Seized new banknotes to be back in circulation

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NEW DELHI: What happens to new currency notes worth close to Rs 100 crore that have been seized sincedemonetisation, mostly in wads of Rs 2000, by agencies such as ED, the income tax department and police?

The ED has issued a directive to zonal units to deposit new currency notes along with all other currency seizures into bank accounts opened by the agency in different cities so that new notes are immediately brought into circulation.

ED director Karnal Singh said on Monday that he had earlier issued a circular directing that seized currency notes be retained in strong rooms along with other seized material. “We have been depositing these currency notes in our bank accounts so that they come into circulation and the general public is not inconvenienced,” he said.

The government has also asked the I-T department to deposit seized currency notes in banks. Earlier, agencies kept all seized material, including cash seizures, in their strong rooms as evidence till the case was adjudicated. The seized money was then deposited into the Consolidated Fund of India, said a senior I-T official. Sometimes I-T ca ses took years to resolve, till then all seized material was kept in safe lockers of the tax department, the officer said.

Post-demonetisation, the I-T department and the ED have made huge seizures of new currency notes. Just Tamil Nadu and Karnataka have accounted for seizure of more than Rs 60 crore in new currency notes.
The ED on Monday seized Rs 47 lakh in new notes of Rs 2,000 from the owner of an educational institution in Punjab. The agency is verifying his claims that the money was deposited by students as fees. In Kolkata, the I-T department seized Rs 21 lakh in new currency notes. In two other operations since Sunday, police in Thane and Nashik seized about Rs 50 lakh in new notes of Rs 2,000 each.