Terms And Conditions Governing Investment In Sovereign Gold Bonds

Transcription

1 Terms And Conditions Governing Investment In Sovereign Gold Bonds The Client understands that the Client can invest in Sovereign Gold Bonds (SGB), through the website on the terms and conditions mentioned herein below (in addition to the other terms and conditions, not contrary to those mentioned herein below, as stated on The client understands that Persons resident in India as defined under Foreign Exchange Management Act, 1999 are eligible to invest in SGB. Hence, on only resident individuals and HUFs would be allowed to invest in SGBs. Other client categories like corporate, partnership firms, LLPs, trusts, etc. would not be allowed to invest. The Client understands and agrees that ICICI Securities Ltd. (hereinafter referred to as I-Sec or ICICI Securities ) reserves all rights to change, modify or alter these terms and conditions at any point of time with or without notice. Pursuant to the Client being the client of ICICI Securities and the Power of Attorney executed by the Client in favour of ICICI Securities with respect to the same, and the applicable rights and obligations & the terms and conditions thereof, the Client hereby instructs ICICI Securities (through the Website to make an investment in SGB subject to the following additional terms and conditions: 1. Definitions: Value Date shall mean the date on which ICICI BANK receives the funds from the Client for the purposes of investment in the Sovereign Bonds irrespective of the date of transaction instruction. 2. The Client may purchase the Sovereign Bonds using the facilities offered by ICICI Securities on The Client s transaction instruction for an investment in any Sovereign Bonds scheme shall, at all times, be subject to the same being processed by ICICI BANK and ICICI Securities. 3. The Client hereby expressly authorises and permits ICICI Securities to deal on the Client s behalf with the issuer of Sovereign Bonds. 4. The Client hereby specifically confirms and affirms that the power of attorney as executed by the Client in favour of ICICI Securities entitles and authorises ICICI Securities to apply and deal in Sovereign Bonds on Client's behalf, and hereby authorises ICICI Securities to provide all necessary confirmations and representations to this effect, and the Client further agrees to execute or provide all further deeds, documents, KYC documents like PAN card copy and address proof copy, instruments or confirmations, in such form, substance or manner, as desired to confirm and affirm the entitlement and authority to apply and deal in Sovereign Bonds on Client s behalf. 5. The transaction instruction may be provided electronically, telephonically or through such other facility as may be made available to the Client by ICICI

2 Securities from time to time. Execution of a transaction instruction for a SGB shall be contingent upon the availability at the time of investment. ICICI Securities, ICICI BANK and /or any of its affiliates shall not be responsible for the nonavailability of a particular SGB at the time of Client placing an order for investment. 6. It shall be the Client s responsibility to ensure that any information made available by the Client to ICICI Securities is true, accurate and free from error. ICICI Securities, ICICI BANK, and/or their affiliates shall not be responsible for any loss or damage that may result from any erroneous information, or any omission in the information that is provided by the Client to ICICI Securities. Neither ICICI Securities nor ICICI BANK shall accept any liability that may arise as a consequence of the incomplete /incorrect data or information provided by the Client and/or any error in the execution of an order due to such incomplete/incorrect data. 7. All orders placed by ICICI Securities on behalf of the Client shall be deemed to have been placed by the Client himself. Neither ICICI Securities nor ICICI BANK shall be liable for any loss that may be incurred by the Client due to a third party placing orders regarding SGB through the Website after getting hold of the Client's personal identification details. 8. Demat account credit would be the default option for all customers with active linked demat a/c. Client may select his/her preferred demat a/c at the time of placing order in case of multiple demat accounts. Client agrees that Certificate of Holding shall be ed only to those customers who hold investment account with ICICI Securities without any linked demat a/c. 9. The Client agrees that any transaction instruction falling due on a public holiday or a Saturday would be processed on the next business day. In case the Client wishes to have the Value Date of the SGB as the date of investment, the Client would have to ensure that the investment is made within the processing time for each business day as may be specified by ICICI Securities. 10. The funds of the Client allocated for investment in SGB shall be transferred back to the Client s bank account in case the Client s instruction for application for SGB is not executed for any reasons whatsoever. ICICI BANK would have the right to reject all or any of the investment instructions regarding SGB received from the Client and the Client agrees that ICICI Securities/ ICICI BANK shall not be held liable, in any manner whatsoever, for the same. No interest shall be payable by ICICI Securities/ICICI Bank on the amount refunded due to rejection for any reason whatsoever. 11. The client understands that SGBs are issued in denominations of one gram of gold and in multiples thereof. Minimum investment in the Bond shall be two grams with a maximum buying limit of 500 grams per person per fiscal year (April March). In case of joint holding, the limit applies to the first applicant. Further, the limit of 500 grams per financial year is applicable even if the bond is bought on the exchanges. Client hereby confirms that he/she has not crossed the

