Cabinet approves ordinance; jail-term for holding old currency post March 31, 2017

Cabinet on Wedneday passed an ordinance making it illegal for any citizen to keep demonetised notes of Rs 500 and Rs 1000 in their possession. 

People found with more than 10 old notes post March 31, 2017 can be liable for a four-year jail term or Rs 5,000 fine. An official who wished not to be named citing rules told reporters in New Delhi that the Ordinance will come in force from April 1, 2017.

PM Modi, on November 8, 2016, had said that people can go to banks and deposit this demonetised currency till Dcember 30, 2016 and at select Reserve Bank of India (RBI) offices till March 31, 2017. 

Govt approves ordinance making it illegal to hold old currency notes of 500/1000Rs post march 31.@ZeeBusiness

— Tabish Husain (@tabishh_husain) December 28, 2016

The ordinance has been brought to cancel the validity of these old notes. 

On November 8, 2016, PM Modi said that 86% of total currency in Rs 500 and Rs 1000 notes in circulation will be demonetised. The total value of this currency was around Rs 15 lakh crore. 

So far, over Rs 13 lakh crore has been deposited in banks with three days to spare. RBI's recent data show that nearly Rs 6 lakh crore have been withdrawn by people since November 10 to December 19, 2016. 

Media reports further said that any individual found with old currency in their possession after March 31, 2017 can be imprisoned.