of losing lakhs

Bank officials at Vijayawada, Mangalagiri, Thullur and Guntur said that anxious farmers were doing the rounds at banks and asking officers how to deposit money without attracting penalty.

Written by Sreenivas Janyala | Hyderabad | Updated: November 14, 2016 2:32 pm
amaravati1 The exemption on capital gains tax for Amaravati farmers is yet to be declared by the Centre, so the farmers with cash in hand are facing a major loss.

Several farmers who sold their land in the Amaravati Capital Region in 2013-14 were left holding a lot of cash in their bank lockers. They are now hunting for friends and relatives who can accommodate deposits up to Rs 2.5 lakh in their bank accounts without attracting a penalty.

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Bank officials at Vijayawada, Mangalagiri, Thullur and Guntur said that anxious farmers were doing the rounds at banks and asking officers how to deposit money without attracting penalty.

Between October 2013 and March 2015, many farmers in the Amaravati Capital Region sold their lands amid reports that the new capital city of Andhra Pradesh would be established there, and land rates went through the roof. Land which earlier cost Rs 40 lakh per acre was sold at Rs 1 crore or more. At least 6,500 acres were sold.

However, as the state government fixed the registration value of land between Rs 8 and 16 lakh, about 95 per cent of the money was paid in cash. While most of the farmers parked the money by purchasing cultivable land elsewhere, building houses or buying luxury cars, some farmers deposited them in lockers or kept the cash in safes at home.

A Balaram Reddy, a real estate agent at Patamata in Vijayawada, said, “There is at least Rs 5 to 6 crore in cash belonging to farmers of villages under Thullur, Tadepalli and Mangalagiri mandals. The farmers, who became millionaires overnight, are running from one bank to another to find ways to exchange the demonetised currency or deposit it. Some are even approaching real estate agents. What can we do?’’

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An SBI official at the Mangalagiri branch said, “Some farmers were lucky that they opened multiple bank accounts during the land deal frenzy in 2014, when banks conducted drives to encourage customers to open accounts. Many of them have four or five accounts. Farmers are spreading the deposits in these multiple accounts. We witnessed a lot of that in the last two days.’’

According to Ramakrishna Reddy, MLA from Mangalagiri, “Some farmers preferred just one account as they wanted less complication. The farmers who accumulated money in bank lockers to use for marriages are doomed.” He added that his phone was constantly ringing as farmers from his constituency were seeking his advice. “They became rich overnight two years ago, and poor by a few lakhs on November 8 night,’’ Reddy said.

The exemption on capital gains tax for Amaravati farmers is yet to be declared by the Centre, so the farmers with cash in hand are facing a major loss.

However, a new business has begun in the villages of the region. Mokamatam Venkatesh, a real estate agent turned currency agent, in Inavolu village said, “Rs 300 commission for a Rs 1,000 note, Rs 150 commission for a Rs 500 note. That is the rate. We take your useless currency notes now and pay you back three months later. There will be nothing on paper; no signatures, no promissory notes, no bonds, etc. Just an assurance that you will get back your money minus the commission after three or four months.”

He added, “Business is good; many people who do not have enough bank accounts to deposit the cash without attracting penalty are my customers.”

“Agents are using accounts of Below Poverty Line (BPL) families, or accounts opened by people under various government schemes to receive benefits, to deposit the money collected from people with lots of cash,’’ an official said.

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  1. A
    Aryan.barb
    Nov 14, 2016 at 9:02 am
    Let the farmers suffer. This suffering should be compared with the sufferings of soldiers in the border. Those soldiers suffer everyday to save our blood-e barb-aryan-Pandits who came from western Iran. But these stupid lower caste farmers don't have any respect for blood-e barb-aryans.
    Reply
    1. S
      Satendra kumar
      Nov 14, 2016 at 1:42 am
      Good question for farmers who sold thier land for development and didn't buy anything.Firstly keeping tendered legal notes for myself is not constructive in the bank lockers secondly if deposited with all incursion chargers is very viable respect and honesty.The fault lines within yourself?The punter looser or winner the law have to decide.
      Reply
      1. M
        MyTake
        Nov 14, 2016 at 7:25 am
        Even if they sold land for cash why they could not deposit it in the bank instead of keeping in the safe? Does the note lay eggs in the safe?
        Reply
        1. M
          MyTake
          Nov 14, 2016 at 7:48 am
          Correct. Unless they give proper justification for doing so!
          Reply
          1. E
            End of
            Nov 14, 2016 at 11:26 am
            ha ha ha..mirchi lagii mirchi lagii..lol!
            Reply
            1. A
              Aravaazhi
              Nov 14, 2016 at 1:21 pm
              All over India, all those who sold Agricultural land for family needs this financial year or this month are in deep trouble. Even if the seller of an Agricultural land insist on white money, the maximum buyer pays is the amount which is equal to the guideline value and gives rest in black. Government must consider this issue.
              Reply
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                ashok s
                Nov 14, 2016 at 10:28 am
                5axed land buyers , investigation on land deals should be nx operation of pm. Both buyer and sellers should be not be spared . check account of ostwal builders in Mira road for example
                Reply
                1. A
                  ashok s
                  Nov 14, 2016 at 9:56 am
                  From where sir dhanajay got a fig of one cr is he working as peon in ostwal corp
                  Reply
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