3 maximum limit of 500 grams in the fiscal year. Joint holders in the linked demat a/c would by default be joint holders for the purpose of investment in SGB. In case of investment account without linked demat a/c, only single holder option would be available through ICICI Securities. 12. The client understands that SGB bear interest at the rate of 2.75 per cent (fixed rate) per annum on the amount of initial investment. Interest will be credited semiannually to the bank account of the investor by the issuer and the last interest will be payable on maturity by the issuer along with the principal to the bank account furnished by the customer at the time of buying the bond. 13. The client understands that the tenor of the bond is 8 years. The early encashment/redemption of the bond is allowed after fifth year from the date of issue on coupon payment dates. The Bond will be tradable on Exchange platform from the date to be notified by RBI and can also be transferred to any other eligible investor as per provisions of Government Securities Act. ICICI Securities reserves the right to enable or disable any listed security for trading on its website at its own discretion. 14. The Client hereby understands that there may be Capital loss if the market price of gold declines later post investing in these bonds. Hence, Client fully understands the risk involved in investing in this instrument may lead to loss of principal amount invested if market price of SGB at the time of selling/redemption is lower than the market price at the time of investment. 15. Interest on the SGB shall be taxable as per the provisions of the Income-tax Act, Capital gains tax treatment will be the same as that for physical gold. Further client understands that TDS will not applicable on the bond. However, it is the responsibility of the client to comply with the tax laws. 16. The Client hereby authorizes ICICI Securities to make available to ICICI BANK and/or the Government all such information including Client s KYC information/documents as may be required to facilitate the Client s transacting in SGB herein. ICICI Securities shall ensure that all correspondence or communication relating to the SGB which is meant for the Client is either delivered to the Client or displayed on the Website. 17. The Client agrees to directly contact the concerned ICICI Bank branch in case he/she wishes to redeem/ transfer the SGB or for other services like change of address, nomination, etc. In case there are changes in any details, such as, account number, ids, then the investor must intimate ICICI Bank promptly. 18. ICICI Securities shall be the sole contact point for the Client till the time the electronic Certificate of Holding or credit in Client s linked demat a/c is received by the Client, for the purposes of transactions in SGB conducted on and ICICI Securities shall not be liable in any manner whatsoever in respect of any transactions or correspondence relating to the SGB conducted directly between the Client and any third party.

4 19. The Client hereby agrees to hold ICICI Securities harmless against all actions, claims and liabilities that may be incurred by it due to any action initiated or threatened that may be initiated against it due to the performance of any of their obligations herein and agrees that ICICI Securities, ICICI BANK and/or its Affiliates shall not be liable for any loss suffered by the Client on account of non-execution of the order placed due to any reason whatsoever. 20. Client will not be able to appoint nominee online at the time of making application. If the Client wishes to appoint or change a nominee, the Client will be required to download the applicable nomination form from and send the duly completed form to ICICI Securities or ICICI Bank. In case of demat credit of SGBs, nominee in demat would be able to claim the SGBs like any other security from the Depository Participant in case of death of the holder. However, such nominee shall have to follow the transmission process as specified by RBI for redeeming the SGBs since demat nominee would not be registered with RBI. 21. In case of the Client Agreement/Rights and Obligations Document entered interalia with ICICI Securities being terminated for any reason whatsoever, the Client shall intimate ICICI Securities in writing of the said termination and ICICI Securities shall take the necessary steps to ensure that the Client may transact directly in the SGB. Subsequent to such termination, ICICI Securities shall have no further responsibility or obligation in respect of the Client s transactions in the SGB. 22. ICICI Securities does not undertake any responsibility to provide any additional benefits or products that are advertised and provided by ICICI BANK as a part of any promotional schemes. The same shall at all times be regulated by such terms and conditions as may be stipulated by ICICI BANK from time to time. 23. For all correspondences with ICICI Securities the Client shall be required to quote the Client s ICICIDirect.com trading/ investment account number. 24. The terms and conditions herein contained are subject otherwise to the terms and conditions of the Client Agreement and/ or other documents executed by the Client at the time of account opening. 25. All transactions in SGB shall, at all times, be subject to the rules, regulations and conditions laid down by the Government of India, RBI or any other regulatory authority, from time to time governing the issue of SGB. 26. Once Application is made through ICICI securities for SGB, it cannot be cancelled / modified under any circumstances. Client agrees that an application once submitted cannot be withdrawn and will not be eligible for any refund of funds so invested. 27. The Client undertakes that ICICI Securities shall not at any time incur any liability whether to the Client or to anyone claiming through the Client or any other third party with respect to any damage, losses, costs, expenses, liabilities, or lost

