Master Circular on Nomination facility in Relief / Savings Bonds

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Master Circular on Nomination facility in Relief / Savings Bonds

RBI/2010-11/37
DGBA.CDD No. H – 10175 / 13.01.299 / 2010-11

July 1, 2010
Ashadha 10, 1932 (S)

The Chairman / Managing Director
State Bank of India and Associate banks
17 Nationalized banks
Axis Bank Ltd / ICICI Bank Ltd / IDBI Bank / HDFC Bank Ltd /
Stock Holding Corporation of India Ltd

Dear Sir/Madam

Master Circular on Nomination facility in Relief / Savings Bonds

The Department of Government and Bank Accounts, Central Office, RBI has been issuing instructions relating to nomination facility for Relief/Savings bond holders from time to time. In order to enable Agency Banks to have all the current operative instructions on the above subject at one place, a revised Master Circular on ‘Nomination facility in Relief/Savings Bonds’ has been prepared which is updated upto 30th June every year. Accordingly, the amended circular giving the updated position upto 30.06.2010 is enclosed. You may also access the circular on our website www.rbi.org.in

Please acknowledge receipt.

Yours faithfully,

(Indira Nanu)
General Manager

Relief Bond / Saving Bond Schemes
Nomination facility

A sole holder or all the joint holders (investors) of a Relief/Savings Bond other than in the form of promissory note or bearer bond 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.
The nomination should be made before maturity of the bond.
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.
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 intimated the same in writing to the designated branch of the authorised public/private sector bank.
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.
The investor(s) may make separate nomination for each investment in a BLA (subject to (ii) above).
Agency Banks to issue ‘Acknowledgement of Nomination’.
In case of 8 % Savings (Taxable) Bonds, 2003 (currently the only bond in respect of which subscription is open), 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 as applicable to NRIs.

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.

Cancellation of Nomination: A nomination previously made will stand automatically cancelled -

if the holder(s) applies to the Agency banks for substitution or cancellation of the nomination and the substitution and cancellation is duly registered by the office;
if the holder(s) transfers the Certificate to another party.

The various circulars issued by this Department based on which the above Master Circular is prepared are listed below: