February 22, 2006
Phalguna 2, 1927 (Saka)
REPAYMENT CIRCULAR No. 2 / 2006
The General Manager
State Bank of India and Associate Banks and 17 Nationalised
Banks
The Managing Director
ICICI / IDBI / HDFC / UTI Bank and SHCIL
Dear Sir,
Repayment of 8.5% Relief Bonds,
2001
Please refer to our Loan Circular
No 117 dated March 20, 2001 regarding issue of 8.5% of R.B. 2001. The said bonds
issued in terms of Government of India Notification No. F. 4 (4) W & M /
2001 dated 15.3.2001 will mature for repayment from 15.3.2006 onwards according
to the date of individual investments. The Press Communiqué dated February
15, 2006 issued by Government of India, Ministry of Finance, Department of Economic
Affairs, New Delhi is enclosed for information. The general procedures to be
strictly adhered to by the Agency banks in connection with the repayment of
the bonds held under BLAs are given below:
1 Issue of Advices to Investors:
The attention of the holders may be drawn to the ensuing maturity of their
bonds one month before the date on which investment in the BLA is due for repayment
as per the format given in Annexure I. The holders may be advised
to submit the requisite documents 20 days in advance so that the repayment is
effected on the due date itself. The advices should be sent by Registered /
Speed Post. It should be ensured that the advices are sent only in respect of
BLAs which are free from stoppage.
2. Post Maturity Interest: Although
it was indicated in the MOP, Loan Circular No 117 dated March 20, 2001 and relative
Government Notification that the investment under the scheme attracts Post Maturity
Interest, the facility was subsequently withdrawn by the Government vide its
Notification No. F. 4 (5)-W & M / 2002 dated February 28, 2003. You are,
therefore, advised to indicate to the investors that the investment does
not carry Post Maturity Interest, prominently in the above advices.
3. Discharge of Certificates by
the investors
(i) As per paragraph 1.18
of the Memorandum of Procedure, the designated branches are required to obtain
the COH duly discharged at the time of repayment. As COH may contain multiple
investments, discharge on COH may not be insisted upon. The Certificates of
Holding / Certificates of Investment (COHs / COIs) submitted by the investors
may be verified with the BLAs. A stamped receipt obtained from the BLA holder
in the prescribed format (Annexure 1 A) may be treated
as discharge certificate and preserved. It should be ensured that all required
details are furnished in the receipt before making payment.
(ii) As per extant instructions,
the investor is required to furnish the particulars of his PAN / GIR number,
or a declaration in Form No 60, in case the investor does not have PAN / GIR
No, if the amount of repayment exceeds Rs. 1 lakh.
4. Payment to the Investors
(i) Although the Receipt
in Form Annexure IA is submitted well in advance for repayment,
it should be ensured that actual payment of discharge value is made only on
the due date, or later if the same is submitted after the due date, of maturity.
In the event of holiday being declared by the State Government under the Negotiable
Instruments Act, 1881 on the maturity date or maturity date being Sunday, the
maturity proceeds may be made on the previous working day.
(ii) The repayment should
be made only by the bank branch concerned, maintaining the BLA and the details
of closure of the investment(s) i.e. date(s) and amount(s) should invariably
be indicated in the BLA, duly authenticated by the Supervising Official.
(iii) If multiple investments
are made against the same BLA, the repayment / closure of individual investment
should be marked off under authentication of an official and reflected therein
and a statement of holding duly indicating the BLA number, date of maturity
and amounts in respect of individual investments maybe generated and given to
the investor along with his COH. It should be ensured that the outstanding balance
appearing in the BLA and the statement of holding are the same.
(iv) The payment may be
made either by credit to the S.B. account of the investor or by issue of Payment
Order depending on whether investor maintains an account with the bank or not.
The payment may be made as per mandate of the investor under ECS also, subject
to the extant instructions. In case the investor desires to receive the maturity
proceeds by post, it may be dispatched by Speed / Registered Post, so as to
reach him at least one day in advance from the date of maturity.
