NEW DELHI: A majority of people took to digital mode of transactions to make the country cashless following the announcement of demonetization by the Prime Minister Narendra Modi on November 8 last year.
While the government’s efforts to curb black money has started showing its results, the practice of generation of unaccounted money and its investment has not stopped completely.
Last week, the New Indian Express reporter visited many wholesale markets in Delhi and talked to traders, chartered accountants, property dealers and others and it came out that despite all efforts by the authorities, black money operation still continues.
Even as the level of operation has come down drastically, but, it was revealed that people are still investing black money in gold, diamonds and lands and even in share markets through different ways.
A visit to Kutcha Mahajani—the wholesale jewellery market in Walled City area of Delhi revealed how easy it to buy diamond and gold with unaccounted money.
While the government has already relaxed the rule of making PAN details mandatory for purchase of more than Rs 50,000 by extending it to Rs 2 lakh, but, traders here were ready to sell any amount of gold without any proof.
Posing as a prospective buyer, this reporter visited some jewellers who admitted that it is business as usual in this market. “People from many parts of the country come here to buy gold. They come with cash and they don’t demand a genuine receipt, because this will attract additional tax. You can buy gold of any amount, we would not ask for any proof,” said a jeweller.
People in this market said that kachcha bill is the documentary evidence of business dealings in this market. “Business in such markets always goes on trust. A customer only gets hand-written bill on a blank piece of paper and this is enough,” said another trader.
Similarly, even as prices of real estate have come down in last one year, but, plots and lands are still selling at huge premiums in many parts of Delhi and in other cities as well.
“Prices of properties have come down but only of certain segments. You come to residential colonies of Delhi and see how market prices of lands are three or four times higher than the circle rates,” said Sunil Gupta, a West Delhi based property agent.
Gupta said that property is still a big source of investing the black money. “No doubt that the business has come down, but, it has not stopped. You would not get a piece of 200 sq meters of plot in Prashant Vihar or Pitampura in less than Rs 6 crore while the price of the same size of the land according to circle rate is about Rs 2.5 crore,” said Gupta adding that land and plots are still a big source of investing black money.
Similarly, hawala operation—the old illegal way to send money from one place to other across the country is still going on in many parts of the country.
Wholesale traders in Chandni Chowk area said that retailers from other states reach here to purchase goods and most of them don’t bring cash with themselves. Rather, money reaches from one place to other through Hawala channels.
“There are many reasons. Many businessmen don’t prefer to carry cash with themselves due to security reasons. They also avoid getting into tax net. Instead, they give commission (0.2 to 0.50 per cent) to hawala operator who transfer cash from one place to another safely,” said a trader.
A chartered accountant requesting anonymity said that people also invest unaccounted money in share market. “For black money, people generally use Demat accounts opened with the help of fictitious documents or somebody else’s documents,” he added.