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Demonetisation: No exchange of currency notes from tomorrow, exemption on old Rs 500 notes extended till Dec 15


In another drastic move initiated by the government, the government has decided to end the window for exchange of currency notes at banks effective midnight today. The move, government sources said, was taken in view of several complaints of the facility extended by the government following the demonetisation move.

In another development, the government has extended the deadline for use of demonetised Rs 500 notes for emergency services and basic amenities including fuel and pharmacies ends till December 15.

However, the extension will only apply to old currency notes of Rs 500. Demonetised Rs 1,000 notes will not allowed for legal tender, starting tomorrow. People with Rs 1,000 will have to deposit their notes into bank accounts.

“It has been observed that over the counter exchange of the old currency notes of Rs 500 and Rs 1,000 denomination has shown a declining trend. It has further been felt that people may be encouraged and facilitated to deposit their old Rs 500 and Rs 1,000 notes in their bank accounts. This will encourage people who are still unbanked, to open new bank accounts. Consequently, there will be no over the counter exchange of old Rs 500 and Rs 1,000 notes after midnight of 24.11.2016,” the government said in a statement.

The exemptions for certain transactions and activities till December 15 wherein payment could be made through old Rs 500 notes include –

* payment of school fees up to Rs 2000 per student in Central government, State government, Municipality and local body schools
* payment of fees in Central or State government colleges

* payments towards pre paid mobile top-up to a limit of Rs 500 per top-up

* purchase from Consumer Cooperative Stores will be limited to Rs 5000 at a time

* payment of current and arrear dues to utilities will be limited to only water and electricity. This facility will continue to be available only for individuals and households

* foreign citizens will be permitted to exchange foreign currency up to Rs 5,000 per week. Necessary entry to this effect will be made in their passports.

The decision to extend the deadline was taken after a review meeting chaired by Prime Minister Narendra Modi. The meeting was attended by Finance Minister Arun Jaitley and senior officials of the government.

Meanwhile, toll tax exemption on National Highways has been extended till December 2. This is the fourth time that the government has extended deadline for toll tax since the demonetisation move was announced. The earlier deadline was November 24 midnight.

The government, however, said that scrapped Rs 500 notes will be accepted at toll plazas on NHs from December 2 midnight to December 15.

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