FAQs on Withdrawal of Legal Tender Character of the existing Bank Notes in the denominations of Rs. 500/- and Rs. 1000/-

1. Why is this scheme introduced?

The incidence of fake Indian currency notes in higher denomination has increased. For ordinary persons, the fake notes look similar to genuine notes, even though no security feature has been copied. The fake notes are used for antinational and illegal activities. High denomination notes have been misused by terrorists and for hoarding black money. India remains a cash based economy hence the circulation of Fake Indian Currency Notes continues to be a menace. In order to contain the rising incidence of fake notes and black money, the scheme to withdraw has been introduced.

2. What is this scheme?

The legal tender character of the existing bank notes in denominations of ₹500 and ₹1000 issued by the Reserve bank of India till November 8, 2016 (hereinafter referred to as Specified Bank Notes) stands withdrawn. In consequence thereof these Bank Notes cannot be used for transacting business and/or store of value for future usage. These Bank Notes can be exchanged for value at any of the 19 offices of the Reserve Bank of India or at any of the bank branches or at any Head Post Office or Sub-Post Office.

3. How much value will I get?

You will get value for the entire volume of notes tendered at the bank branches / RBI offices.

4. Can I get all in cash?

No. You will get upto ₹4000 per person in cash irrespective of the size of tender and anything over and above that will be receivable by way of credit to bank account.

5. Why I cannot get the entire amount in cash when I have surrendered everything in cash?

The Scheme does not provide for it, given its objectives.

6. ₹4000 cash is insufficient for my need. What to do?

You can use balances in bank accounts to pay for other requirements by cheque or through electronic means of payments such as Internet banking, mobile wallets, IMPS, credit/debit cards etc.

7. What if I don’t have any bank account?

You can always open a bank account by approaching a bank branch with necessary documents required for fulfilling the KYC requirements.

8. What if, if I have only JDY account?

A JDY account holder can avail the exchange facility subject to the caps and other laid down limits in accord with norms and procedures.

9. Where can I go to exchange the notes?

The exchange facility is available at all Issue Offices of RBI and branches of commercial banks/RRBS/UCBs/State Co-op banks or at any Head Post Office or Sub-Post Office.

10. Need I go to my bank branch only?

For exchange upto 4000 in cash you may go to any bank branch with valid identity proof.

For exchange over 4000, which will be accorded through credit to Bank account only, you may go to the branch where you have an account or to any other branch of the same bank.

In case you want to go to a branch of any other bank where you are not maintaining an account, you will have to furnish valid identity proof and bank account details required for electronic fund transfer to your account.

11. Can I go to any branch of my bank?

Yes you can go to any branch of your bank.

12. Can I go to any branch of any other bank?

Yes, you can go to any branch of any other bank. In that case you have to furnish valid identity proof for exchange in cash; both valid identity proof and bank account details will be required for electronic fund transfer in case the amount to be exchanged exceeds ₹4000.

13. I have no account but my relative / friend has an account, can I get my notes exchanged into that account?

Yes, you can do that if the account holder relative/friend etc. gives you permission in writing. While exchanging, you should provide to the bank, evidence of permission given by the account holder and your valid identity proof.

14. Should I go to bank personally or can I send the notes through my representative?

Personal visit to the branch is preferable. In case it is not possible for you to visit the branch you may send your representative with an express mandate i.e. a written authorisation. The representative should produce authority letter and his / her valid identity proof while tendering the notes.

15. Can I withdraw from ATM?

It may take a while for the banks to recalibrate their ATMs. Once the ATMs are functional, you can withdraw from ATMs upto a maximum of ₹2,000/- per card per day upto 18th November, 2016. The limit will be raised to ₹4000/- per day per card from 19th November 2016 onwards.

16. Can I withdraw cash against cheque?

Yes, you can withdraw cash against withdrawal slip or cheque subject to ceiling of ₹10,000/- in a day within an overall limit of ₹20,000/- in a week (including withdrawals from ATMs) upto 24th November 2016, after which these limits shall be reviewed.

17. Can I deposit Specified Bank Notes through ATMs, Cash Deposit Machine or cash Recycler?

Yes, Specified Bank Notes can be deposited in Cash Deposits machines / Cash Recyclers.

18. Can I make use of electronic (NEFT/RTGS /IMPS/ Internet Banking / Mobile banking etc.) mode?

You can use NEFT/RTGS/IMPS/Internet Banking/Mobile Banking or any other electronic/ non-cash mode of payment.

19. How much time do I have to exchange the notes?

The scheme closes on 30th December 2016. The Specified banknotes can be exchanged at branches of commercial banks, Regional Rural Banks, Urban Cooperative banks, State Cooperative Banks and RBI till 30th December 2016.