5 profits sustained or alleged to have been sustained or alleged to be sustained as a result of following the Client's instructions. 28. The Client hereby declares that the Client has read, understood and accepted the contents of the terms and conditions contained herein and the below given RBI circular highlighting the instrument details and specifications including the tenor and lock in requirements. The Client hereby agrees and undertakes not to hold ICICI Securities, ICICI BANK and/ or their affiliates liable for any transaction instruction processed on the basis of information provided by the Client. 29. Client is hereby also requested to go through Frequently Asked Questions (FAQs) on SGBs on before investing in SGB. The Client agrees that the FAQs as posted on the site, are an integral part of this Terms and Conditions. The client acknowledges as having read and the understood these FAQs. H.U.F. Declaration (Only if applicant is Karta of HUF) I, the First applicant, do solemnly affirm that I am the Karta of the Hindu Undivided Family in whose name this application for SGB is being made and as such have full powers to sell, endorse, transfer or otherwise deal in SGB standing in the name of the said HUF. I hereby authorize ICICI Securities Limited to submit this declaration, duly certified by an official of ICICI Securities Limited, to ICICI Bank/ RBI/ relevant authority on my behalf, as a holder of valid Power of Attorney executed in its favour by me as the Karta of the said HUF. I / WE have read and accepted the above terms and conditions.

6 RBI CIRCULAR RBI/ /218 IDMD.CDD.No.939/ / October 30, 2015 The Chairman & Managing Director All Scheduled Commercial Banks (Excluding RRBs) Dear Sir/Madam, Sovereign Gold Bonds, It has been decided by the Government of India, as per their Notification F.No. 4(19)- W&M/2014 dated October 30, 2015, to issue Sovereign Gold Bonds, 2015 ( the Bonds ) with effect from November 05, 2015 to November 20, The Government of India may, with prior notice, close the Scheme before the specified period. 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. Person resident in India is defined under section 2(v) read with section 2 (u) of the Foreign Exchange Management Act, 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, The investors will be issued a Holding Certificate (Form C). The Bonds shall be eligible for conversion into de-mat form. 3. Date of Issue Date of issuance shall be November 26, The investors can apply for the Bonds in receiving offices from November 05, 2015 to November 20, The issuance can be closed by Government of India earlier than November 20, 2015 with a prior notice. 4. Denomination The Bonds shall be denominated in units of one gram of gold and multiples thereof.

7 Minimum investment in the Bonds shall be 2 grams with a maximum subscription of 500 grams per person per fiscal year (April March). In case of joint holding, the limit applies to the first applicant. 5. Issue Price Price of the Bonds shall be fixed in Indian Rupees on the basis of the previous week s (Monday Friday) simple average closing price for gold of 999 purity, published by the India Bullion and Jewellers Association Ltd. (IBJA). 6. Interest The Bonds shall bear interest at the rate of 2.75 per cent (fixed rate) per annum on the amount of initial investment. Interest shall be paid in half-yearly rests and the last interest shall be payable on maturity along with the principal. 7. Receiving Offices Scheduled commercial banks (excluding RRBs) and designated Post Offices (as may be notified) are authorized to receive applications for the Bonds either directly or through agents. 8. Payment Options Payment shall be accepted in Indian Rupees through Cash or Demand Drafts or Cheque or Electronic banking. Cheque or draft should be drawn in favour of the bank / post office (Receiving Office), specified in paragraph 7 above and payable at the place where the applications are tendered. 9. Redemption The Bonds shall be repayable on the expiration of eight years from the date of issue. Pre-mature redemption of the Bond is allowed from fifth year of the date of issue on the interest payment dates. The redemption price shall be fixed in Indian Rupees on the basis of the previous week s (Monday Friday) simple average closing price for gold of 999 purity, published by IBJA. 10. Repayment The receiving office shall inform the investor of the date of maturity of the Bonds, one month before its maturity. 11. Eligibility for Statutory Liquidity Ratio (SLR) The investment in the Bonds shall be eligible for SLR.

8 12. Loan against Bonds The Bonds may be used as collateral for loans. The Loan to Value ratio will be as applicable to ordinary gold loan mandated by the RBI from time to time. The lien on the Bonds shall be marked in the depository by the authorized banks. 13. Tax Treatment Interest on the Bonds shall be taxable as per the provisions of the Income-tax Act, Capital gains tax treatment will be the same as that for physical gold. 14. 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 of gold and the full name and address of the applicant. The receiving office shall issue an acknowledgment receipt in Form B to the applicant. 15. 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 the 1st December, 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 the 1st December, Tradability in Bonds The Bonds shall be eligible for trading from such date as may be notified by the Reserve Bank of India. 18. Commission for distribution Commission for distribution shall be paid at the rate of rupee one per hundred of the total subscription received by the receiving offices on the applications received and receiving offices shall share at least 50% of the commission so received with the agents or sub-agents for the business procured through them. 19. All other terms and conditions specified in the notification of Government of India in the Ministry of Finance (Department of Economic Affairs) vide number F. No.4(13) W&M/2008, dated the 8th October, 2008 shall apply to the Bonds.

9 Yours faithfully, (Chandan Kumar) Deputy General Manager Encls.: As above.