Note ban brought Rs 3 lakh cr of unaccounted wealth into banks: Modi

Prime Minister Narendra Modi addressing the nation during the 71st Independence Day function at the historic Red Fort in New Delhi. Photo: PTI
Vowing to continue the crackdown on black money, Prime Minister Narendra Modi on Tuesday said that over Rs 1.75 lakh crore deposited in banks post note-ban and more than 1.8 million people with disproportionate income are under government scrutiny.

Addressing the nation from the ramparts of the Red Fort on the 71st Independence Day, he said: "Those who have looted the nation and looted the poor are not able to sleep peacefully today."

Demonetisation of old Rs 500 and Rs 1,000 notes last November, he said, has helped bring over Rs 3 lakh crore of hereto unaccounted wealth into the banking system.

"This is not government research, this is outside experts," he added.

Modi said that out of the money deposited in banks post note ban, over Rs 1.75 lakh crore is under scrutiny. "More than Rs 2 lakh crore black money has reached banks and now people depositing such money are being made to answer questions on their origin."

The move, he said, has checked generation of new black money.

"The result of this has been that this year, the new tax payers (filing returns) has more than doubled to 5.6 million. Last year this was 2.2 million. This is the result of fight against black money," he said.

Prime Minister Modi, who rode to power in 2014 on the promise of eliminating black money, said the crackdown on ill-gotten wealth will continue.

"More than 1.8 million people have been identified whose income is more than their declared wealth," he said. "And they have to answer questions on how they accumulated such wealth."

Of the 1.8 million, 450,000 people have come out in open and are seeking to amend their "mistakes," he said, adding that 100,000 had not paid income tax ever in past.

Recalling the steps taken by his government to unearth unaccounted and untaxed wealth, he said black money of over Rs 1.25 lakh crore has been detected in last three years which people were compelled to surrender.

Demonetisation, he said, was a step in that direction which achieved great success.

The move forced "the black money which was hidden to be brought to mainstream. Our effort was to get money into banks and make it a part of formal economy and we have done it successfully," he said.

Modi said in a nation where closure of a couple of companies would lead to debates on destruction of economy, more than 175,000 shell companies have been shut.

Black money holders hid their wealth behind the veils of shell companies, he said. "After data mining post demonetisation, we have found 300,000 such companies which are only shell companies."

Shell companies are non-trading firms used as a vehicle for various financial manoeuvres to avoid paying taxes.

"You will be surprised to know that there are 400 shell companies operating from same address. There was no enquiry and all of it was going on in connivance (between tax evaders and officials). And for this, I embarked on a fight against black money and corruption," he said.

Note ban, he said, got money into banks, which are now lowering interest rates.

Common man is getting money. "Bank are lending to poor at lower interest rates. This is all working to boost the country's economy," he said.

Modi stressed on digital payments to move towards less cash economy saying there has been 34 per cent increase in digital payments in last one year.

In nearly an hour long speech, Modi said the implementation of Goods and Services Tax (GST), that subsumed over a dozen central and state levies to weave India into one market, has been smooth.

"GST has shown the spirit of cooperative federalism. The nation has come together to support GST and the role of technology has also helped," he said.

Removal of check posts after implementation of GST has cut time for transporting goods by 30 per cent, he said.

The Prime Minister said for his government, good governance is about speed and simplification of processes.

"Our fight against corruption and black money will continue. We are working to bring transparency using technology," he said. "We are fighting corruption - for the bright future of India and the wellbeing of our people."

People responsible for "loot" of national wealth will have to give answers, he said. "Our fight against corruption and black money will continue."

Modi said changing demand and technology is altering the nature of job and his government wants to nurture youngsters to be job creators and not job seekers.

"We are taking the nation on a new track (of development) and are moving ahead with speed," he said, adding that the government was devoting significant attention to eastern states of Bihar, Assam, West Bengal, Odisha and Northeast.

"These parts have to grow further," he said.

Modi said he wants to create an India where poor have a concrete house, electricity and water. "An India where farmer does not have any worry and sleeps peacefully. An India where farmer gets double of what he sows."

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