We Design Your Financial Destiny


(Precious) Words of Wisdom : "Wall Street makes its money on ACTIVITY, you make your money on INACTIVITY." ~ Warren Buffett

Deposit your Gold to strengthen the Indian Economy

On Tuesday, Sept 15, 2015, the Finance Ministry announced the guidelines for the Gold Monetization Scheme.

It aims to reduce India's dependence on imported gold to meet the insatiable domestic demand every year, by utilizing the thousands of tonnes of gold lying idle in our homes and temples.

It is, in essence, a modification and revamping of the two existing schemes viz. Gold Deposit Scheme and Gold Metal Loan Scheme... the idea being to shift the focus from mere mobilization of gold, to effective use of these holdings.

Salient features of the Revamped Gold Deposit Scheme are summarized below.

Process for depositing your gold
a) Amoumt of gold
Minimum 30 grams. And, in any form whether bullion or jewellery.

b) Preliminary Test
You may approach the 'Collection and Purity Testing Centre' as suggested by your bank. First, an XRF machine test and weighing of your article would be conducted. This would tell you the approximate purity of your gold article. If acceptable, you can give your consent for melting. If not, you can take back your gold. (A nominal fee would be charged to you for this test.)  

c) Fire Assay Test
Gold, consented for melting, would first be cleaned of its dirt, studs, meena, etc. While the studs, etc. would be returned to you immediately, the article would again be weighed after this cleaning process. Thereafter, gold would be melted in fire assay and its true purity determined. (By the way, this process may take 4-5 hours.)

d) Deposit of gold
After the fire assay test, you still have the option to take back your gold (again, on payment of the prescribed fees) if you are not Ok with the results. However, if you agree to deposit the gold, the Centre will issue you the certificate for the weight and purity of gold deposited.

Note: There are presently more than 300 Assaying and Hallmarking Centres, certifying the purity of gold manufactured by the jewellers. Out of these, only the Centres that meet the BIS criteria would be approved to act as Collection and Purity Testing Centres under this scheme. Banks would be intimated about such approved Centres. It is expected that over time the number of such Centres would increase, making it convenient for us to deposit our gold articles.

monetize-gold-deposit-scheme
Many donated gold for our freedom. We can, at least, deposit gold for our economy.

Gold Savings Account
You can open a Gold Savings Account by complying with the applicable KYC norms. The said account would be denominated in grams of gold. It can be opened even prior to depositing any gold.

Bank will credit your account with equivalent grams of standard gold of 995 fineness, once you produce the certificate of deposit issued by the Collection and Purity Testing Centre. The Centre too would separately confirm to the bank, about the gold deposited by you.

Tenure
Short-term : 1 to 3 years (with roll over option in multiples of one year)
Medium-term : 5 to 7 years
Long-term : 12-15 years

Like fixed deposits, premature withdrawal (including part redemption) from Gold Savings Account is permitted, subject to paying the specified penalty.

Interest rate
For Short-term deposits : To be decided by the banks and would be denominated in grams of gold.
For Medium and Long-term deposits : To be decided by the Govt. and would be calculated in rupees, based on the value of gold deposited.

Redemption
Short-term deposits : Either as gold or in equivalent amount of cash, as decided by you at the time of depositing the gold (fraction quantity, where standard gold coin or bar is not available, would be redeemed in cash).

Medium and Long-term deposits : Only in equivalent amount of rupees.

Transfer of gold to refiners 
Banks can either hold these gold deposit themselves or transfer it to the refiners for safekeeping at their warehouse. Any fee payable to the refiners, would be borne by the banks. In this connection, there will be a tripartite agreement between the Bank, Refiner and the Collection and Purity Testing Centre.

Utilization of gold
Short-term deposits : Banks can (a) lend it to jewellers under the Gold Metal Loan Scheme, or (b) give it to MMTC for minting the Indian Gold Coins.

Medium and Long-term deposits : In addition to the above options for short-term deposits, these can (a) be auctioned by RBI or MMTC or (b) credited to RBI's reserves.

Taxation
Gold Deposit Scheme is exempt from Income Tax, Wealth Tax and Capital Gains Tax.

Besides, banks are also advised to inform the depositors that as per instructions No.1916 dated 11, May 1994 issued by the income tax authorities, the following guidelines on seizure of gold would apply
i.  For wealth tax assessees, only the gold in excess of that declared in wealth tax returns can be seized.
ii. For non-assessees, gold jewellery and ornaments up to 500 grams for per married lady, 250 grams per unmarried lady and 100 grams per male person of the family cannot be seized.  
iii. The Authorised Officer can exclude even larger quantity of gold from seizures, as he may deem fit, based on the circumstances of the case. This would be duly reported to the concerned Director / Commissioner.
iv. A detailed inventory, of all gold jewellery and ornaments found, should be prepared.

An Investment In Knowledge Pays The Best Interest ~ Benjamin Franklin

101 Classic Tips Money Gyaan

You Learn A Lot By READING... And Even More By SHARING.

Share Button

Ignorance is like a SIGNED BLANK CHEQUE... anyone can MISUSE it.

Subscribe via Email
Powered by Blogger.

... Three VALUABLE Tips ...

1. Why Mutual Funds Won't Survive On The Planet Mars
No Mutual Funds on Mars
Mutual Funds would be a totally ALIEN concept on planet Mars.

 


2. 10 Key Features of 'Standard Individual Health Insurance'
Standard Individual Health Insurance
Salient aspects of the Arogya Sanjeevani Policy.

 


3. Refinance Home Loan In Early Years (For Maximum Gains)
Loan Refinancing
Think before you make your move to refinance your loan.