Demonetization of Rs. 500 and Rs. 1000 currency notes by PM Modi on midnight of 8th Nov., 2016, aims to makes the India a cashless economy and curbing the flow of black money. This decision is taken for the poor—the farmers and laborers who are deprived and who are suffering. This decision will lead severe difficulties to the common man but it will take 50 days for the cash crunch to be over and the situation to normalize. This decision will affect those persons who hold huge amount of black money and benami properties.
Facility of exchange and deposits of old currency notes is given to the public and they can also deposit their money in Jan Dhan Account. The Jan Dhan Yojana was launched in August 2014 with an aim to bring the poor into the fold of banking facilities, and empower them financially by encouraging savings, and easing loan delivery and direct cash transfer. But a large amount of cash has suddenly started flowing into previously inactive Jan Dhan accounts in the aftermath of the demonetization of Rs 500 and Rs 1,000 notes. This is because of many black money holders has devised to deposit the demonetized notes in the bank account held by others likes relatives, servants, workers, poor people etc. Total amount deposited in Jan Dhan accounts rise to Rs 64,250 crore.
All such transactions are benami property transactions prohibited by the Amended Act and not only such cash deposits are liable to confiscation but all persons involved in such benami cash deposit transaction are liable for imprisonment of minimum one year which may extent to seven year and fine.
PM Modi’s next step aims to monitor and scrutinize the abnormal flow of deposits in bank accounts either saving, current or Jan Dhan Account.