In exercise of the
powers conferred by clause (iii) of section 3 of the Government Securities Act,
2006 (38 of 2006), the Central Government hereby makes the following Scheme,
namely: (i) This scheme may be called the Sovereign Gold Bond Scheme 2017-18 -
Series II. (ii) It shall come into force on the date of its publication in the Official
Gazette. In this Scheme, unless the context otherwise
requires: (a) "Form" means a form appended to this Scheme; (b) "receiving office" means the offices or branches of
Nationalised Banks, Scheduled Private Banks, Scheduled Foreign Banks (as
specified in Annexure I to this notification), designated Post Offices (as
specified in Annexure II to this Notification), Stock Holding Corporation of
India Ltd. (SHCIL) and the authorised stock exchanges as specified in Annexure
III to this notification. (c) "Stock Certificate" means the Gold Bond issued in the form of
Government of India Stock in accordance with section 3 of the Government
Securities Act, 2006. The Gold Bonds under this Scheme may be held by a
Trust, HUFs, Charitable Institution, University or by a person resident in India,
being an individual, in his capacity as such individual, or on behalf of minor
child, or jointly with any other individual. Explanation- For the purposes of this paragraph: (i) "person" shall have the same meaning as defined in clause (u)
of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999); (ii) the expression "person resident in India" shall have the same
meaning as defined in clause (v) of section 2 of the Foreign Exchange
Management Act, 1999 (42 of 1999). (iii) Trusts to mean a trust constituted/formed as per the Indian Trusts Act,
1882, or a public or private trust constituted or recognized under the
provisions of any Central or State law for the time being in force and also an
express or constructive trust constituted for either a public religious or
charitable purpose or both which includes a temple, a math, a wakf, a church, a
synagogue, an agiary or any other place of public religious worship, or a
dharmada or any other religious or charitable endowment and also a society,
formed either for a religious or charitable purpose or for both, registered
under the Societies Registration Act, 1860 or under any other law for the time
being in force in India. (iv) 'Charitable Institution' to mean a Company registered under Section 25
of the Indian Companies Act, 1956 or under Section 8 of the Companies Act,
2013; or An institution, which has obtained a Certificate of Registration as a
charitable institution in accordance with a law in force; or Any institution
which has obtained a certificate from an Income Tax Authority for the purposes
of Section 80G of the Income Tax Act, 1961. (v) "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 the Act." (i) The bonds will be issued in denominations of one gram of gold or
multiples thereof. Provided that the minimum limit of subscription in
the Bonds issued under Series II shall be of one gram and maximum limit of
subscription shall be of five hundred grams per person per fiscal year. Provided further that in case of joint holding, the
above limits shall be applicable to the first applicant only. (ii) The nominal value of Gold Bonds shall be 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 week (Monday to Friday)
preceding the subscription period. (iii) The issue price of the Gold Bonds will be ` 50 per gram less
than the nominal value. (i) Every Subscriber who is desirous of subscribing to the Gold Bonds shall
apply to any receiving office in Form 'A' or in any other form as near as
thereto, stating clearly the grams of gold and full name and address of the
applicant. (ii) Every application shall contain such documents and particulars as
specified in the instructions contained in the Application Form. (iii) On receipt of an application under sub paragraph 1, the receiving office
shall issue an acknowledgment receipt in Form 'B', if all requirements of the
application are fulfilled. (iv) An incomplete application is liable to be rejected. (i) The Gold Bonds shall be issued on the 28th day of July 2017 in the form
of a Stock Certificate as specified in Form 'C'. (ii) The Gold Bonds shall be eligible to be converted into Demat form. The Subscription of the Gold Bond under this Scheme
shall open on and from the 10th day of July 2017 and shall close on the 14th
day of July 2017; Provided that the Central Government may, with
prior notice, close the Scheme before the period specified above. (i) The interest on the Gold Bonds shall commence from the date of its issue
and shall have a fixed rate of interest at 2.50 per cent per annum on the
nominal value. (ii) The interest shall be payable in half-yearly rests and the last interest
shall be payable along with the principal on maturity. The receiving offices shall be authorised to
receive applications for the Bonds either directly or through agents. (i) All payments for Gold Bond shall be accepted in Indian Rupees through
cash (upto a maximum of Rs. 20,000/-) or demand draft, or cheque, or electronic
banking. (ii) Where payment is made through cheque or demand draft, the same shall be
drawn in favour of the receiving office. (i) The Gold Bond shall be repayable on the expiration of eight years from
the 28th day of July 2017, the date of the issue of Gold Bonds: Provided that premature redemption of Gold Bond may
be permitted after fifth year from the date of issue of such Gold Bond on the
date on which interest is payable. (ii) On maturity, the Gold Bonds shall be redeemed in Indian Rupees and the
redemption price shall be based on simple average of closing price of gold of
999 purity of previous week (Monday to Friday) published by the India Bullion
and Jewellers Association Limited. (iii) The receiving office shall inform the investor one month in advance,
about the date of maturity of the Gold Bond. The investment in the Gold Bonds under this Scheme
shall be eligible investments for Statutory Liquidity Ratio purpose. (i) The Gold Bonds under this Scheme may be used as collateral security for
any loan. (ii) The Loan to Value ratio as applicable to any ordinary gold loan mandated
by the Reserve Bank of India shall also apply to the Gold Bond under this
Scheme. (iii) The lien on the bond shall be marked in the depository by the authorised
banks. The interest on the Gold Bond shall be taxable as
per the provisions of the Income-tax Act, 1961 (43 of 1961). The capital gains
tax arising on redemption of SGB to an individual is exempted. The 'indexation
benefits will be provided to long-term capital gains arising to any person on
transfer of bond' Nomination of and its cancellation shall be made in
Form 'D' and Form 'E', respectively, in accordance with the provisions of the
Government Securities Act, 2006 (38 of 2006) and the Government Securities
Regulations, 2007, published in part III, Section 4 of the Gazette of India
dated the 1st December 2007. The Gold Bonds issued in the form of Stock
Certificate are transferable by execution of an Instrument of transfer as in
Form 'F', in accordance with the provisions of the Government Securities Act,
2006 (38 of 2006) and the Government Securities Regulations, 2007, published in
part III, Section 4 of the Gazette of India dated the 1st December 2007. The Gold Bonds shall be eligible for trading from
such date as may be notified by the Reserve Bank of India. The commission for distribution shall be paid at
the rate of rupee one per hundred of the total subscription received by the
receiving offices and receiving offices shall share at least 50% of the
commission so received with the agents or sub agents for the business procured
through them. All other terms and conditions specified in the
notification of Government of India in the Ministry of Finance (Department of
Economic Affairs) vide number F. No.4(13) W&M/2008, dated the 8th October,
2008 shall apply to the Gold Bond issued under this scheme. SOVEREIGN GOLD BOND SCHEME 2017-18 - SERIES
II
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