5. The Payment Order in advance:
In case of repayment by issuance of payment order [paragraph 4 (iv) above],
it should be ensured that the Payment Orders bearing the dates of redemption
are prepared and kept ready / dispatched in case of request so as to reach the
holder at least one day in advance and for senior citizens, three days in advance.
6. Interest payments: As
regards BLAs held under non-cumulative scheme, the interest for last broken
period should be paid along with the principal. The interest warrants pertaining
to such investments should be dispatched on the due date of maturity irrespective
of whether the investor has surrendered the COH/COI/discharge receipt for repayment
or not. While despatching such interest warrants of matured BLAs, the covering
letter addressed to the investor should indicate that the investment has matured
on the specific date. The advices to the investors should invariably contain
the legend "Interest will not accrue on the investment after ----/ ----/
---- (date of maturity)".
7. Accounting: The Principal
and the interest should be separately accounted for and the scrolls drawn separately
and kept on records for audit/ verification in terms of the extant instructions
issued from time to time.
8. Reporting to Government of
India: The designated branches should submit a statement showing the payments
and outstanding in respect of the BLAs under the scheme on monthly basis to
the Controller of Accounts, Department of Economic affairs, Ministry of Finance,
Government of India, New Delhi through their Link Office. The repayment scrolls
pertaining to the principal and the interest should be drawn separately as per
Appendix XI & XII of MOP for this purpose.
9. Reporting to PDO of jurisdiction:
The monthly report sent to the PDO of jurisdiction should invariably contain
the details of repayments in part D of Appendix IV. The repayment scrolls pertaining
to the principal and the interest drawn separately as per Appendix XII of MOP
for the month as above may also be submitted alongside.
10. Reimbursement from CAS Nagpur:
The agency banks may prefer claims for reimbursement as per paragraph 1.14
and 1.18 (section I) of MOP only in respect of the repayments effected by
them. Such claims may be submitted in the usual manner to CAS, Nagpur through
the respective link cells along with the consolidated scrolls separately
for principal and interest. The claims should be duly supported by a certificate
from the Internal / Concurrent Auditors to the effect that the repayment figures
have been checked 100% and that the amount have already been paid to the investors.
11. Preservation of Records:
The instructions vide paragraph 1.22 of MOP regarding preservation of records
should be followed meticulously.
12. Advice to designated Banks:
Since most of the branches have computerized their operations, the requisite
system changes required to comply with the above instructions, may please be
made well in advance to avoid any hassles at the operational level and to render
better customer service to the investors. The contents of this circular may
please be brought to the notice of the designated branches concerned urgently.
13. The above instructions
are illustrative and not exhaustive and should be read with the instructions
in the MOP. In case of any specific doubts or queries on the above, the designated
banks / branches may please contact the PDO of jurisdiction.
14. Please acknowledge receipt
and monitor compliance.
Yours faithfully,
(P. Loganathan)
Assistant General Manager
2. As per GOI Notification No.
F.4 (5) - W & M / 2002 dated February 28, 2003 Interest will not accrue
on the investments from and after the date of maturity indicated above.
3. Kindly return the attached ANNEXURE
1 A, completed in all respects, and the receipt (Acquittance) duly
discharged by you, after affixing the revenue stamp at the place provided for,
to enable us to credit your account / issue Payment Order. In case the repayment
is to be made under ECS you may please submit the mandate for the same.
4. In case you like to have the
Payment Order by post, please note to indicate your bank particulars in the
Annexure 1 A.
5. Kindly note to submit the above
documents 20 days in advance so that the repayment is made on the due date itself.
Yours faithfully,
Signature
(Name and Designation)
ANNEXURE 1 A
From
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To
The Branch Manager
………………………
………………………
………………………
Dear Sir,
Repayment of 8.5% Relief Bonds Scheme 2001
I / We request and authorise that the following
investment in my / our BLA under 8.5 % Relief Bonds Scheme 2001 may please be
paid by a Payment Order.