Rs. 500, 1000 Notes Banned On RBI Suggestion, said BJP Law and IT minister Ravi Shankar Prasad.

“It is not demonetisation. It is a wrong expression. Our government has only taken decision upon recommendation of Reserve bank of India who is authority to take decisions that notes of Rs. 500 and Rs. 1000 will not be a legal tender. It is not demonetisation in classical economic sense,” he said.

Listing out steps taken by the NDA government to deal with menace of unaccounted money at an event of PHD Chamber of Commerce and Industry here, Prasad said Prime Minister Narendra Modi created SIT on black money in the very first Cabinet meeting.

The government re-negotiated double taxation treaties with Mauritius and Cyprus, and bankruptcy code was brought in. India also entered into an agreement with the US under FATCA.

“Then, provision under Income Tax was made to disclose black money and pay penalty, then voluntary disclosure income scheme was brought, then benami transaction rule was brought in. The decision of putting Rs. 500 and Rs. 1000 out of legal tender was last of these,” Mr Prasad said.

“Now this country is moving towards honesty and transparency let it move in that direction. Now it is our duty to bring India out of corruption taint,” Mr Prasad said.

The minister further said due to economic reforms government has saved Rs. 36,000 crore by digitalising economic activities such as payment of subsidies and MGNREGA wages through direct cash benefit facilities on to the accounts of intended beneficiaries through Aadhaar.