Inflation Indexed National Savings Securities- Cumulative, 2013
It has been decided by the Government of India, as per their
Notification F.No. 4(16) W&M/2012 dated December 19, 2013,
to issue Inflation Indexed National Savings Securities- Cumulative,
2013 (“the Bonds”) with effect from December 23, 2013 to December 31,
2013. The Government of India reserves the right to close the issue
earlier than December 31, 2013. The terms and condition of the issue of
the Bonds shall be as follows:
2. Eligibility for Investment
The Bonds may be held by:-
i) an individual, not being a Non-Resident Indian-
- in his or her individual capacity, or
- in individual capacity on joint basis, or
- in individual capacity on anyone or survivor basis, or
- on behalf of a minor as father/mother/legal guardian.
ii) a Hindu Undivided Family (HUF)
iii) (a) 'Charitable Institution' to mean a Company registered under Section 25 of the Indian Companies Act 1956, or
(b) an institution which has obtained a Certificate of
Registration as a charitable institution in accordance with a law in
force; or
(c) any institution which has obtained a certificate from
Income Tax Authority for the purposes of Section 80G of the Income Tax
Act, 1961.
iv) 'University' means a university established or incorporated
by a Central, State or Provincial Act, and includes an institution
declared under section 3 of the University Grants Commission Act, 1956
(3 of 1956), to be a university for the purposes of that Act.
3. Limit of Investment
Minimum limit for investment in the bonds is `5,000/- and maximum limit for investment is `5,00,000/- per applicant per annum.
4. Tax Treatment
Income Tax: Interest on the Bonds will be taxable under the
Income-Tax Act, 1961 as applicable according to the relevant tax status
of the bonds holder.
5. Issue Price
i) The Bonds will be issued at par, i.e. at 100.00 per cent.
ii) The Bonds will be issued for a minimum amount of `5,000/- (face value) and in multiples thereof. Accordingly, the issue price will be `5,000/- for every `5,000/-(Nominal).
6. Subscription
Subscription to the Bonds will be in the form of
Cash/Drafts/Cheques/online through internet banking. Cheques or drafts
should be drawn in favour of the bank (Receiving Office), specified in
paragraph 10 below and payable at the place where the applications are
tendered.
7. Date of Issue
The date of issue of the Bonds in the form of Bonds Ledger
Account will be opened (issued) from the date of receipt of
funds/realisation of draft/cheque.
8. Form
i) The Bonds will be issued only in the form of Bonds Ledger
Account and may be held at the credit of the holder in an account
called Bonds Ledger Account (BLA).
ii) The Bonds will be issued in the form of Bonds Ledger Account
and held with Reserve Bank of India. A certificate of holding as
specified in ‘Form I’ (attached) will be issued to the holder of Bonds
in Bonds Ledger Account.
9.Applications
i) Applications for the Bonds may be made in the
application format attached or in any other form as near as thereto stating clearly the amount and the full name and address of the applicant.
ii) Applications should be accompanied by the necessary payment
in the form of cash/drafts/cheques/online through internet banking as
indicated in paragraph 6 above.
Note:- The authorised banks are responsible to ensure
compliance with the applicable KYC norms. The application form and the
requisite documentation are to be retained by the authorised banks for
record and future reference.
10. Receiving Offices
Applications for the Bonds in the form of Bonds Ledger Account will be received at:
(a) Branches of State Bank of India, Associate Banks,
Nationalised Banks, three private sector banks (i.e. HDFC Bank Ltd.,
ICICI Bank Ltd., AXIS Bank Ltd.) and SHCIL during their working hours.
(b) Any other bank or number of branches of the banks and SHCIL
where the applications will be received as specified by the Reserve
Bank of India in this behalf from time to time.
11. Nomination
-
A sole holder or a sole surviving holder of a Bond(s), being an
individual, may nominate in the Form annexed to this notification or
as near thereto as may be, one or more persons who shall be entitled to
the Bonds and the payment thereon in the event of his/her death.
-
Where any amount is payable to two or more nominees and
either or any of them dies before such payment becomes due, the title
to the Bonds shall rest in the surviving nominee or nominees and the
amount being due thereon shall be paid accordingly. In the event of the
nominee or nominees predeceasing the holder, the holder may make a
fresh nomination.
-
No nomination shall be made in respect of the Bonds issued in the name of a minor.
-
A nomination made by a holder of Bonds may be varied by a
fresh nomination as near thereto as may be, or may be cancelled by
giving notice in writing to the Receiving Office in the Form annexed to
the notification.
-
Every nomination and every cancellation or variation shall
be registered at the Reserve Bank of India through the authorised bank
and shall be effective from the date of such registration.
-
If the nominee is a minor, the holder of Bonds may appoint
any person to receive the Bonds/amount due in the event of his/her
death during the minority of the nominee.
12. Transferability
The Bonds in the form of Bonds Ledger Account shall be transferable to nominee(s) on death of holder (only individual/s).
13. Interest
The Bonds will bear interest at the rate of 1.5% (fixed rate)
per annum + inflation rate calculated with respect to final combined
Consumer Price Index [(CPI) Base; 2010 = 100]. Final combined CPI will
be used with a lag of three months to calculate incremental inflation
rate (i.e. final combined CPI for September would be used as reference
CPI for all days of December). Interest will be compounded with
half-yearly rests and will be payable on maturity along with the
principal.
14. Advances/Tradability against Bonds
The Bonds shall not be tradable in the secondary market. The
Bonds shall be eligible as collateral for loan from banks, Financial
Institutions and Non-Banking Financial Company (NBFC). The lien to that
effect will be marked in the depository (RBI) by the authorised banks.
15. Repayment
-
The Bonds shall be repayable on the expiration of 10 (ten)
years from the date of issue. The investor will be advised by the
authorised bank one month before maturity regarding the ensuing
maturity of Bonds advising them to provide a Letter of Acquaintance,
confirming the NEFT/NECS account details, etc. to the authorised bank.
If everything is in order, the investor will be paid within maximum
five days of the maturity.
-
Early repayment/redemption before the maturity date is
allowed after one year of holding from the date of issue for senior
citizens, i.e. 65 and above years of age and for all others, after 3
(three) years of holding, subject to the penalty charges at the rate of
50% of the last coupon payable. Early redemption to be allowed only on
coupon date.
16. Handling charges
Handling charges at the rate of
`1.00 (Rupee one only) per
`100.00 will be paid to the authorised banks on the subscription received by them from investors.
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