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Master Directions on Relief/Savings Bonds
July, 17th 2019
                                                        
__________________________RESERVE BANK OF INDIA__________________________
                                                              www.rbi.org.in
RBI/IDMD/2018-19/61
IDMD.CDD No.21/13.01.299/2018-19                                                                                      July 2, 2018

The Chairman / Managing Director
Head Office (Government Accounts Department)
State Bank of India
All Nationalized banks
(Excluding Punjab and Sind Bank & Andhra Bank)
Axis Bank Ltd./ICICI Bank Ltd./HDFC Bank Ltd./
Stock Holding Corporation of India Ltd. (SHCIL)

Dear Sir/Madam,

Master Directions on Relief/Savings Bonds

The rules and regulations applicable to Relief/Savings Bonds have been updated
with instructions issued up to June 30, 2018 in the Master Directions on
Relief/Savings Bonds. The directions facilitate availability of all the current operative
instructions on the above subject at one place and will be updated suitably and
simultaneously whenever there is a change in the rules/regulations or there is a
change in the policy. These directions have been placed on RBI website
https://rbi.org.in

Yours faithfully,


(A. Mangalagiri)
Chief General Manager
Encl. 1
                                  
Caution: RBI never sends emails, SMSs or makes calls asking for personal information like bank account details, passwords, etc. It never keeps or
                                  offers funds to anyone. Please do not respond in any manner to such offers.
               MASTER DIRECTIONS - RELIEF/SAVINGS BONDS


                                         Index

Sr. No   Contents                                         Page

  A      Appointment / delisting of brokers                1

  B      Payment & rates of brokerage for Savings Bonds    1

  C      Nomination facility for Relief/Savings Bonds      2

         Appendix                                          4
               MASTER DIRECTIONS - RELIEF/SAVINGS BONDS

A) APPOINTMENT / DELISTING OF BROKERS

1. Procedure for enrollment / registration of brokers
   Receiving Offices may follow a simple procedure for enrolment/registration of
   brokers.   The broker seeking enrolment/registration may submit the request for
   registration on their business letterhead together with business data to the Receiving
   Offices. The Receiving Office should allot a code number to the broker which should
   be quoted by the broker on all applications tendered at the Receiving offices for
   claiming brokerage.

2. Appointment of sub-agents by Receiving Offices
   It has come to our notice that some Receiving Offices have engaged the services of
   other banks as brokers/agents for receiving applications and the latter are using the
   name of RBI in their publicity material and billboards stating that RBI has appointed
   them as brokers for Relief/Savings Bond business. We advise that in cases where
   Receiving Offices engage the services of other banks/institutions as a broker or
   agent, the Receiving Office which have appointed them are solely responsible for
   their activities as an agents/brokers.   RBI's name should not be used by such
   agents/brokers.






3. Delisting of brokers
   The names of the dormant brokers, who have been dormant for say 2 years, may be
   delisted after giving a due notice if, no fresh business is forthcoming from these
   brokers.

B) PAYMENT & RATES OF BROKERAGE FOR SAVINGS BONDS
1. Rates of brokerage
   a.     Brokerage at the rate of ` 0.50 (Fifty paise only) per ` 100/- will be paid to
   brokers registered/enrolled with the Receiving Offices on applications tendered for




                                             2
   investment in the bonds in the form of Bond Ledger Account (BLA) at Receiving
   Offices on behalf of their clients and bearing their stamp.


   b.      No brokerage is payable in case the broker is one of the investors/applicants.


2. No TDS on payment of brokerage
   No tax is required to be deducted at source by the Receiving Office while making
   payment of brokerage in respect of the Relief/Savings Bonds business canvassed by
   brokers in terms of Section 194 (H) of the Income Tax Act, 1961.

3. Brokerage claims
   a.      Receiving Offices are to settle the brokerage claims expeditiously, and in any
   case, not later than 30 days from the date of subscription.
   b.      Receiving Offices are advised to first settle the brokerage claims and
   thereafter seek reimbursement from RBI.
   c.      As a measure towards improvement in customer service, Receiving Offices
   may arrange to pay the brokerage to the agents, on a monthly basis by credit to their
   accounts through ECS after obtaining requisite mandate from them.
   d.      Reimbursement of brokerage claims in respect of Relief/Savings Bonds has
   been centralized at CAS Nagpur from July 01, 2002, and it has been decided that
   90% of the brokerage due to Receiving Offices, on the basis of funds
   remitted/reported to CAS as at the close of business of the month, will be paid on the
   3rd working day of the succeeding month. The balance 10% is to be settled on
   submission of Appendix IV statement.


