Apparently it’s pretty normal for people to, say, claim they sold their house for 65% of its real value and in the meantime the buyer gives them a few suitcases to cover the remaining 35% so it never gets taxed.
To get around this the government planned this sting whereby they announced without warning that all 500 and 1000 Rupee notes weren’t legal tender and you had to bring them into the bank to exchange them for new 500 and 2000 notes or else deposit them. There’s a maximum you can exchange before they ask you to prove where the money came from and possibly fine/charge you for tax evasion.
Some people have just shredded the cash!
My colleague tells me one our testers was staying late in the office. He had a 500 rupee note to buy dinner on the way home and the news came in so that was that. Had to go home without any food!
I did ask about people using family members to split up their cash but it seems they’ll be using ID to cross-reference and could come back and prove you’re a tax cheat.