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India – Demonetisation fails to plug flow of dirty cash in polling states

Demonetisation appears to have failed to arrest cash flow in the ongoing assembly polls with cash seizures witnessing a massive jump across UP, Uttarakhand, Punjab and Goa.Though UP is yet to see four more phases of polling, cash seizures in the state stood at Rs 109.79 crore on February 18, three times the amount reported in the 2012 assembly polls.

Punjab, which is witnessing a three-cornered fight between Congress, SAD-BJP and new entrant Aam Aadmi Party, appears to have felt no crunch in terms of cash in circulation either. Seizures of “unaccounted“ money by EC and its flying squads across Punjab were five times the amount reported in the 2012 polls. Besides seizure of Rs 58.02 crore in cash (up from Rs 11.51 crore in 2012), 12.43 lakh litres of liquor worth Rs 13.36 crore (up from Rs 2.59 crore) and 2,598 kg of drugs worth Rs 18.26 crore were seized in the run-up to the February 4 poll.The drugs seizures were far less in worth as compared to 2012, when 53kg of confiscated narcotics was valued at nearly Rs 54 crore.

The 2012 figures in EC data sourced by TOI are of total cash seizures made in raids by police and surveillance teams during the polls, as is the case in 2017. In instances where the ori gin of the seized money is not satisfactorily explained, the amount is handed over to IT authorities and this means that, as compared to five years ago, the tax department will have more cases to handle this year.

Uttarakhand, where polling was held in a single phase on February 15, reported Rs 3.38 crore of cash seizures, up from Rs 1.30 crore in the 2012 assembly poll. The amount of liquor that was seized went up from 15,151 litres (worth Rs 15.15 lakh) to 1.01 lakh litres worth Rs 3.10 crore.

The story in Goa was no different. Cash seizures totalled Rs 2.24 crore, a 273% rise over Rs 0.60 crore seized in the run-up to the 2012 polls in the state. Liquor seizures across the state stood at 76,299 litres this time, valued at around Rs 1.07 crore.

“The massive and unpre cedented cash seizures from the poll-bound states prove that demonetisation has had no effect on use of money power in elections,“ said a senior EC official. “Even though EC, concerned that the RBI limit on cash withdrawals from banks and ATMs would handicap the candidates in spending up to the prescribed poll expenditure limit, pushed the RBI to relax these restrictions, the high cash seizures show that the withdrawal caps were hardly a deterrent for candi dates or political parties.“

Uttar Pradesh, where demonetisation and the resulting cash crunch are a key plank of non-BJP parties, has reported little impact on movement of black money unaccounted cash during the ongoing poll. Cash seizures made in constituencies that went to the polls in the first three phases alone have surpassed the total cash seizures from across the state in 2012. With four phases still to go, UP may see the highest cash seizure ever.

http://epaperbeta.timesofindia.com/index.aspx?eid=31804&dt=20170221

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Comment (1)

  1. K SHESHU BABU

    Despite tall claims of benefits of demonetization, the illegal money and other illegal practices did not stop. This indicates government should take stringent measures .

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