RBI Imposes Curbs On Old Note Deposits That Exceed Rs 5,000

Deposits in excess of Rs 5,000 will only be credited once, and that too after the depositor is questioned as to why the notes weren’t deposited earlier.

The Reserve Bank of India headquarters in Delhi. Credit: Reuters/Files

The Reserve Bank of India headquarters in Delhi. Credit: Reuters/Files

New Delhi:  The Reserve Bank of India (RBI), on Monday, imposed stiff restrictions on depositing more than Rs 5,000 of the  scrapped Rs 500 and Rs 1000 notes, mandating that demonetised notes can be deposited only once per account till December 30, that too after explaining to bank officials the reasons for not having deposited the money earlier.

Stipulating that these restrictive conditions will also apply to the cumulative deposit of such notes in a single account when it exceeds Rs 5,000, RBI also said that defunct currency up to any amount can be deposited under the new black money amnesty Pradhan Mantri Garib Kalyaan Yojana (PMGKY) scheme.

“It has been decided to place certain restrictions on deposits of SBNs (specified bank notes) into bank accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016,” RBI said in a notification.

Under the PMGKY scheme, black money holders can deposit unaccounted cash into their accounts. This money will will be subject to a 50% tax, with 25% of the remaining amount be locked in for a 4-year, interest-free period.

RBI said old notes in excess of Rs 5,000 deposited into a bank account will be received for credit only once during the remaining period till December 30, 2016.

“The credit in such cases shall be afforded only after questioning tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation,” it said.

The explanation, RBI added, should be kept on record to facilitate an audit trail at a later stage. An appropriate flag also should be raised in CBS (Core Banking Solution) to that effect so that no more tenders are allowed.

However, old notes up to Rs 5,000 received across the counter will allowed to be credited to bank accounts in the normal course until December 30, 2016.

“Even when tenders smaller than Rs 5,000 are made in an account and such tenders taken together on cumulative basis exceed Rs 5,000 they may be subject to the procedure to be followed in case of tenders above Rs 5,000, with no more tenders being allowed thereafter until December 30, 2016,” RBI said.