C) NOMINATION FACILITY FOR RELIEF/SAVINGS BONDS

1. A sole holder or all the joint holders (investors) of a Relief/Savings Bond held in the
   form of a BLA may nominate one or more persons who in the event of death of the
   sole holder/all the joint holders, as the case may be, would be entitled to the
   Relief/Savings Bond and to the payment thereon, provided that the person or each of
   the persons nominated is himself/herself competent to hold a similar bond.
2. The nomination should be made before maturity of the bond.




                                            3
  3. When nomination has been made in favour of two or more nominees, in the event of
      the death of either or any of them, the surviving nominee or nominees, as the case
      may be, shall be entitled to the Relief/Savings Bond and payment thereon.
  4. A nomination made by the holder(s) of a Relief/Savings Bond may be varied or
      cancelled by making a fresh nomination in the prescribed manner and intimating the
      same in writing to the branch of the Receiving Office where the BLA is maintained
      and shall be effective from the date of such registration. Nomination will also stand
      cancelled if the holder(s) transfers the bonds to another party (wherever
      applicable).The transferee will have to register a new nominee.
  5. If the nominee is a minor, the holder(s) of the Relief/Savings Bond may appoint any
      person, not being a minor, to receive the proceeds of a Relief/Savings Bond on
      behalf of the nominee in the event of his/her/their death during the minority of the
      nominee.
6. The investor(s) can make separate nomination for each investment in a Bond Ledger Account (BLA) (subject to 2 above). 7. Receiving Offices to issue `Acknowledgement of Nomination.' 8. In case of 8 % Savings (Taxable) Bonds, 2003 the sole holder or all the joint holders can also nominate a Non-resident Indian (NRI) as his/her/their nominee(s) and remittance of interest payment and/or maturity value, as the case may be, will be governed by the regulations framed under FEMA 1999 as applicable to NRIs. The nomination facilities to NRIs is not available in case of 7.75% Savings (Taxable) Bonds, 2018 Scheme (currently the only scheme open for subscription). Exceptions ­ No nomination is permissible in the following cases (a) When the BLA is held by an adult on behalf of a minor; (b) When the holder has no beneficial interest in the BLA but holds it in an official or fiduciary capacity 4 APPENDIX The various circulars/instructions issued by RBI based on which the above Master Direction is prepared are listed below: i) Memorandum of Procedure' for Relief Bonds. ii) CO.DT.13.01.201/4087/2000-01 dated February 16, 2001 iii) CO.DT.13.01.201/4854/2000-01 dated March 19, 2001 iv) CO.DT.13.01.298/H-3410/2003-04 dated December 20, 2003 v) CO.DT.13.01.299/H-3426/2003-04 dated December 20, 2003 vi) DGBA.CDD. No.H-2173/13.01.299/2008-09 dated September 2, 2008 vii) CO.DT./13.01.201 / 692 / 2000-01 dated August 9, 2000) viii) CO.DT./13.01.251/5341/2001-02 dated January 4, 2000 ix) CO.DT./13.01.201/4890/1999-00 dated March 6, 2000 x) CO.DT./13.01.201/432/2000-01 dated July 25, 2000 xi) GOI Notification No.F.4 (1-W&M/99 dated July 21, 2000 xii) CO.DT./13.01.298/H-2411/2003-04 dated October 29, 2003 xiii) CO.DT./201/5900/2000-01 dated May 28, 2001 xiv) CO.DT./13.01.298/H-3660/2003-04 dated January 3, 2004 xv) CO.DT./13.01.201/4668/2000-01 dated March 8, 2001 xvi) CO.DT.13.01.298/H-4677/2002-03 dated May 23, 2003 xvii) CO.DT.13.01.272/11032/2001-02 dated June 25, 2002 xviii) CO.DT.13.01.272/H-2906 / 2002-03 dated February 26, 2003 xix) IDMD.CDD.No.1671/13.01.299/2017-18 dated January 03, 2018 xx) IDMD.CDD.No.1728/13.01.299/2017-18 dated January 08, 2018. (In case detailed clarifications are required on specific issues, the circulars indicated above may please be referred to)
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