For those who are unable to exchange their Specified Bank Notes on or before December 30, 2016, an opportunity will be given to them to do so at specified offices of the RBI, along with necessary documentation as may be specified by the Reserve Bank of India.

20. I am right now not in India, what should I do?

If you have Specified banknotes in India, you may authorise in writing enabling another person in India to deposit the notes into your bank account. The person so authorised has to come to the bank branch with the Specified banknotes, the authority letter given by you and a valid identity proof (Valid Identity proof is any of the following: Aadhaar Card, Driving License, Voter ID Card, Pass Port, NREGA Card, PAN Card, Identity Card Issued by Government Department, Public Sector Unit to its Staff)

21. I am an NRI and hold NRO account, can the exchange value be deposited in my account?

Yes, you can deposit the Specified banknotes to your NRO account.

22. I am a foreign tourist, I have these notes. What should I do?

You can purchase foreign exchange equivalent to ₹5000 using these Specified Bank Notes at airport exchange counters within 72 hours after the notification, provided you present proof of purchasing the Specified Bank Notes.

23. I have emergency needs of cash (hospitalisation, travel, life saving medicines) then what I should do?

You can use the Specified Bank Notes for paying for your hospitalisation charges at government hospitals, for purchasing bus tickets at government bus stands for travel by state government or state PSU buses, train tickets at railway stations, and air tickets at airports, within 72 hours after the notification.

24. What is proof of identity?

Valid Identity proof is any of the following: Aadhaar Card, Driving License, Voter ID Card, Pass Port, NREGA Card, PAN Card, Identity Card Issued by Government Department, Public Sector Unit to its Staff.

25. Where can I get more information on this scheme?

Further information is available on our website (www.rbi.org.in) and the website of the Government of India (www.finmin.nic.in)

26. If I have a problem, whom should I approach?

You may approach the control room of RBI by email or on Telephone Nos 022 22602201/022 22602944

GST rollout likely to be pushed to mid-2017 as India Inc seeks time

The government could be looking at rolling out the country's biggest indirect tax reform from mid-2017, realising that it may be an uphill task to have all the pieces for GST rollout in place by April 1, the start of the fiscal. 

The central Goods and Service Tax (GST) and integrated GST laws may make it through Parliament only in the budget session, not leaving much time for preparation for the industry. 

"All options are open... The target date is April 1 and effort will and effort will be to keep it," said an official, but added that the industry has sought six months for preparation from the time when the law and rules are finalised. 

The finance ministry has had a series of consultations with representatives of various sectors who were asked to give their views on being comfortable with a June or July, 2017 rollout. The government wants the industry to put its house in order soon after the final draft of the law are made public, said a second person privy to deliberations.

As GST is an indirect tax, a midyear rollout does not create much issues. It may be recalled that the negative list regime for service was introduced from July 1, 2012. 

Experts said it would be preferred if the new regime is rolled out after adequate preparation, even if it is in the middle of the year. "It can come in any quarter of the year if they are ready.... It is better to launch it after proper preparations," said S D Majumder, former chairman of Central Board of Excise and Customs.

The GST Council, chaired by finance minister Arun Jaitley with state finance ministers as its members, has to finalise the rates, base, exemptions, tax holidays, and administrative setup, besides the law and rules. 

All the open issues plus the law have to be ready well in time so that it can be introduced in the winter session, which usually begins in late November or early December. 

The law would then go through the parliamentary process, including vetting by a standing committee, before it is taken up for passage. State assemblies would then have to ratify state GST laws. 

Though IT firms are ready with their enterprise resource planning software, these would need to be tweaked in accordance with the final law. These would then have to be tested by the companies. 

"Industry needs to align its systems... with the GST law...This would require 6-9 months once the law is finalised," said Bipin Sapra, partner at EY. 

ET view: Don't delay 

Missing one more deadline will be unfortunate. True, for the switch to GST, Parliament has to pass the central GST and on IGST law, and states must pass state GST laws. The core issue will be agreement on rates of tax and working of GST Council. The govt must engage with states and Opposition to ensure the rollout on April 1. If it stretches into 2017-18, chances of its implementation would become slimmer. 

Read more at:

http://economictimes.indiatimes.com/articleshow/53818895.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Courtesy: The Economic Times 

PRESS NOTE BY CBDT

Amendment of Rules regarding quoting of PAN for specified transactions

The Government is committed to curbing the circulation of black money and widening of tax base. To collect information of certain types of transactions from third parties in a non-intrusive manner, the Income-tax Rules require quoting of PAN where the transactions exceed a specified limit. Persons who do not hold PAN are required to fill a form and furnish any one of the specified documents to establish their identity. One of the recommendations of the Special Investigation Team (SIT) on Black Money was that quoting of PAN should be made mandatory for all sales and purchases of goods and services where the payment exceeds Rs.1 lakh. Accepting this recommendation, the Finance Minister made an announcement to this effect in his Budget speech. The Government has since received numerous representations from various quarters regarding the burden of compliance this proposal would entail. Considering the representations, it has been decided that quoting of PAN will be required for transactions of an amount exceeding Rs. 2 lakh regardless of the mode of payment.

