> Another point to note is that Indian elections are funded by a massive corpus of cash, and when you suddenly make all existing cash illegal days before the elections, you cause complete disarray in your own political opponents' camps.

As well in your own camp. Your cash is not different from your opponent's cash. Unless the cash you are using is unaccounted.

That is assuming your camp didn't already know about what was going to happen.

https://www.huffingtonpost.in/2018/06/22/amit-shahs-director...

All parties have to file Income Tax returns which also includes sources of income. Had BJP been the only party with enormous cash, they would've been flagged by the IT department.

That's because how cash gets rotated among the Indian masses. Your Pendalwalla and Micwalla accept cash. Your party workers, campaign workers, alcohol suppliers, biryani suppliers etc etc .. Take cash.

So please drop this 'Income tax return' bogey. Most of the political donations and spending is unaccounted. You don't pay taxes on things that don't exist on your books.

Everyone knew that no one had cash. Your Pendalwalla and Micwalla had to earn money. They would have readily accepted checks or other forms of payment. The real trouble is that a lot of political parties fund their campaigns off the books. They can pay only in cash because it is untraceable to them. Your Pendalwalla, alcohol suppliers and Micwalla got cash before so they took cash. You pay them in checks and they take it.

> You don't pay taxes on things that don't exist on your books.

Its not others fault that you keep your party funding off the books. No one asked you to. You can keep it on the books, pay the tax, and pay you vendors legally without issue. The restrictions were on cash, not on any of the other payment systems.

1. BJP income rose after demonetisation. Parties don't pay taxes but file return for exemptions, expenses, etc. You don't even have to reveal the sources. https://www.dailyo.in/politics/demonetisation-noteban-party-...

2. If a party already knew that demonetisation is coming, it could have acted accordingly. https://www.financialexpress.com/india-news/demonetisation-b...

3. Ruling party had an advantage on getting money, organisational structure, advertisement, etc, etc. Many vendors don't accept checks but real currency.

I agree generally but this assumes all those Pendalwalla, Micwalla, liquor suppliers are okay with doing their sales in black. That's not always the case. Especially just after a massive government exercise that fell hard on cash, these guys are less likely to accept tons of cash. So, considering all this I don't see how one party clearly benefitted.

Even the US government is accused of weaponizing the IRS to target political opponents. Do you really think the IT department in India would operate without interference?

Or you had priority access to the newly issued notes.