BLACK  CIRCULATION

We all have heard about Black Money we also know that Black Money is indulged with illegal people's or organisation and is itself considered illegal.

But, have you even wandered that why is actually considered Black money? And why do illegal people use black money?

Now, let's understand this with an example.

1. Consider a situation, you are in a dark room where you can't see anything and don't know which stuff is at which place and everything seems black.

2. Now, you have turned on lights. That means you can see what are all the stuff present in the room and what their position is.

Similarly, here the stuff are money which in dark(illegal work) can't be seen and all looks black.

And in 2 condition there were stuff(money) which were visible due to light to observer(Government).

In, short which is in Government surveillance and is visible to government is white money.

Whereas the money which is not visible to government is called black money.

Coming to second question that why do people us black money?

Consider a situation where someone(for ex Vishal) want to buy something but what is vishal buying costs high amount of money for example a property.

So, if the cost of the property is ₹1cr then he have to pay all the government charge of 18% extra on that property. So his total expenditure is ₹1,18,00,000 in which ₹18lacs are government charges.

However, if the buyer(Manjeet) would have used black money here then he would have to pay less money.

Like:- The property is of ₹1cr but there was also a minimum price of that area which was ₹50lacs and Manjeet would have bought property by showing the price of ₹50lacs to government to which government charged 18% charges and taxes so here, Manjeet had to pay ₹9lacs to government and to fulfill the demand of seller he gave him another ₹50lacs in black most probably in cash

So his total expenditure would be ₹50lacs(white) + 18%*50lacs + ₹50lacs(black)

=₹1,09,00,000

So as compared to Vishal, Manjeet have bought the property at same buy paying less.

This was just one of the illegal use of black money. There are many purpose too behind using the black money like political reasons, behind terrorism, behind illegal transaction,etc.

Image credit:- DNA India