Deposits in Jan Dhan deposits shrink to a fifth after govt’s warning

Inflows into the zero-balance Jan Dhan accounts have declined significantly after the government warned citizens against using these accounts for money laundering by black money holders with the total deposits in these accounts shrinking from Rs20,206 crore as of 15 November to Rs4,867 crore as of end-November.

The total deposits in Jan Dhan accounts, which stood at Rs20,206 crore in the first week after the 8 November demonetisation, dropped to Rs11,347 crore and Rs4,867 crore, respectively, in the second and third week, Central Board of Direct Taxes said in a statement issued on Wednesday.

Around Rs799 crore was deposited in these accounts in just two days on 1 and 2 December 2016, according to the CBDT.

The average per account deposit in Jan Dhan accounts between 8 November and 2 December stood at Rs13,113, which, according to the CBDT, is not alarming, given the need to bring all cash to banks.

The government had, on 18 November, set a cash deposit limit of Rs50,000 for the Jan Dhan accounts and had cautioned account holders against allowing misuse of these accounts through deposits of demonetised Rs500 and Rs1,000 notes.

While the 50-day window for depositing old Rs500 and Rs1,000 notes will remain open till 30 December, the government has warned people against letting out Jan Dhan accounts in the backdrop of reports that some people were misusing other's bank accounts to convert their black money into new denomination notes.

The Income Tax Department has identified local clusters and bank branches where the inflows of Jan Dhan deposits have been higher than usual, to investigate possible tax evasion.

Meanwhile, repots cited Rs514 crore accumulation in Jan Dhan accounts in Telangana in just 22 days post demonetisation, raising doubts that these accounts have been misused by black money holders.

As if 8 November Jan Dhan accounts in the state held a total of Rs958 crore deposited in them where as by 30 November (within 22 days) the amount in the Jan Dhan accounts reached Rs1,472 crore.

Besides that post demonetisation 60,000 new Jan Dhan accounts were opened in the state which raised the number of Jan Dhan accounts to 1.53 lakh.