[400notout]

Originally Posted by carwatcher

Dear friend this move was done by Govt only by way of giving license to PayTM and many other companies like Vodafone m-pesa as payment banks and which kind of woken up all the banks from their slumber and 'How to counter PayTM' was the single point agenda discussed very fiercely in their board meetings and now almost every bank has come out with their mobile-wallet.

Did you just seriously credit the Govt for PayTM? Its just a start-up like other startups. Its at the end a private company which exists to make money. I dont know why banks would be threatened as Paytm just uses the money which is transferred from you bank A/c. Like all other start-up ideas its nothing but a middle-agent. Also they do e-retailing ala flipkart.


I stand by my point.

Originally Posted by hothatchaway

Please read the income tax laws - http://incometaxindia.gov.in/Charts%...osecutions.htm it provides for rigorous imprisonment in certain cases.

Going by those laws half the population should be in jail. My question? when is the last time you heard someone went to jail for tax fraud? This might be a start but to get prosecuted the assessee must have screwed up really bad. There are tax raids every other time at all the usual suspects places viz jewellers, realtors, retailers etc. I expect lot of drama near december when advance tax will be declared and rest of the show at March end.

Originally Posted by hothatchaway

What they are doing is accepting what is no longer legal tender. Maybe they are otherwise straight shooters who will not have huge amounts to deposit. This however does not make it right. The restrictions are imposed for a reason and the expectation is that the common man supports it and not sabotages it.

The "legal tender" is a technicality.

Let me give you 2 scenarios

a) x pays 500 to a shopkeeper to buy Maggi and horlicks. Shopkeeper accepts it and deposits it.

b) y pays 30 lakhs cash to a builder who backdates the entry and makes a sale.

The technicality doesnt criminalise X but Y will have answers to give.

while the shopkeeper is not sabotaging, he is helping reduce cash crunch. While the builder is converting "black loot".

What I mean is these technicalities have exceptions in court of law. Dowry is illegal but what if my Father in law decides to gift me a car? And does this consensual exchange work in a drug dealers case? No. Your opinion is welcome.

Originally Posted by StarrySky

I have seen the line repeated many times that most of the black money is not stored as cash, but invested in real estate, gold etc. Now, if I have some black money and I buy real estate with it, I convert my black money to real estate, but the seller is now holding it in cash. So it exists as cash with someone else. What am I missing?

We dont love money. We love the things that it can buy for us. So different people will put their cash to different use. Money keeps changing hands albeit in different amounts. While one converts the Stash to land as it suits them, for someone else the same amount can be used to pay multiple people who can fragment it further. So a 1cr cash transaction can be fragmented to a 500 daily wage. Payments are made without a trace. Tax evaded. Hope this answers.

[StarrySky]

Originally Posted by mayankk

How will you do that now, after the fact??

It's a hypothetical question - based on the opinion seen in many places that "most of the black money is not held as cash".

Originally Posted by hserus

Money is white or black based on whether the possessor has accounted for it and paid tax on it or not. It isn't a skin colour sort of thing that it stays permanently white or black.

I agree with what you are saying, but it doesn't answer the question.

If somebody is taking black money (money that I have not paid tax for) from me, and he is ready to show it in his books and pay tax for it, then that's good. However, when somebody is knowingly/willingly taking unaccounted money (eg: in a land deal), I assume that he is most likely not going to account for it in his books either - it will remain black (unaccounted).

So, how true is the assertion that "most of the black money is not held as cash"?

Originally Posted by 400notout

We dont love money. We love the things that it can buy for us. So different people will put their cash to different use. Money keeps changing hands albeit in different amounts. While one converts the Stash to land as it suits them, for someone else the same amount can be used to pay multiple people who can fragment it further. So a 1cr cash transaction can be fragmented to a 500 daily wage. Payments are made without a trace. Tax evaded. Hope this answers.

