SB ORDER NO 12/2016

F. No. 116-11/2016-SB

Government of India

Ministry of Communication

Department of Posts (F.S. Division)

Dak Bhawan Sansad Marg

New Delhi- 110001

Dated: 8th November 2016

To,
All Heads of Circles/Regions
Addl. Director General, APS, New Delhi

Subject- Withdrawal of Legal Tender Character of existing Rs 500/- and Rs 1,000/- banknotes

Sir/Madam

In terms of Gazette Notification No 10/3/2016-CY.1 dated 8th November 2016 issued by Governmentof India, existing banknotes in the denominations of Rs.500/- and Rs1,000/- of Mahatma GandhiSeries issued from 2005 and also those issued prior to 2005, (hereinafter referred to as WithdrawnOld Series, WOS) shall cease to be legal tender in payment or on account at any place on the expiryof the 08th day of November, 2016 ( D day) except to the extent provided in the Notification. A newseries of banknotes (Mahatma Gandhi New Series) having different size and design, highlighting thecultural heritage and scientific achievements of the country including Rs. 2,000 notes, will be issued.Bank branches, Head and Sub Post Offices will be the agencies through which the members ofpublic and other entities will be exchanging the WOS banknotes for banknotes in other bank noteshaving legal character and bank branches, all post offices for depositing the WOS banknotes for crediting to their saving bank accounts, within a period from 10th of November,2016 till close of 30th of December 2016, as prescribed in the Government of India Notification. Therefore, HO/SO/BOs have to accord highest priority to this work. In order to enable the members of public andother entities to exchange or deposit their existing Rs 500/- and Rs 1,000/- notes, the following arrangements have to be made by the Post Offices:

1. Action to be taken on 9th November, 2016

i) November 9th, 2016 shall be a non-business working day for all Post Offices. However, all
POs will function on that day to carry out preparations for implementing the scheme as per
this circular.

ii) The WOS banknotes stocked in ATMs and Post Offices attached to the HO/SOs will have to
be called back forthwith. The HO/SOs will be responsible for recalling the WOS banknotes
from them.

iii) HO/SOs should hence take steps to stop issuing WOS banknotes through their branches,
and Infosys should stop their ATM network switch on 9th November, 2016. All ATMs will have
to be re-configured by Infosys to disburse only Rs 100/- and Rs.50/- denomination banknotes
until further orders.

iv) HO/SOs have to stock the ATMs with banknotes of Rs.100/- and Rs.50/- denominations and
these machines have to be configured to disburse a maximum of Rs.2000/- per card per day
till further instructions. ATMs will be made functional only after they are re-configured and
stocked with banknotes of Rs 100/ and Rs 50/ denominations. Postmasters may check the
same.

v) Every HO/SO/BO shall prepare and send to its Divisional Office, a statement in the format
provided in Annexure-1, showing details of WOS banknotes held by it as at the close of
business of D Day, including the stock of WOS banknotes recalled from ATMs, in SO/BOs
etc.

vi) Arrangement should be made by the post offices to promptly deposit these WOS banknotes
with the linked currency chest of Banks/HO/SOs and get the amount credited to their
account.

vii) All Post Offices should estimate their cash requirement and obtain from the linked currency chest, the banknotes of other valid denominations at the one and half time of requirement.

viii) Mahatma Gandhi New Series bank notes of Rs 500 and Rs 2000 denominations should not
be disbursed through ATMs until further orders.

ix) Information Material for educating the public regarding withdrawal of Legal Tender character of the WOS banknotes and salient features of the new banknotes released by RBI are
required to be used for public education.

x) The HO/SOs should identify the staff for managing the exchange counters and brief them
properly about the scheme and the procedure to be followed. A copy of the FAQ provided in
Annexure-5 may be supplied to the staff manning the exchange counters.

2. Action to be taken on 10th November, 2016

i) HO/SOs have to accord top priority to provide facility for exchanging / accepting deposits of
WOS banknotes but BOs shall only accept deposits by individuals or entities in their
own post office saving bank accounts and HO/SO will open additional counters to meet
the public demand and keep the counters open for extended ours, if necessary. Maximum
staff should be deployed for this purpose. If necessary, Post Offices may consider hiring
retired employees for a temporary period to take care of additional work load.

ii) Provision of Exchange Facility At Head Offices/ Sub Offices: Members of public can
exchange withdrawn old series (WOS) banknotes for banknotes having legal tender character
at all branches of public sector banks, private sector banks, foreign banks, Regional Rural
Banks, Urban Cooperative Banks and State Cooperative banks, Head Post Office/ Sub Post
Offices from 10th November 2016 to 24th November 2016, up to an aggregate amount of
Rs.4000/- per person against production of valid identity proof and filing up of a request slip
as prescribed in Annexure-2. Such exchange facility is also available to all other legal entities
/ organizations such as corporates, Government departments, Societies, NGOs, firms, etc.

iii) Deposit of WOS Notes into POSB Accounts:

a. There is no upper limit for depositing such WOS banknotes to credit of the account of the
tenderer. If the tenderer is having account with the same post office, he/she need not
submit any identity proof for depositing these banknotes to his/her account. However, if
he/she has account with another HO/SO connected to the CBS, the banknotes
tendered can be accepted subject to his/her submitting the identity proof.

b. In case the tenderer of the WOS banknotes is depositing the money in the account of
another person or entity, a letter of authority from the account holder and identity proof of
the tenderer are required to be produced. POs should retain a copy of the Identity Proof.
c. All legal entities / organizations such as corporates, Government departments, Societies,
NGOs, firms, etc. can deposit their WOS banknotes to their account without any limit. The
tenderer of WOS notes for such entities should carry his identity proof as indicated in
Annex-2 and a mandate/authority letter signed by the person authorized to operate the
account clearly indicating the name of the bearer, account number and denomination
wise details of the WOS banknotes for depositing the amount to the account.

3. Restriction on Withdrawal of Cash by Cheque / Withdrawal Slip:

Withdrawal of cash by cheque or withdrawal slip will be restricted to Rs 10,000/- per day at
HO/SO and Rs 5000/- at BOs up to the close of working hours on 24th November, 2016.
Such withdrawal will be further restricted up to Rs. 20,000 per week.

4. Reporting Mechanism

Each HO/SO exchanging banknotes in the denominations of Rs.500/- and Rs1,000/- shall
report at the close of business on each day starting from10th November, 2016 till the closure
of the scheme on 30th December, 2016 by email or Fax to their Divisional Office a statement
as per Annexure-3 showing the details of WOS Banknotes exchanged by it and the
respective Divisional Offices will aggregate these as per Annexure-3A and report to the
Divisional Office who will report to Regional Office who will in turn return the Circle Office and Circle Office to Directorate every day so as to reach by 8:00 pm to the control room set up at Directorate.

5. HO/SOs issue detailed instructions to the SO/BOs advising them to strictly adhere to the norms of the scheme and procedures laid down above. The staff at the Post Office level, particularly at the Counter, should be adequately sensitized. For this purpose, information as available at the website (www.rbi.org.in) may be used. Staff should familiarise themselves with the FAQ (as perAnnex-4).

6. Post Offices should make copies of information material (As available at Annexure-5,
Annexure-6 and Annexure-7) which will be circulated in a few hours and distribute these to the public.

7. CPMsG/PMGs should monitor the implementation of the scheme on a day to day basis through amonitoring cell headed by an Officer not below the rank of Director Postal Services, who will act as a Nodal Officer.