New Delhi, Jan 28: Reserve Bank of India dismissed Election Commission’s appeal to relax weekly cash withdrawal limits for poll expenses meaning that candidates who are contesting in the upcoming elections in five states will have to rely more on digital payment systems or cheques.
“RBI has rejected the request,” said a person aware of the development. EC suggested that weekly limit of Rs 2 lakh over the current Rs 24,000 which was permitted for individuals.
These limits were urged after demonetization was announced. Media reports have narrated that this imposition may come to an end by the end of February as the flow of new currency will enter the market. The use of cash in elections is typically kept under close watch by tax authorities and election authorities.
The election account which is opened by the candidates for meeting poll-related expenditure is monitored by EC.
EC demands to extend the withdrawal limit of Rs 24,000 translated into a monthly withdrawal of Rs 96,000. That compares with the Rs 28 lakh that candidates contesting assembly polls in Uttar Pradesh, Uttarakhand and Punjab are allowed to spend on electioneering.
The limit in Goa and Manipur is Rs 20 lakh. The EC had taken a sympathetic view of candidates’ requests regarding cash withdrawals and made a formal request to the RBI.