Page 516 - SSB Interview: The Complete Guide, Second Edition

disburse only 100 rupee denomination notes, which made the
problem more acute.

c. The rate at which the massive network of ATMs was reformatted

for the new currency was very slow and painstaking.

d. The bank staff was at the receiving end of the customers’ wrath,

putting them under tremendous stress and strain.

6. Ordinance

The Specified Bank Notes (Cessation of Liabilities) Ordinance 2016 was
issued on 28 December 2016, ceasing the liability of the Government for

the banknotes and also imposing fines on people found carrying out
transactions or holding more than ten of them after 30 December 2016.

Fuel pumps, government hospitals, railway and airline booking counters,

state-run dairies and ration stores and crematoriums were allowed to
accept 500 and 1000 rupee notes until 12 December 2016.

7. History
Historically speaking, the demonetisation exercise has been carried out

in our country on two earlier occasions, once in 1946 just before

Independence and the second in 1978. The aim on both occasions was to
eradicate tax evasion by neutralising the unaccounted cash that was

stashed away outside the system. In 1978, denominations of 1000, 5000
and 10000 (the highest denominations ever) were declared void to curb

fake currency and unaccounted money which was fuelling a parallel

economy, effectively derailing the Government programmes and
financial policies.

8. Comments

The exercise was intended as a bold manoeuvre even at the cost of
massive public outcry and severe criticism from renowned economists.

There were arguably better options to tackle the intended targets.
Destabilisation of steady economic growth which resulted in the drop of