I understand the payment can be split to multiple people. Yes, the government loses tax revenue on it, each time someone passes the cash on to another without accounting for it. If any of them in the chain are willing to account for it and pay tax on it (or avoid paying tax legally), then that portion of the money is no longer "black" at that point (in my understanding). What about the rest? Those currency notes passed as "black" are not getting destroyed. Somebody is holding it as cash somewhere down the line.

[carwatcher]

To be honest I have lost my energy to argue with you. Your use of smileys also indicate your seriousness. I give up.

But sincerely request you to go through this small article and especially the game-changer part.

http://www.thehindu.com/business/all...cle7561353.ece dated August 20, 2015

Originally Posted by 400notout

Did you just seriously credit the Govt for PayTM? Its just a start-up like other startups. Its at the end a private company which exists to make money. I dont know why banks would be threatened as Paytm just uses the money which is transferred from you bank A/c. Like all other start-up ideas its nothing but a middle-agent. Also they do e-retailing ala flipkart.

[400notout]

Originally Posted by StarrySky

I understand the payment can be split to multiple people. Yes, the government loses tax revenue on it, each time someone passes the cash on to another without accounting for it. If any of them in the chain are willing to account for it and pay tax on it (or avoid paying tax legally), then that portion of the money is no longer "black" at that point (in my understanding). What about the rest? Those currency notes passed as "black" are not getting destroyed. Somebody is holding it as cash somewhere down the line.

Attempting to answer. Some currency does turn to white, when some one deposits an insignificant amount in their account. The land purchased in cash results in loss of revenue to the Govt and is a permanent holding for the evader. He/she is answerable for cash but the land can be undervalued on paper. Lots of rich people purchase antiquities for cash and show them off as inherited family possessions. Thats crores of black money flushed into the market. Black money is generated at either the point of sale/purchase or when you take a bribe. So the generation is continuous. This becomes a game of passing the parcel where one collaborates with people willing to work/deal in cash. Now the Govt has just screamed STOP and the one with maximum cash in hand is frozen and afraid of getting caught. A move no one expected. So the people who already converted the stash to land /gold will have less to worry whereas the people who could not pass the parcel are trying ways to legalise or get rid of it.

Originally Posted by carwatcher

To be honest I have lost my energy to argue with you. Your use of smileys also indicate your seriousness. I give up.

But sincerely request you to go through this small article and especially the game-changer part.

http://www.thehindu.com/business/all...cle7561353.ece dated August 20, 2015

I am serious please ignore the smileys.

Thanks for the information. Didn't know that. But it does need a serious fillip now is the right time.

Back to back posts again sorry mods please merge

[akshay380]

Dont know if it's linked to this but seven biggies have been raided by IT in my town since last week. Let's see what comes out of this.

[SmartCat]

For the first time in India, the rich beg the poor to help them
http://www.smh.com.au/world/for-the-...17-gsrcuo.html

Maids, drivers, nannies, and cooks in India are experiencing unusual politeness from their employers. Beyond the work they do every day, they suddenly have another use – to launder the undeclared cash which the rich have been hoarding in steel wardrobes, under the mattress and in under-bed storage.

[hothatchaway]

Originally Posted by 400notout

Going by those laws half the population should be in jail. My question? when is the last time you heard someone went to jail for tax fraud? This might be a start but to get prosecuted the assessee must have screwed up really bad. There are tax raids every other time at all the usual suspects places viz jewellers, realtors, retailers etc. I expect lot of drama near december when advance tax will be declared and rest of the show at March end.

You are right, but the provision is there and am hoping that the amnesty this time isnt as generous given that enough opportunities have been given for hoarders to come clean

Originally Posted by 400notout

The "legal tender" is a technicality.

Let me give you 2 scenarios

a) x pays 500 to a shopkeeper to buy Maggi and horlicks. Shopkeeper accepts it and deposits it.

b) y pays 30 lakhs cash to a builder who backdates the entry and makes a sale.
The technicality doesnt criminalise X but Y will have answers to give.

while the shopkeeper is not sabotaging, he is helping reduce cash crunch. While the builder is converting "black loot".

