Sovereign Gold Bond Scheme 2018 -19
Sovereign Gold Bond Scheme 2018 -19
Government of India,
in consultation with the Reserve Bank of India, has decided to issue Sovereign
Gold Bonds-2018-19. The Sovereign Gold Bonds will be issued every month from
October 2018 to February 2019 as per the calendar specified below:
S. No.
|
Tranche
|
Periodof
Subscription
|
Date of
Issuance
|
1
|
2018-19
Series II
|
October
15-19, 2018
|
October
23, 2018
|
2
|
2018-19
Series III
|
November
05-09, 2018
|
November
13, 2018
|
3
|
2018-19
Series IV
|
December
24-28, 2018
|
January
01, 2019
|
4
|
2018-19
Series V
|
January
14–18, 2019
|
January
22, 2019
|
5
|
2018-19
Series VI
|
February
04-08, 2019
|
February
12, 2019
|
The Bonds will be
sold through banks, Stock Holding Corporation of India Limited (SHCIL),
designated post offices, and recognised stock exchanges viz.,
National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The
features of the Bond are given below:
Sl. No.
|
Item
|
Details
|
1
|
Product
name
|
Sovereign Gold Bond 2018-19.
|
2
|
Issuance
|
To be issued by Reserve Bank India on behalf of
the Government of India.
|
3
|
Eligibility
|
The Bonds will be restricted for sale to resident
entities including individuals, HUFs, Trusts, Universities and Charitable
Institutions.
|
4
|
Denomination
|
The Bonds will be denominated in multiples of
gram(s) of gold with a basic unit of 1 gram.
|
5
|
Tenor
|
The tenor of the Bond will be for a period of 8
years with exit option in 5th, 6th year and 7th year
to be exercised on the interest payment dates.
|
6
|
Minimum
size
|
Minimum permissible investment will be 1 gram of
gold.
|
7
|
Maximum
limit
|
The maximum limit of subscribed shall be 4 KG for
individual, 4 Kg for HUF and 20 Kg for trusts and similar entities per fiscal
(April-March) notified by the Government from time to time. A
self-declaration to this effect will be obtained. The annual ceiling will
include bondssubscribed under different tranches during initial issuance by
Government and those purchased from the Secondary Market.
|
8
|
Joint
holder
|
In case of joint holding, the investment limit of
4 KG will be applied to the first applicant only.
|
9
|
Issue
price
|
Price of Bond will be fixed in Indian Rupees on
the basis of simple average of closing price of gold of 999 purity, published
by the India Bullion and Jewellers Association Limited for the last 3 working
days of the week preceding the subscription period. The issue price of the
Gold Bonds will be `50 per gram less for those who subscribe online and
pay through digital mode.
|
10
|
Payment
option
|
Payment for the Bonds will be through cash
payment (up to a maximum of `20,000) or demand draft or cheque or
electronic banking.
|
11
|
Issuance
form
|
The Gold Bonds will be issued as Government of
India Stock under GS Act, 2006. The investors will be issued a Holding
Certificate for the same. The Bonds are eligible for conversion into demat
form.
|
12
|
Redemption
price
|
The redemption price will be in Indian Rupees
based on previous 3 working dayssimple average of closing price of gold of
999 purity published by IBJA.
|
13
|
Sales
channel
|
Bonds will be sold through banks, Stock Holding
Corporation of India Limited (SHCIL), designated post offices (as may be
notified) and recognised stock exchanges viz., National Stock
Exchange of India Limited and Bombay Stock Exchange, either directly or
through agents.
|
14
|
Interest
rate
|
The investors will be compensated at a fixed rate
of 2.50 percent per annum payable semi-annually on the nominal value.
|
15
|
Collateral
|
Bonds can be used as collateral for loans. The
loan-to-value (LTV) ratio is to be set equal to ordinary gold loan mandated
by the Reserve Bank from time to time. The lien on the bonds shall be marked
by the depositary by the authorized banks. The loan against SGBs would be
subject to decision of the lending bank/institution and cannot be inferred as
a matter of right by the SGB holder.
|
16
|
KYC
documentation
|
Know-your-customer (KYC) norms will be the same
as that for purchase of physical gold. KYC documents such as Voter ID,
Aadhaar card/PAN or TAN /Passport will be required. Every application must be
accompanied by the ‘PAN Number’ issued by the Income Tax Department to the
investor(s).
|
17
|
Tax
treatment
|
The interest on Gold Bonds shall be taxable as
per the provision of Income Tax Act, 1961 (43 of 1961). The capital gains tax
arising on redemption of SGB to an individual has been exempted. The
indexation benefits will be provided to long term capital gains arising to
any person on transfer of bond.
|
18
|
Tradability
|
Bonds will be tradable on stock exchanges within
a fortnight of the issuance on a date, as notified by the RBI.
|
19
|
SLR
eligibility
|
Bonds acquired by the banks through the process
of invoking lien/hypothecation/pledge alone, shall be counted towards
Statutory Liquidity Ratio.
|
20
|
Commission
|
Commission for distribution of the bond shall be
paid at the rate Rupee one per hundred Rupees the total subscription received
by the receiving offices and receiving offices shall share at least paise 50
per hundred Rupees of the commission so received with the agents or sub
agents for the business procured through them.
|
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