Demonetisation side effects: While you waited in bank queues for hours, here is where your money truly was

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Updated: December 9, 2016 5:17:19 PM

As the nation stands in queues for hours outside ATMs and banks, despite the RBI and the central government informing that sufficient amount of new notes being sent into the market, it has to be wondered as to why most of us have to go back home with empty wallets.

demonetistaion, it raids, income tax raids, income tax raids chennai, cheenai income tax, bengaluru income tax raid, axis bank riads, fake accounts axis bankThe I-T department is reported to have conducted 400 raids throughout the country nabbing a number of miscreants in the possession of a large amount of cash in new notes. (ANI)

As the nation stands in queues for hours outside ATMs and banks, despite the RBI and the central government informing that sufficient amount of new notes being sent into the market, it has to be wondered as to why most of us have to go back home with empty wallets. Well, raids by the Income Tax department reveal the answer. The I-T department is reported to have conducted 400 raids throughout the country nabbing a number of miscreants in the possession lakhs, crores in some cases, of money, stashed in the new denomination currency notes. More than 30 cases were referred to the Enforcement Directorate and the Central Bureau of Investigation for further investigation.

The Central Bureau of Investigation on Tuesday had booked a Karnataka Bank chief manager and a branch manager of the Dhanalaxmi Bank and a private cash logistics firm by the name of Secure India Value Ltd in Bengaluru for ”facilitating’ the laundering of unaccounted cash. The CBI had alleged them of diverting more than Rs 5 crore, which was meant for replenishing ATMs, in the new currency denomination notes of Rs 500 and Rs 2,000 to a group of 4 engineers and contractors. While this might be dismissed as just one case, common sense would suggest that given the number of raids and the availability of new notes in such abundance despite the RBI’s restrictions on withdrawal raises some serious questions.

Let us have a look at a few of the cases where the I-T dept, the police, the Crime Branch have raided and seized a large amount of cash in the new currency notes since demonetisation:

Bengaluru: 50 Income Tax officials searched through the city of Bengaluru and recovered Rs 5.7 crore worth of cash in Rs 2000 notes. In addition, 7 kilogrammes of gold bullion, worth at least Rs 2 crore was also recovered by the I-T department.

Surat: The Police on Friday arrested 4 people in the city carrying cash worth Rs 76 lakh in the new denomination notes. The matter is still under investigation.

Gurugram: The Crime Branch seized approximately Rs 10 lakh worth of new notes during a search operation in the region.

Mumbai: The Crime Branch has reportedly detained two people in Dadar in connection with the seizure if Rs 85 lakhs in new notes.

Chennai: This was probably the biggest bust since November 8 as the I-T department raided 8 locations in Chennai and seized Rs 100 crore in new notes and 100 kgs of gold.
Honorary mention: Axis Bank, Chandni Chowk branch, New Delhi: Since the demonetisation drive was announced on November 8, Rs 450 crores have been deposited into various accounts of the bank. Following a thorough survey of the bank by I-T department, Rs 100 crore of this amount was found to have been deposited in 44 fake accounts.

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It has to be understood that corruption is a fundamental problem. Although demonetisation would put an end to the legality of the stashed old notes, it cannot possibly stop the black income generation with the newly available currency notes. To counter these illegal transactions of the new currency notes, the government needs to be alert and constantly vigilant. And while the police and the I-T department, in general, have done a commendable job, it would not be too much of a stretch to say that all these busts might just be the tip of the iceberg.

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