In my opinion, even the shopkeeper can be brought to book under the negotiable instrument act. I know what you are alluding to and this is currently happening to beat the cash crunch, but let me ask you this, how certain are we about the books maintained by grocers and shopkeepers? Not to single out any particular region but this is particularly prevalent in the North where the habit of using cash has rendered the situation acute, most shopkeepers will discourage or decline outright if you offer to pay by debit/credit card and insist on cash. And am talking about tony areas of our national capital where there are large stores which do significant amount of business every month.

[diyguy]

Originally Posted by smartcat

http://www.smh.com.au/world/for-the-...17-gsrcuo.html

Sad article but may be reality. Here's the good that I have seen off this situation at least for the folks taking the money. I know a few folks who have used this to clear off their loans or credit card debt and get time to repay back at convenience, a lesser amount than borrowed, over the duration of a year.

[Sawyer]

Originally Posted by hothatchaway

- You may not be but those accepting old Rs 500/1000 notes after midnight of 8th Nov are. Let that be very clear and it will be good if you could also explain to those who think its still perfectly kosher.

This quote was in response to my statement that it is not illegal even today to accept the demonetised notes, for the reasons I have said so many times here, without any rebuttal from anyone based on existing laws and rules. In fact, every time I have asked to be told about exactly how it is illegal, by quoting a section from a law or a rule made under a law, there has been a thunderous silence.

And few understand the meaning of legal tender and what it means for a note to not be legal tender.

Here now in the quote above is a new word used with the hand waving: kosher.

Interesting word and it means the food that the Jews are allowed to eat. Why? Because of their religion, which more than any other religion is a religion of laws and practices. Laws written down thousands of years ago and practices as derived from the law by the rabbis - akin to case law that is the result of rulings by the courts in a country like India. What is kosher is specified in great detail in the holy book of the Jews - the Old Testament portion of what the Christians know as the Bible. Nothing other than what is written in the Old Testament, or by the subsequent rulings of rabbis on the subject, can be called not kosher.

So when casually saying this is not kosher, please specify like a Jew would by pointing to a law in his holy book or judicial ruling by a rabbi in the context of non kosher food, where accepting these notes is said to be not kosher. A news report, or a Minister saying this isn't good enough; for all the harm the British did to the country, they did us the big favour of leaving behind a country of laws, not one of firmans, decrees or dictats by anyone, no matter how powerful. Or just by the fact that everyone says so. That is mobocracy.

This whole matter of banning things in an unlawful way is getting out of control.

Moving on: even granting for a very hypothetical minute that the notes are legally banned, how would you react to this report in the Times of India?

The report is headlined: Rural calm away from city storm.
Quote from the report:
All this calm is because in most places, the demonetised Rs 500 and Rs 1000 notes are still good here. Most traders, restaurant owners and even locals do not flash a look of disbelief when you hand over one of the notes that were discontinued post November 8.
"What is the point in panicking? These notes are still money, at least till December end. We are not turning down customers who come to eat here just because they have old notes" said Hemant Kadam, owner of a popular restaurant....
" I have nothing to fear, I will walk straight to a bank with these notes and deposit them in my account. Why should people go hungry because of an announcement" declared another restaurant owner.
Traders of agricultural commodities, construction materials and retailers are also willingly accepting discontinued notes. Their only condition is that a buyer must not seek change, as it is in short supply.
Unquote

Do you seriously think anyone will go to these sensible people and wag their fingers at them saying: Not kosher?! Not I, for sure. I would go the restaurant for a meal and thank the owner for thinking straight, for being honest as well as civic minded.
Or, even more, do you think some one will round them up and put them in jail?!

Someone has already said this here: Those that do not learn from history are doomed to see it repeated.

