India withdrew the legal tender status of existing 500 rupee and 1,000 rupee bank notes this week in a shock move targeted at cracking down on fake currency and wealth hidden from the tax authorities.Queues formed as banks reopened after a one-day holiday and people tried to swap their old notes for smaller bills and for new 500 and 2,000 rupee notes, which are being rushed into circulation and are designed to be harder to forge.** The old bank notes can be exchanged for value at any of the 19 offices of the Reserve Bank of India, any bank branches or any head post office or sub-post office until Dec 30.** People can get up to 4,000 Indian rupees ($60) per person in cash when they exchange their old notes. Anything beyond that amount can be credited to their bank accounts. ** The notes can be exchanged at any bank branch, but only after showing a valid proof of identity such as a passport or driving licence.
** Some automated teller machines, or ATMs, started functioning on Thursday, after being shut for a day for recalculation. A maximum of 2,000 rupees on one card can be withdrawn from ATMs in a single day. That limit will be raised to 4,000 rupees from Nov. 19 onwards.** From bank branches, one can withdraw a maximum 10,000 rupees a day. The weekly cap is 20,000 rupees, including withdrawals from ATMs.
** The tax office will take note of deposits made above a threshold of 250,000 rupees in a bank account and will match it with the income declared by the account holders.
** In case of a mismatch, the tax office will ask the account holders to pay extra taxes plus a penalty of 200 percent of the tax payable.** Some banks have extended their hours to facilitate the exchange programme. All banks will remain open on Saturday, Nov. 12 and Sunday, Nov. 13 to help meet heavy demand.($1 = 66.3599 Indian rupees) (Compiled by Devidutta Tripathy; Editing by Mike Collett-White)
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Updated Date: Nov 10, 2016 22:15 PM