8% Savings (Taxable) Bonds, 2003 - Premature Encashment - ଆରବିଆଇ - Reserve Bank of India
8% Savings (Taxable) Bonds, 2003 - Premature Encashment
RBI/2013-14/206 August 30, 2013 The Chairman / Managing Director Dear Sir/Madam, 8% Savings (Taxable) Bonds, 2003 - Premature Encashment The captioned bonds, issued with effect from April 21, 2003, vide Government of India Notification No. F 4(10)-W&M/2003 dated March 21, 2003 and subsequent Notification F. No. 4(10)-W&M/2003 dated April 2, 2003, are repayable on the expiry of six years from the date of issue. Premature encashment was not permissible under this scheme. 2. The Government of India has now vide Notifications dated July 29, 2013 and August 16, 2013 (copies enclosed), decided to provide the facility of premature encashment of these bonds to individual investors in the age group of sixty years and above, after a minimum lock-in period of three years from the date of issue as indicated below:-
3. An investor, desiring to avail of the facility of premature encashment, will have to submit documentary evidence in support of his/her date of birth to satisfaction of the agency bank. In case of joint holders or more than two holders of a bond, any one of the holders should fulfil the above conditions of eligibility. 4. After aforesaid minimum lock-in period from the date of issue, an eligible investor can surrender the bonds at any time after the 10th or 8th or 6th half-year as applicable, corresponding to the respective lock-in period, however, encashment payment will be made on the following interest payment due date. Thus, the effective date of premature encashment for the eligible investors, in case of Non-Cumulative bonds will be 1st August and 1st February every year after completion of the lock-in period as per the eligibility criteria and for Cumulative bonds, it will be notionally the 7th or 9th or 11th half-yearly interest payment due date (the date can be any date and not necessarily 1st August and 1st February). However, 50% of the interest due and payable for the last six months of the holding period will be recovered as penalty from the investor for premature encashment in such cases, both in respect of cumulative and non-cumulative bonds. The amount payable on completion of respective half year for per `1000 invested is given hereunder:
5. We further clarify the provisions for premature encashment as under:
6. The premature encashment of investment may be allowed even after despatch of interest warrant, but such requests, received after despatch of interest warrants, must be accompanied by the interest warrant of latest half-year issued to the investor. However, in cases where interest warrants have already been despatched, but not yet received by the holders or not tendered by the holder, request for premature encashment may be accepted on the condition that 50% of the interest due and payable for the last six months of the holding period will be recovered from the principal amount and credited to the Interest Account maintained with CAS, Nagpur. In case of receipt of requests for premature encashments well in advance, Payment Orders for encashment amount/credit to account through NEFT/NECS will be made on the next half yearly due date, i.e. 1st August/1st February, as the case may. In case where such request is not received well in advance, the issuing offices may take five clear working days to make the payment. 7. Suitable instructions to designated branches operating the scheme may be issued to make the changes in the system to absorb the premature encashment process. The premature encashment option may also be suitably displayed in the dealing branches. 8. Please acknowledge receipt. Yours faithfully, (Sangeeta Lalwani) Encl:As above |