As a concerned Indian, I hold no brief for any politician. But I would hate to see what may happen before all of the history gets repeated.

[maheshramaling]

Looks like the toll collection is suspended till 24th Nov.

http://www.financialexpress.com/econ...dnight/448268/

[sachinpk]

When the media is going the usual way of only highlighting the pit falls in the "demonitisation" drive, looks like the results are slowly coming out.
Fake note kingpin held
The arrest of FICN kingpin Tahir Sheikh has led them to believe that fake notes with crores in street value have already been destroyed in Bangladesh by FICN dealers.
Currency scammers face muted I-T raids
The officials are being extra cautious, though. The raids began a couple of days after the government scrapped Rs 500 and Rs 1,000 notes, and a full week on, they aren’t disclosing names. On Friday, an operation in Yelahanka yielded Rs 16 crore in unaccounted cash. The income tax department seized cash, gold and incriminating documents from a financier, an official said.

[sgiitk]

Originally Posted by 400notout

Did you just seriously credit the Govt for PayTM? Its just a start-up like other startups. Its at the end a private company which exists to make money. I dont know why banks would be threatened as Paytm just uses the money which is transferred from you bank A/c. Like all other start-up ideas its nothing but a middle-agent. Also they do e-retailing ala flipkart.

We dont love money. We love the things that it can buy for us. So a 1cr cash transaction can be fragmented to a 500 daily wage. Payments are made without a trace. Tax evaded. Hope this answers.

Agree on PayTM. There are many like them. Kanpur Electric Supply uses PayUMoney. One is about the same as the other.

Have you figured out how many day will 1cr take in 500 rupee tranches. I think it is something like 20,000 days, is over 50 years.

[SDP]

Originally Posted by Sawyer

....
Do you seriously think anyone will go to these sensible people and wag their fingers at them saying: Not kosher?! Not I, for sure. I would go the restaurant for a meal and thank the owner for thinking straight, for being honest as well as civic minded.
Or, even more, do you think some one will round them up and put them in jail?!
...

Hope you have seen this :
http://m.economictimes.com/news/econ...w/55502143.cms

For easy reference, attaching the image that has been doing rounds.


-----------------------------
I am not a lawyer and obviously don't understand the finer aspects of law interpretation.

Looking at the report, it seems like somebody who believes in your line of thinking (that its OK to deal with old and now invalid notes) just got a notice. I do understand that a notice doesn't mean he broke any law or he would pay penalty or he would go to jail. I am just highlighting the sheer amount of effort and time this gentleman is going to waste now to justify his action and intentions.

Summary - The question "is it legal or not" is important and is possibly a nice topic for Arnab Goswami's everyday shouting match. What is more important on ground is "do you want to consciously go against a 'guideline' (mind you, may not be a rule) that the Govt has just laid out?". Is it just a guideline or is it a rule/law... would get answered soon when the experts in the field choose to answer. The consequences of not following the 'guideline' would be additional hassles by way of having to answer to notices. So its up to each one of us to decide whether they want to take a idealistic stance "This is not illegal and I will fight it out" (this is assuming that what you are saying is right) or "Govt has laid out a guideline of not accepting the old notes for a reason. Let me follow that guideline ..if not for national interest, but at least for self-interest (i.e. not to invite any new trouble for self)"

[mayankk]

Originally Posted by SDP

Hope you have seen this :
------------SNIP----elf)"

IN agreement with why ask for trouble. However, this gent seems to have ben called in for the amount, and not the denomination. Doesnt a deposit above 2.5L(?) trip some switches for the government to warn them, as they have said?

[SDP]

Originally Posted by mayankk

IN agreement with why ask for trouble. However, this gent seems to have ben called in for the amount, and not the denomination. Doesnt a deposit above 2.5L(?) trip some switches for the government to warn them, as they have said?

The notice does say "cash deposits of above denomination" which I believe means he deposited the cash in old 500 and 1000 notes.