Demonetisation: Rs 50,000 as penalty for possessing old notes after Dec 30?

Possession of old notes after December 30 may invite penalty of over Rs 50,000

The government is mulling an ordinance  to bring a new law under which possessing, transferring or receiving  over Rs 10,000 in banned 500 and 1,000-rupee notes post December 30 will be a punishable offence. 

Reports said that there could be a cap of holding no more than 10 notes of each after December 30 and violation of the rule could draw a fine of a minimum of Rs 50,000 or 5 times the amount in question -- whichever is higher, but there was no confirmation. There will be a criminal liability and a municipal magistrate will hear cases involving violation and decide on penalty.

Holders of such currency have an option to deposit them in RBI by March 31 but even that period may be curtailed, they said.O

Of the Rs 15.44 lakh crore worth of 500 and 1000 rupee notes in circulation on November 8, close to Rs 13 lakh crore have been deposited in accounts or exchanged for valid currency.

There was no official word on the move which is likely to come up before the Cabinet on Wednesday.

The ordinance may also extinguish the liability of the government and RBI towards the promise to pay the bearer of these notes their value because of a statutory requirement.

In 1978 a similar ordinance was issued to end the government's liability after Rs 1,000, Rs 5,000 and Rs 10,000 notes were demonetised by the Janata Party government under Morarji Desai.

The government had while announcing the demonetisation of the old currency allowed holders to either exchange them or deposit in bank and post office accounts. While the facility to exchange the old notes has since been withdrawn, depositors have time till Friday to deposit the holding in their accounts.

Under the Garib Kalyan Yojana, people have till March 31, 2017 to disclose their illegal wealth and pay 50 percent tax, while locking in another 25 per cent of the declared income for four years.