Rs 2,000 notes form bulk of unaccounted cash: Nirmala Sitharaman

Finance Minister Nirmala Sitharaman said 43.22 percent of unaccounted cash seized in FY20 was in the form of Rs 2,000 notes. But the same number was over 60 percent in the previous two fiscals, indicating a declining preference for the note, Sitharaman said in a written reply to a question in the Rajya Sabha on November 19.

In FY18, the Rs 2,000 notes made up 67.91 percent of unaccounted cash, while the same figure was 65.93 percent in FY19.

Rs 2,000 denomination notes were introduced in November 2016 post-demonetisation when the Rs 500 and Rs 1,000 notes were scrapped.

The data, provided by the Income Tax Department, is based on an analysis of cases of cash seizures of over Rs 5 crore during the past three fiscals.

"To bring transparency in the source of funding to political parties, the provisions of section 13A of the Act have been amended to inter alia provide that no donations of Rs 2,000 or more shall be received otherwise than by an account payee cheque drawn on a bank or an account payee bank draft or use of electronic clearing system through a bank account or through electoral bonds," the Finance Minister said.

Recently, former Finance Secretary Subhash Chandra Garg said that Rs 2,000 notes can be demonetised without causing any disruption. He also said that majority of these notes are not in circulation since they are being hoarded.