To bring a balance between burden of compliance on legitimate transactions and the need to capture information relating to transactions of higher value, the Government has also enhanced the monetary limits of certain transactions which require quoting of PAN. The monetary limits have now been raised to Rs. 10 lakh from Rs. 5 lakh for sale or purchase of immovable property, to Rs.50,000 from Rs. 25,000 in the case of hotel or restaurant bills paid at any one time, and to Rs. 1 lakh from Rs. 50,000 for purchase or sale of shares of an unlisted company. In keeping with the Government's thrust on financial inclusion, opening of a no-frills bank account such as a Jan Dhan Account will not require PAN. Other than that, the requirement of PAN applies to opening of all bank accounts including in co-operative banks.

l.	NATURE OF TRANSACTION	MANDATORY QUOTING OF PAN (RULE 114B)
		Existing requirement	New requirement
1.	Immovable property	Sale/ purchase valued at Rs. 5  lakh or more	i.   Sale/ purchase exceeding Rs.10 lakh; ii. Properties  valued  by  Stamp Valuation authority at amount exceeding Rs.10 lakh will also need PAN.
2	Motor vehicle (other than two wheeler)	All sales/purchases	No change
3.	Time deposit	Time deposit exceeding Rs. 50,000/-     with     a banking company	i.  Deposits with Co-op banks, Post Office, Nidhi, NBFC companies will also need PAN; ii. Deposits  aggregating  to  more than Rs.5 lakh   during the year will also need PAN
4.	Deposit    with    Post    Office Savings Bank	Exceeding Rs.50,000/-	Discontinued
5.	Sale or purchase of securities	Contract for sale/purchase of a value exceeding Rs.1 lakh	No change
6.	Opening   an   account   (other than   time   deposit)   with   a banking company.	All new accounts.	i.   Basic   Savings   Bank   Deposit Account excluded (no PAN requirement for opening these accounts); ii.   Co-operative   banks   also   to comply
7.	Installation     of     telephone/ cellphone connections	All instances	Discontinued
8.	Hotel/restaurant bill(s)	Exceeding Rs. 25,000/- at any one time (by any mode of payment)	Cash payment exceeding Rs. 50,000/-.
9.	Cash purchase of bank drafts/ pay orders/ banker's cheques	Amount  aggregating  to Rs. 50,000/-    or    more during any one day	Exceeding Rs. 50,000/- on any one day.
10.	Cash   deposit   with   banking company	Cash    aggregating    to Rs.50,000/-    or    more during any one day	Cash deposit exceeding Rs.50,000/- in a day.
11.	Foreign travel	Cash  payment in connection with foreign travel   of an amount exceeding   Rs.25,000/- at any one time (including fare, payment to travel agent, purchase of forex)	Cash  payment  in  connection  with foreign  travel  or  purchase  of foreign currency of an amount exceeding Rs.50,000/- at any one time (including fare, payment to travel agent)
12.	Credit card	Application  to  banking company/ any other company /institution for credit card	No change. Co-operative banks also to comply.
13.	Mutual fund units	Payment of Rs.50,000/- or more for purchase	Payment exceeding Rs.50,000/- for purchase.
14.	Shares of company	Payment of Rs.50,000/- or  more  to  a  company for acquiring its shares	i.  Opening a demat account; ii. Purchase or sale of shares of an unlisted company for an amount exceeding Rs.1 lakh per transaction.
15.	Debentures/ bonds	Payment of Rs.50,000/- or more to a company/ institution for acquiring its debentures/ bonds	Payment exceeding Rs.50,000/-.
16.	RBI bonds	Payment of Rs.50,000/- or   more   to   RBI   for acquiring its bonds	Payment exceeding Rs.50,000/-.
17.	Life insurance premium	Payment of Rs.50,000/- or  more  in  a  year  as premium  to an insurer	Payment exceeding Rs.50,000/- in a year.
18.	Purchase of jewellery/bullion	Payment of Rs.5 lakh or more at any one time or against a bill	Deleted and merged with next item in this table
19.	Purchases or sales of goods or services	No requirement	Purchase/  sale  of  any  goods  or services  exceeding  Rs.2  lakh  per transaction.
20.	Cash         cards/         prepaid instruments     issued     under Payment & Settlement Act	No requirement	Cash payment aggregating to more than Rs.50,000 in a year.

 (Courtesy: www.taxcorp.in)