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Sovereign Gold Bond Series XI

Sovereign Gold Bond Series XI

Reserve Bank of India vide their letter no. RBI/2020-21/52 IDMD.CDD.No.730/ 14.04.050/2020-21 dated October 09, 2020 informing Government of India has vide its Notification F.No. 4(4)-B-(W&M)/2020 dated October 09, 2020, announced the Sovereign Gold Bond Scheme2020-21 series VII, VIII, IX, X, XI & XII. Under the Scheme there will be a distinct series (Starting from Series VII) for every tranche. The Sovereign Gold Bonds will be issued in six tranches from October ,2020 to March 2021 as per the calendar specified below.

S. N.

Tranche

Date of Subscription

Date of Issuance

1

2020-21 Series VII

October 12 - 16, 2020

October 20, 2020

2

2020-21 Series VIII

November 09 - 13, 2020

November 18 2020

3

2020-21 Series IX

December 28 2020 -

January 01, 2021

January 05, 2021

4

2020-21 Series X

January 11-15, 2021

January 19, 2021

5

2020-21 Series XI

February 01- 05, 2021

February 09, 2021

6

2020-21 Series XII

March 01 – 05, 2021

March 09, 2021

The terms and conditions of the issuance of the Bonds shall be as follows:

1 .Eligibility For Investment:

The Bonds under this Scheme may be held 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. The bond may also be held by a Trust, HUFs, Charitable Institution and University. “Person resident in India” is defined under section 2(v) read with section 2(u) of the Foreign Exchange Management Act, 1999

  1. Form of Security

The Bonds shall be issued in the form of Government of India Stock in accordance with section 3 of the Government Securities Act, 2006. The investors will be issued a Holding Certificate (Form C). The Bonds shall be eligible for conversion into de-mat form.

  1. Period of Subscription

Date of issuance shall be February 01, 2021 to February 05, 2021.

  1. Denomination

The Bonds shall be denominated in multiples of gram(s) of gold with a basic unit of 1 gram and multiples thereof. Minimum investment in the Bonds shall be one gram with a maximum limit of subscription of 4 Kilograms per person per fiscal year (April – March).

  1. Issue Price

The issue price of the Sovereign gold Bond for this tranche has been fixed at ?4912.00 (Rupees Four Thousand Nine hundred and Twelve only) per gram of gold. The rate has been 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 (IBJA) for the last 3 working days of the week preceding the subscription period. The issue price of the Gold Bonds will be Rs.50.00 per gram less for those who subscribe online and pay through digital mode.

  1. Interest

The investors will be compensated at a fixed rate of 2.50 percent per annum payable half yearly on the nominal value.

  1. Receiving Offices

Scheduled commercial banks (excluding RRBs), designated Post Offices (as may be notified), Stock Holding Corporation of India Ltd (SHCIL) and recognized stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Limited are authorized to receive applications for the Bonds either directly or through agents.

  1. Payment Options

Payment shall be accepted in Indian Rupees through Cash up to a maximum of Rs.20,000/- or Demand Drafts or Cheque or Electronic banking. Where payment is made through cheque or demand draft, the same shall be drawn in favour of Receiving Office.

  1. Redemption
  2. i) The Bonds shall be repayable on the expiration of eight years from the date of issue of Gold bonds. Pre-mature redemption of the Bond is permitted after fifth year of the date of issue on the interest payment dates.
    ii) The redemption price shall be fixed in Indian Rupees on the basis of previous 3 working day’s simple average closing price for gold of 999 purity, published by IBJA.
    iii) The Receiving Office shall inform the investor of the date of maturity of the Gold Bond one month before its maturity.
  3. Repayment

The Receiving Office shall inform the investor of the date of maturity of the Bond one month before its maturity.

  1. Eligibility for Statutory Liquidity Ratio (SLR)

Bonds acquired by the banks through the process of invoking lien/hypothecation/pledge alone, shall be counted towards Statutory Liquidity Ratio.

  1. Loan against Bonds

The 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 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.

  1. Tax Treatment

Interest on Gold Bonds 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 has been exempted. The indexation benefits will be provided to long term capital gains arising to any person on transfer of bond.

  1. Applications

Subscription for the Bonds may be made in the prescribed application form (Form ‘A’) or in any other form as near as thereto stating clearly the grams (in units) of gold and the full name and address of the applicant. Every application must be accompanied by the PAN details issued by the Income Tax Department to the investor(s).

  1. Nomination

Nomination 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 December 1, 2007.

  1. Transferability

The Bonds shall be 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 December 1, 2007.

  1. Tradability Of Bonds

Bonds will be tradable on stock exchanges.

  1. 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 individuals and other entities.

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