Jaitley flays Rahul; Congress says demonetisation knocked bottom off economy

The difference between Modi and Rahul Gandhi is clear -- the Prime Minister is thinking of the next generation while Rahul Gandhi is only looking at how to disrupt the next session of Parliament.

New Delhi, Jan 8: Hitting out at the Congress and its Vice President Rahul Gandhi, Union Finance Minister Arun Jaitley on Sunday said the party "sided with a status quo that is black money-friendly", adding that opposition protests on demonetisation were ineffective.

"There is a marked difference in the approach of the Prime Minister and his opponents. The Prime Minister is being futuristic, and is thinking of a more modern, technology-driven cleaner economy. He is now speaking of cleaning the political funding systems," Jaitley wrote in a Facebook post titled "Demonetisation -- A look back at the last two months".

"His opponents want a cash-dominated, cash-generating and cash-exchange system to continue. The difference between Modi and Rahul Gandhi is clear -- the Prime Minister is thinking of the next generation while Rahul Gandhi is only looking at how to disrupt the next session of Parliament," he added.

Claiming that there was no social unrest during the implementation of the November 8 demonetisation, Jaitley said the opposition protests have been "ineffective".

"The opposition disrupted a full session of Parliament. Their exaggerated claims on the disruption of the economy have proved wrong," he said.

"It is a tragedy that a national party like the Congress decided to adopt a political position, opposing both technology, change and reforms," he added.

Reacting to Jaitley's comment, Congress spokesperson Manish Tewari said: "Demonetisation has succeeded in doing something which possibly India's worst enemies could not -- knocking the bottom out of the Indian economy."

"If being futuristic means demolishing and destroying the economy by taking whimsical decisions, then it is better not to have such futuristic Prime Minister," the Congress leader added.

Describing the currency deposited with banks following demonetisation as money that has lost its earlier "anonymity", the Finance Minister said such deposits do not automatically become legitimate, and can now be identified with the owner for taxation purposes.

"The fact that large quantum of high denominational currency has been deposited with the banks does not render this money to be legitimate cash," said Jaitley.

"Black money does not change its colour merely because it is deposited in bank. On the contrary, it loses its anonymity and can now be identified with its owner," he said.

The Finance Minister said the Revenue Department would be entitled to tax this money.

"In any case, the amendment to the Income Tax Act itself provides that the said money, if voluntarily declared or if involuntarily detected, would be liable for differential and high rates of taxation and penalty," he said.

Jaitley's comments come after media reports earlier this week said that about 97 percent of the demonetised currency notes worth Rs 14.97 lakh crore have been deposited back as on December 30.

The Reserve Bank of India has clarified that such estimates may not be correct because the aggregating of accounting entries made at the various currency chests still requires to be reconciled with the actual cash balances in order to eliminate accounting errors and double-counting.

Jaitley said the large amount of cash with banks will strengthen the banking system, lead to lower interest rates and make more funds available for rural development and social welfare programmes.

IANS